Estate Administration…
Responsibilities of Executors / Legal Personal Representatives
This article relates to the administration of an estate in Queensland.
Administering an Estate
If the deceased had a will when they passed, there will be executor(s) appointed under the Will. The executor(s) named under the Will usually administers the deceased estate. In circumstances where the Executor(s) named in the will is unable or unwilling to perform their role, or where the deceased died without a will, then a legal personal representative is appointed as administrator under a grant of letters of administration issued by the Supreme Court and this person(s) will administer the estate.
If you are appointed as an executor of a deceased’s estate under their Will or have been appointed a legal personal representative to administrator the deceased estate you have a responsibility to administer the estate legally, appropriately and in a timely fashion and if there is a will then, in accordance with the deceased’s Will.
Personal Liabilities
Executors and legal personal representatives can be held personally liable for incorrectly administrating the deceased estate or breaching their duties as an executor or legal personal presentative.
It may be prudent to not distribute the estate to beneficiaries before 6 months has passed since the date of death of the deceased. The reason being, if an eligible person makes a claim against the deceased estate and the executor / personal representative had already distributed the estate to the beneficiaries before 6 months from the date of death, there is no longer money of the estate to recover against.
The executor / legal personal presentative may be held personally liable for ensuring an equitable distribution if the Court finds that the eligible person was entitled to a provision from the estate and there are no longer monies available to make that provision.
However, if the executor / personal representative distributes the estate to beneficiaries after 6 months has passed from the date of death and has not received any notice from any eligible person(s) of their intention to make a family provision claim against the estate within those 6 months, the executor / legal personal representative may no longer be held personally liable to account to any eligible person(s) for distributing the estate to beneficiaries.
Executors / legal personal representatives can also be held personally liable for outstanding tax liabilities of the deceased if they distribute the estate to beneficiaries without first satisfying these liabilities from estate funds. However, this liability is capped at the value of the assets of the estate. The executor / legal personal representative may be able to recover the monies the executor becomes personally liable to the ATO for from the estate or beneficiaries that received a distribution from the estate. However, recovery of these monies may be problematic particularly if the beneficiaries no longer hold the funds from the estate.
The role
The primary responsibility of the executor is to act pursuant to the wishes and Will of the deceased. An executor / legal personal representative will need to identify and gather assets belonging to the deceased, pay existing debts and liabilities of the deceased and disseminate the residue of the estate to the named beneficiaries pursuant to the will and if there is no will, then pursuant to the Succession Act 1981 (Qld).
An executor / personal representative also has a fiduciary duty to the beneficiaries. This means they must act in the best interest of the beneficiaries.
Additional duties
Other tasks of an executor can include: –
- funeral and burial arrangements;
- obtaining Probate of the will or letters of administration (where there is no will); and
- maintaining of record of the administration of the estate.
Timeframe to administer an Estate
In Queensland, there is no time limit within which to distribute the estate. However, the administration of the estate should be undertaken in a timely manner. Generally, 12 months is an appropriate timeframe for the administration of an estate unless there is ongoing estate litigation. In this time, the executor / personal representative should have identified all assets belonging to the deceased, settled the accounts with creditors and distributed the residue estate to the beneficiaries.
Conflict of Interest
An executor of an estate can be a beneficiary as well. However, the executor must remain impartial to their own bias existing from being a beneficiary. The executor must continue to make decisions regarding the estate that would not impede the equitable distribution of the estate.
In certain circumstances, it may be possible to apply to the Court to remove an executor in substitution with another person.
If you are an executor appointed under a will or a legal personal representative appointed to administer the estate and are unsure about your role and duties, you should seek legal advice.
I am an executor… I need assistance
If you believe you may need assistance with the administering of an estate, contact Klein Legal today. Klein Legal are experts in estate administration.
This is general information only and does not constitute legal advice.
If you or someone you know wants more information or needs help or advice about this topic, please contact us on (07) 5458 6855 or email mklein@kleinlegal.com.au