When should you consider appointing an independent executor?28-May-2020 Estates By Jemima Bissett
Are you concerned that your assets will be drained by bickering family members during the administration of your estate? Are you currently trying to administer an estate but are being held back by an uncooperative coexecutor? If so, you may wish to consider appointing an independent executor to ensure the job gets done, before litigation costs eat away the assets of the estate.
Typically, when making a will, an executor will be a spouse, child, or other family member. The choice of a loved one may make sense, given that you can be confident in their integrity, and that they will often be a beneficiary under the will. However, difficulties can arise if executors are family members.
In a recent case in the Supreme Court, seven years had passed since the death of a mother of three sons with no movement in the case. As one of the sons died in the interim, the relationship between the other two sons deteriorated to the point where administration of the estate was impossible. The third son had acted as a mediator between the two sons, and their deceased mother had not anticipated his unexpected death.
One way to avoid a similar circumstance from occurring in your family, or if you need to resolve a current difficult situation, is through the appointment of an independent executor. An independent executor is someone who administers the estate with no partiality because they have no connection to the estate.
When Should I Consider Appointing An Independent Executor?
You should consider appointing an independent executor if:
- Your estate has a complicated asset structure, such as trustee companies
- Assets such as shares, debentures, derivatives and other securities comprise your estate, and their management requires specialist skills and knowledge
- You are the sole director and shareholder of a company which requires an independent director with requisite expertise to manage in your absence
- You are concerned that your children will be unable to collectively administer your estate. This could be because:
- You do not wish to appoint all your children as executors;
- You have children that are estranged from other family members;
- Your children are all minors; and
- You have adult children that have strained relationships with each other.
- You are concerned that your will may be challenged.
- You believe that there is the possibility of a conflict of interest between the beneficiaries, and the personal interests of the executors.
Who Should I Appoint as an Independent Executor?
If you require an executor will specialist skills, you should ensure any executor appointed has the sufficient skills required to carry out the duties of administration competently and efficiently. Usually, an independent executor will be a solicitor or an accountant. For example, if your estate consists of a large number of trusts, then an Estate Planning Solicitor would be an appropriate person to manage your estate.
When will the court appoint an Independent Executor?
The court has jurisdiction to remove the nominated executors and appoint an independent executor to administer the estate upon application if the appointment of such executors would put the administration of the estate in jeopardy. A few reasons the court has previously considered include bad character, attempts at delaying administration of the estate, and extended periods of time overseas. It should be noted, however, that the court will place weight on the choice of executor by the deceased – it is assumed that this means the deceased placed in them great trust and determined that they could adequately perform the necessary duties. So whilst it is possible to remove a nominated executor, it is not something the court will take lightly.
What could happen if I don’t appoint an Independent Executor in my Will?
If you do not appoint an independent executor in your will and a dispute occurs between co-executors during administration, then there is a risk that the administration of the estate could be delayed by months or even years, increasing costs and causing detriment to your intended beneficiaries.
If you are currently dealing with difficult coexecutors or you are looking to proactively appoint an independent executor for your estate, contact the team of specialist Estate Practitioners at at Streeterlaw on 02 8197 0105 to discuss how we can help you gain peace of mind.
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