An Executor is the primary person responsible for the administration of a deceased estate. Appointed by the deceased in their Will, the Executor is responsible for ensuring that the deceased’s wishes are carried out in accordance with the Will and that the estate is distributed properly. This role can be complex and demanding, involving legal, financial, and practical tasks. Understanding the full scope of an Executor’s responsibilities is essential for anyone considering taking on this role or for those identifying who they wish to appoint as the Executor of their Will.
What Does an Executor Do?
An Executor has a fiduciary duty to act in the best interests of the beneficiaries of the estate. This means they must carry out their responsibilities with honesty, integrity, and due diligence. Their primary goal is to ensure that the deceased’s estate is administered according to the Will, and if the Will is unclear or doesn’t cover all assets, the executor must follow the laws of intestacy.
Key Responsibilities of an Executor
1. Locating the Will and Applying for Probate
The first task of an Executor is to locate the deceased’s last Will and confirm the document’s validity. If the Will is valid, the Executor will then apply to the Supreme Court for Probate. Probate is a legal order that confirms the Executor’s authority to manage the estate.
2. Notifying Beneficiaries and Creditors
Once Probate has been granted, the Executor is responsible for notifying all beneficiaries of the Will. The Executor must also inform creditors of the estate, giving them an opportunity to make claims for debts owed by the deceased. The Executor must ensure that the debts are settled before distributing the estate.
3. Managing and Protecting Estate Assets
Once Probate has been granted, the Executor must take control of the deceased’s assets, which may include property, bank accounts, investments, and personal possessions. It is the Executors duty to protect the estate assets until they can be properly distributed. In some cases, this may involve insuring property, paying bills, or managing investments to preserve the estate’s value.
4. Paying Debts and Taxes
Before distributing the estate’s assets among beneficiaries, the Executor must pay the deceased’s debts. This may include mortgages, credit card bills, loans, and outstanding medical expenses. The Executor is also responsible for filing the deceased’s final tax return and ensuring any taxes owed by the estate are paid.
5. Distributing the Estate
After all debts, taxes, and expenses are paid, the Executor can then distribute the remaining assets to the beneficiaries as per the terms of the Will. If any assets are sold, the proceeds must be divided according to the Will. If the Will is unclear or a dispute arises, the Executor may need to seek legal advice or Court intervention. In the ACT, an executor must wait 6 months from the date of the deceased’s death prior to distributing the estate to the beneficiaries; this is to protect the executor from personal liability should a claim be made on the estate.
6. Keeping Accurate Records
Throughout the process, the Executor must keep detailed records of all transactions, including payments, asset distributions, and correspondence with beneficiaries and creditors. This documentation is essential to demonstrate that the Executor has fulfilled their duties and complied with legal requirements.
Being an Executor comes with significant legal and ethical obligations. If the Executor fails in their duties, then they may be held personally liable for any losses or damages to the estate or beneficiaries. Executors should seek professional advice (including but not limited to legal, financial and taxation advice) where necessary to ensure they meet their obligations, and they must always act in the best interests of the beneficiaries.
If you have been appointed as an Executor, it is prudent for you to obtain legal advice early. Robinson + McGuinness can assist you in understanding the role of Executor, apply for Probate, and subsequently administer the estate. Contact Robinson + McGuinness to arrange an appointment on (02) 6225 7040, by email at info@rmfamilylaw.com.au or get started online with one of our experienced lawyers.