Are you based in Brisbane or wider Queensland, and wondering what an executor is? Perhaps you are uncertain about the duties of an executor or how to choose the right person to act as executor for your estate. If so, you've come to the right place!
If you have or you know someone who has had to help with administering a loved one's estate after they pass away, then you know this can be challenging and sometimes daunting task.
This is why having a reliable executor is crucial, particularly if your estate is complex or there are difficult family dynamics to navigate.
In this blog post, we'll answer some frequently asked questions (FAQs) about Executors, whether that be in Brisbane or broader Queensland, to help put your mind at ease and ensure that everything goes smoothly when it comes time for your executors to obtain probate.
Table of Contents
What is an Executor?
When you die, your executor follows the instructions you set down in your will. While an Executor can be a beneficiary under the will as well, it is their overriding responsibility to ensure everything is administered properly and your assets are dispersed how you intend.
It is a primary obligation of the Executor to always act in the best interests of the estate, serving the estate and beneficiaries fairly and reasonably.
Accordingly, it is important to ensure you choose someone who you are confident will be trustworthy, fair, and conscientious.
Executors' duties depend on estate complexity – the more complex the estate is, the more involved the role of Executor becomes. They may need to find and value assets, pay debts, pursue monies owed to the estate, submit tax returns, distribute property to beneficiaries, or liquidate assets.
This can be a major job that requires attention to detail, organisation and an investment of time. So, it is important to appoint someone you trust, that has enough time to dedicate to the administration of your will and estate and that is readily (and preferably physically available) to discharge the required obligations.
Appointing a suitable Executor while making a will ensures that everything can happen as planned following your death.
What are the Duties of an Executor?
As mentioned previously, Executors carry out the deceased's will. You can have multiple executors appointed under a Will however each executor must perform the obligations and must act jointly unless specified to the contrary in your will.
No matter how many executors are appointed, it is important that they take legal advice in relation to the need for them to obtain probate so that they can administer the estate with requisite legal authority.
Below are some of the obligations that rest with the executors to fulfil.
Once probate has been obtained, the primary task of the Executors will be to gather and find all of the estate assets, and then deal with them in accordance with your will.
This includes the obligation to ensure that the executors take control of each asset, not leaving them in the charge of some other third party.
This includes all assets of the estate, such as bank accounts, investments, vehicles, and real estate. To discharge this obligation, the executors are likely to have to investigate your personal belongings and track down the relevant assets so they can take the appropriate steps to administer them as you have set down in your will.
As an Executor, you should value and manage all assets until the will full intentions have been given effect. You are entitled to seek reasonable assistance from qualified professionals that may be able to help you understand tax obligations and other liabilities, sell assets, invest, or generally administer the estate.
Executors should file tax returns for the deceased and their estate. It is important that you obtain advice from a qualified tax specialist to ensure the Executors complete their obligations in this regard.
Before distributing the estate, it is important that you ensure all debts of the Estate are paid in full and that any statutory waiting periods have lapsed.
After paying off debts, filing taxes, and ensuring no claims have arisen against the Estate that have gone unanswered, distribute what's left of the estate to beneficiaries listed in their will.
Executors must be dedicated, meticulous, and patient throughout a lengthy procedure. It is unfortunately a reality that administration of an estate can often takes over a year to complete.
How do I Choose an Executor for my Estate?
Choosing the right people to act as your executor/s is important as they will have sole control of your estate after you have passed, managing and distributing your assets according to your preferences. Some executor selection tips:
Start with someone trustworthy and capable of understanding and handling your financial circumstances. If your estate involves family trusts or other investment structures, it may be necessary to appoint a professional who has experience in dealing with those structures.
Second, pick a good communicator. The executor must contact relatives, lawyers, accountants and other third parties that may hold assets or be required to give input to their proper administration.
Thirdly, consider their estate management experience. If they're inexperienced, make sure they understand the job to which you are appointing them and are willing to put in the effort required to properly administer your final wishes.
Fourth, make sure the executor is willing and able to carry on the time-consuming role, keeping in mind that doing so after the loss of a loved one can be extremely difficult and daunting. You can always appoint multiple executors, and this may assist in helping them undertake the various tasks and reduce conflicts of interest.
Choose an executor thoughtfully by considering integrity, communication skills, necessary expertise/experience, willingness/availability/time commitment, and other factors that you consider relevant having regard to the nature and complexity of your estate.
Those executors should be readily available to fulfil the obligations on little notice. They are likely required to be physically present to engage with the estate lawyers and so, it is important to consider whether they should be based locally in Brisbane or whether further abroad is suitable.
How do I Prepare to be an Executor?
Executor preparation is vital, especially if you were nominated by someone who respects your judgement. Before becoming an executor, you must understand your duties.
You should research what the current obligations are upon executors, under the laws of the state in which assets are located.
Work with the person wanting to appoint you to get a good understanding of what their estate planning outcomes are, and how their assets are managed prior to their passing.
Read and comprehend their will, and don’t be afraid to ask a lawyer about unfamiliar legal phrases and concepts.
Next, ensure that the person appointing you organises and provides access to necessary papers. Bank statements, insurance policies, investment accounts, and other financial paperwork. Keep these documents safe and easily accessible.
Consult accountants or lawyers for advice on managing complex assets like businesses, companies, trusts, superannuation entitlements or property.
Communicating with family members or beneficiaries is also important. Knowing how the family members get along with each other and about any family dynamics that may require special attention is extremely useful in understanding how your appointor wants their wishes fulfilled.
Remember that being an executor requires patience and attention to detail. Take your time and make sure everything is done correctly, according to law, and fairly for all parties.
Do not act hastily to distribute an estate without observing the required statutory time frames that should be seen through before distributing an estate. If you are unfamiliar with what these are, then seek legal advice to guide you.
What are the Challenges of Being an Executor?
Being an executor of someone's estate is not always an easy task and can come with many challenges. One of the main challenges is managing the emotions and expectations of family members, friends, and beneficiaries.
Some people can be very emotional after the loss of a loved one, while others can be very impatient to access their inheritance.
Often, everyone has a different idea about what should happen to the assets in the estate. It can be difficult to navigate these differences while trying to fulfill your legal responsibilities as an executor.
It is therefore important for an executor to take the time to administer the estate properly and not give in to the requests of beneficiaries without having a proper understanding of the risks involved.
Another challenge is dealing with financial matters such as paying off debts or taxes owed by the deceased. This process can be complicated and time-consuming, especially if there are disputes over how much money should be paid out or there are insufficient readily accessible monies to pay those debts, giving rise to a need to sell assets that were otherwise intended to be inherited.
Handling personal property can also pose a challenge for executors. Deciding who gets what items from a loved one's possessions can cause tension among family members, leaving the executor to feels as though they are caught between a ‘rock and a hard place’ in having to balance their obligations and relationship with the family members.
There are strict timelines involved in executing an estate properly within Brisbane and wider Queensland law which could lead inexperienced executors into making wrong decisions without professional advice.
What Expenses can Executors Claim?
You can claim reasonable expenses as an executor. Expenses like:
Legal and accounting fees
Probate fees (if needed)
Travel costs to visit the deceased person's house or banks.
Printing and postage
Advertising, auctioneer, and other estate sale costs
Insurance and property taxes for estate assets
It is important for you to keep receipts for all expenses and submit them to the estate beneficiaries for reimbursement.
You should not request compensation for unreasonable or non-estate-related charges as Estate beneficiaries can dispute unjustified expenses and a court generally does not look favourably upon claims for reimbursement of frivolous expenses.
To avoid confusion, discuss big or uncertain expenses with beneficiaries beforehand.
Executors are not guaranteed money. However, a Will commonly compensates the executors for their time and effort, particularly if the estate is complex in nature or likely to be overly time consuming. The will may set a flat charge, a percentage of the estate, or allow the executor to choose.
The executor may also be entitled to appropriate remuneration even if the will does not specify payment or the amount.
The courts will evaluate the estate's size and complexity, the time and effort needed to administer it, and the executor's experience and expertise when determining reasonableness.
If you have been appointed as an executor but have not been left with any specified compensation, then you should obtain legal advice to ensure that you understand your rights in context of the estate you are administering.
Can the Executor use a Deceased Bank Account?
To manage the deceased's finances and pay debts, you may need to access their bank account as executor. The bank may require a grant of probate or letters of administration to verify your executorship.
It is important to note that any authorities that may have been in place prior to death end when the person dies. You must ensure that the accounts are therefore protected from unauthorised access and should notify the bank of the deceased’s passing as soon as possible.
After providing the required papers, the bank will normally release the funds to you on the basis that they are placed into an account specifically established for estate monetary assets or the trust account of a lawyer acting on behalf of the estate. From there, you can pay all legitimate estate expenses as necessary.
Only ever use the estate funds for estate related purposes and seek legal guidance if you have questions about using a deceased person's bank account.
Can an Executor Decide Who Gets What?
Executors must follow the will and distribute estate assets to beneficiaries. Not doing so leaves the executor immediately subject to claim and personal liability.
You cannot choose who receives what unless the will specifically delegates that authority to the Executor.
You must act in the best interests of the estate and beneficiaries, and carefully handle estate assets. Be upfront and accountable in your decision-making and notify recipients.
Keep plenty of detailed records so that you can demonstrate your compliance should you ever be questioned on the matter or your decisions.
If the will does not provide specific instructions, or if there are any ambiguities in the language of the will, you should seek legal advice as you may be required to distribute the assets in accordance with the laws of intestacy in the state of Queensland rather than in accordance with the will.
Are Executors in Qld Allowed to Sell Property Without the Approval of all Beneficiaries?
You are in charge of managing the assets and carrying out the directions in the will, as the executor of an estate. This may entail selling property if doing so is required to carry out the terms of the will or to settle the estate's obligations and expenditures.
In general, you are not required to obtain the approval of all beneficiaries before selling estate property. However, you are required to act in the best interests of the estate and to ensure that the assets are managed and distributed in accordance with the terms of the will.
Some wills may set down priorities in which assets must be sold in order to procure necessary funding while others will not, which may leave you in the difficult position of deciding what assets to sell.
In the latter instance, it is a good idea to speak with the beneficiaries and attempt to reach an understanding on the sale if you are thinking about selling property that is a part of the estate. You may even need to ask the courts for a decision if the beneficiaries are unable to agree on the sale.
It is important to note that you should not sell estate property without proper legal authority to do so. If you do, you may be personally liable for any losses suffered by the estate as a result. It is therefore important for the Executors to obtain Probate to ensure that they have been granted the requisite authority by the court to administer the estate.
Conclusion
Being an executor in Brisbane, or Queensland generally, is a serious responsibility that requires careful consideration and planning.
It's important to understand what the role entails before agreeing to take it on, and to choose someone who is up for the task if you are appointing an executor yourself.
Remember that while there are challenges associated with being an executor, such as managing complex legal procedures and potential conflicts between beneficiaries, there is reward in giving effect to a loved one’s final wishes.
By carrying out your duties competently and compassionately, you can ensure that your loved ones' wishes are respected and their legacy lives on.
If you have any further questions about being or choosing an executor, don't hesitate to contact us for legal advice. With proper preparation and guidance, anyone can fulfill this important role with confidence.