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The role of an executor in a disputed estate is fundamental. Executors are responsible for administering a deceased’s estate, and when an estate becomes contentious, their responsibilities are ever heightened.
During the course of ordinary estate administration, the executors are responsible for identifying and collecting in the deceased’s assets, settling any debts and liabilities, and distributing the estate in accordance with the deceased’s Will or the rules of intestacy.
The executor is also responsible for managing the deceased’s assets and financial affairs in the interim, prior to final distribution. This often includes undertaking tasks such as insuring properties, and paying bills and taxes. Executors have a duty to protect and maximise the estate for the benefit of the beneficiaries.
A neutral executor
An executor must continue to act in the best interests of the estate and its beneficiaries, even if a dispute arises. Sometimes, depending on the nature of the dispute, the beneficiaries of the estate will not yet have not been ascertained.
This could be the result of an ambiguous clause in the Will for example, or, where a challenge has been raised as to the validity of the deceased’s last Will, which can often result in there being two sets of potential beneficiaries (depending on whether the last Will is deemed valid or not).
It could also be the case that a successful claim under the Inheritance (Provision for Family and Dependants) Act 1975 (the ‘Inheritance Act’) is brought, resulting in someone becoming a beneficiary to the estate who was not named in the deceased’s Will.
Where there is a Will validity claim or claim under the Inheritance Act, it is not for the executors to determine who the correct beneficiaries of the estate are. This is a matter which will either be agreed between all the potential beneficiaries of the estate or determined by the court.
The executor’s role in these kinds of disputes is to provide full and frank disclosure of the relevant documentation and information, provide neutral assistance to all parties to the dispute where required, and cooperate with the parties and any court proceedings. Executors will ultimately be bound by any settlement or court order and will be required to carry out its terms, therefore it is important executors understand their role in the process and what will be required of them post resolution of the dispute. It is usually appropriate for executors to seek legal advice of their own when faced with a claim or dispute.
An executor/beneficiary
It can be difficult for an executor to remain neutral if they are also a beneficiary or a potential beneficiary of the estate. Therefore, if a dispute arises, it is essential that a person in this position carefully distinguishes their roles and that, in their capacity as executor, they are acting only to protect and preserve the estate and remain neutral in the dispute.
In their capacity as a beneficiary, they are entitled to take a particular stance in the litigation. However, if an executor intends to bring a claim against the estate themselves, it is often appropriate for them to renounce their role as executor and so it is important to seek specialist legal advice in these circumstances.
Executor’s costs
Ordinarily, an executor’s legal costs are an estate expense, and will be deducted from the estate assets before they are distributed to the beneficiaries.
If, however, an executor does not remain neutral, and actively defends or supports a claim to the estate, they will not be entitled to recover such legal costs from the estate and will need to pay these costs personally.
Similarly, as soon as an executor becomes involved in litigation in their capacity as a beneficiary, they must bear their own legal costs.
If you are an executor of an estate which has turned contentious, our experienced Disputed Wills Trusts and Estates team can help you to navigate your role and responsibilities. Please contact Hannah McElroy or another member of the team for advice.
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