The role of executor of a person’s Will is one of unique responsibility, and their appointment is one of the most important decisions a person can make when creating this essential legal document.
Once the testator (will-maker) has passed, there are a number of duties which the executor may be required to carry out. These duties will depend on the circumstances of estate but typically include appling for a Grant of Probate, preserving the assets of the estate and reducing them into possession, paying any of the estate’s outstanding liabilities, defending the estate against any legal proceedings, managing the deceased’s tax affairs and, ultimately, distributing the estate’s assets to the beneficiaries under the terms of the Will.
For all these reasons the Queensland Supreme Court has stated more than once that it will ‘not interfere lightly’ with a testator’s choice of executor. In the 2006 case of Baldwin v Greenland, for example, the court noted that the testator’s choice of executor may be based on loyalty, respect, necessity, their profession, or some other matters the testator new about. The overriding assumption is that the testator thought the person chosen was worthy of trust. As such, a court will only remove an executor and trustee where there is a firm conclusion it is necessary for the due and proper administration of the estate which would otherwise be put in jeopardy if a particular person were executor or trustee.
In what circumstances can an executor be removed?
Section 6 of Queensland’s Succession Act 1981 gives jurisdiction to the Court to revoke probate of a Will and to hear and determine all matters relating to the estate and the administration thereof. This means the court may in its discretion remove an executor of an estate whether Probate has already been granted or not.
The most common situations where it’s considered necessary to remove an executor is where there is misconduct in the administration of the estate. This may include the executor dealing with administration of the estate in either an incompetent or fraudulent fashion.
Incompetence will usually consist of a lengthy delay in administering the estate, potentially wasting the estate’s resources on expenses. Failure to communicate with beneficiaries or account for the assets of the estate are also grounds to argue the executor is unfit to act in the office.
Fraud would involve an executor utilising assets within an estate for their own benefit, or perhaps paying himself or herself commission without authorisation.
There is also a general principle the executor should have largely completed the administration of the estate within one year from the date of the deceased’s death. However, failure to finalise the administration of the estate and distribute it to the beneficiaries within this timeframe does not mean the conduct of the executor justifies removal. As some estates are more complex, or subject to disputes, there can be delays which would prohibit the executor from ultimately finalising the administration of the estate this quickly.
Where beneficiaries believe an executor is unduly delaying administration of the estate however, the first step is to send formal correspondence to the executor asking them to promptly attend to their duties or explain the cause for the delay.
If the dispute cannot be resolved then the beneficiaries (or other ‘interested parties’) may make an application to the Supreme Court asking orders to be made to either direct the executor to carry out his or her duties, or remove the executor and appoint an administrator.
How the court reaches a decision
In assessing whether an executor should be removed the court will consider what is necessary for the ‘due and proper administration’ of the estate.
As mentioned, the court will not lightly remove an executor. As past cases have demonstrated, the court will even take into account the willingness of an executor to correct or remedy an error when they are accused of inept or incompetent administration. In Budulica v Budulica, a 2017 Queensland Supreme Court case, a sister’s application to have her estranged brother removed as executor of their mother’s estate was dismissed after the brother provided reasons for delay and rectified some of the matters on which his sister had based the proceedings. Ultimately, the court found that the sister did not prove there was grounds, at that stage, to make it necessary or desirable for the court to remove the executor. Moreover, given that the administration of the estate was significantly advanced the advantages to the executor continuing in his role outweighed any disadvantages.
Another common cause of an application to remove an executor occurs where co-executors were appointed by the testator. If there is evidence that the co-executors cannot effectively administer the estate because of disagreement or a failure to co-operate, then the court may remove both as executors.
In Re McLennan QSC 124, two siblings appointed jointly as executors of their father’s estate were removed from their roles and an independent administrator was appointed, despite it being unnecessary to determine misconduct or unfitness.
As the case was, relations between the joint executors had become complicated and conflict-riddled because of Family Provision Applications made against the estate, as well as a transfer during the deceased’s lifetime to one of the executors. As a result, the judge made the decision to remove both as executors in the interests of the due and proper administration of the estate.
The importance of good advice
Whether you’re a testator, an executor, or a beneficiary dissatisfied with the administration of a deceased’s estate, at Big Law we can help you with sound, relevant advice.
While it’s assumed a testator makes a sober and considered decision in appointing an executor, once they pass other circumstances can intervene and can result in an executor/s failing to observe their fiduciary duty to the beneficiaries of the estate. If you believe an executor is delaying or improperly administering an estate, contact Big Law today for an initial consultation.