Extra care required as claims against executors rises
Recent figures released by the High Court of England and Wales show that there has been a significant rise in the number of claims issued for breach of fiduciary duty against executors of wills in the last 12 months. Emma-Louise Bradley, an Assistant Solicitor within the Contentious Probate Team, discusses the possible reasons for the rise and what people drafting wills or testators should consider when drafting their wills and selecting who they want to act as executors.
An executor is named by a testator in their will either to act alone or with other executors. After the testator passes away, the starting point is that the only person(s) who can apply for the Grant of Probate and distribute the estate is the executor(s). They have to collect in the assets of the estate, pay the liabilities, complete the relevant tax information and then distribute the estate in accordance with the terms of the will. Administering an estate can be an onerous and time consuming process. Testators can underestimate how much work could be involved and the complexities that could be encountered when they select who they want to act as executor(s).
Emma comments that “The recent rise in the number of claims may arise due to the increasing numbers of lay people being appointed as executors as opposed to professionals such as solicitors. Difficulties can arise for all manner of reasons during an administration. Common difficulties can arise when an executor is also a beneficiary, where there is already a dispute between the beneficiaries and where the executor(s) have some discretion in their dealings with the estate. Such difficulties can be even more profound where the executor(s) are lay individuals as opposed to solicitors. Lay individuals who are not used to dealing with administrations may find themselves ill equipped to deal with difficulties and may try to resolve matters themselves or simply not know what to do thus exacerbating the problem. Sadly, there are also cases where executors simply abuse their position either by benefitting themselves or particular beneficiaries over others.”
“Unfortunately, problems through either executors not dealing with issues properly or abusing their position can lead to claims being issued against them. These claims are often brought by beneficiaries for breach of fiduciary duty.”
The figures demonstrate that there may be an increased willingness to issue such claims. Thus, testators now need to take extra care about who they appoint and ensure that those that they select have the right skill set and willingness to act. Testators should also consider the benefits of instructing a professional executor to administer their estate. Not only will they be objective and unemotional in dealing with the estate but they will also be fully familiar with their duties and what is required of them. Whilst there is a cost for a professional executor to act, their costs may pale into insignificance when set against the costs of litigation if things go wrong.
Further, it is always open to lay executors to obtain support from solicitors in the administration process. If difficulties do arise and there is a possibility of disputes between executors, beneficiaries or both, executors are strongly advised to seek legal advice from a solicitor specialising in Contentious Probate to guide them in the dispute.
Emma summarises “It is important that testators think carefully before they appoint an executor. They should consider the duties involved and who is best suited to carry them out effectively. They should be advised to consider the advantages of appointing a professional executor. Equally, executors should always consider whether they feel they need professional assistance either at the outset or as soon as difficulties arise that they feel unable to deal with.”
Lawyers in the Wilkes Partnership Private Client Department can assist executors in the administration process whilst our Contentious Probate Team advises executors on their duties when administering an estate and can act for them in all manner of disputes. If you wish to discuss any of these issues in further detail, please contact Emma-Louise Bradley, Mark Terrar or Mark Abrol on 0121 710 5925/5927/5832.