As the largest Will maker and executor in NSW we have compiled a list of the most commonly asked questions relating to executorship.
If, after reading these you have any further questions relating to Wills please contact your nearest branch of NSW Trustee & Guardian on 1300 364 103 or fill out our enquiry form.
1. I have been appointed executor what should I do?
Many people see it as a compliment to appoint a friend or relation as their executor. However, the majority of people when nominated as an executor are unsure of what is expected of them and this can lead to mistakes being made and the executor being held liable. In many instances the work involved is complex and time consuming requiring knowledge of law, accounting and taxation requirements. All estates are not alike and can differ for a number of reasons. An estate may be administered and distributed according to a Will or, if there is no Will, according to a legal formula which specifies who will receive the proceeds of the estate.
Steps that an executor needs to take:
- Locate Will
- Make funeral arrangements if required
- Preliminary conference with family and business associates
- Advise beneficiaries and ascertain immediate needs of the family
- Protect assests: protect business interests, collect valuables and income, insure all property, keep surplus funds invested
- Determine assets and debts, prepare statement thereof. Assets may include personal effects, securities, real estate, property outside NSW, cash, business interests. Liabilities may include debts due and debts owing.
- Apply to Supreme Court for a grant of Probate and attend to legal formalities - realise assets to pay liabilities including income tax to date of death and prepare accounting and tax information for beneficiaries
- Distribution of Estate
- Establishment of Trusts - pay legacies and hand over specific bequests, transfer funds or assets to beneficiaries, obtain receipts, prepare final statement for beneficiaries
- Continuing administration and asset management if required e.g. to manage longer term trusts
2. How long is administration of an estate likely to take?
The time taken to administer an estate varies widely and is dependent on the complexity of the estate, as well as additional factors such as how long it takes to realise (sell assets) such as real estate, if anyone contests the Will, and locating missing beneficiaries.
Being an executor even for a simple estate can take a considerable amount of time. Due to legislative changes in the Succession Act 2006, the minimum time to finalise an estate is 6 months from the date of death. If you as the executor distribute the estate before this time you are not protected if claims are made against the estate. However, most estates are finalised within 9-12 months. If there are difficulties locating beneficiaries, challenges to the Will or the estate involves setting up trusts for minors or life interests, the duties of the executor may take several years.
3. What is Probate?
As an executor you will need to apply for Probate. Probate is essentially official recognition that a Will is legally valid and gives permission to proceed with administering the estate. An application is made to the Probate Registry of the Supreme Court for a Grant of Probate. The grant is a document certifying that the Supreme Court recognises the authority of the executor(s) to deal with the estate. This will enable you to administer the Will (collect the assets and pay any debts of the deceased person and then to distribute the estate as directed).
A Grant of Probate is necessary to ensure that the person seeking the release of assets has the authority to do so. Therefore banks and other asset holders such as insurance companies, and superannuation funds generally require Probate before releasing or transferring assets. A Grant of Probate is also necessary if real estate is to be transferred or sold.
4. How do I go about obtaining Probate?
To obtain a grant of Probate the executor must file various legal documents at the Supreme Court. Documents required include: the original Will, the death certificate and a complete statement of all assets and liabilities of the estate.
For a comprehensive summary of the requirements and the forms go to: www.supremecourt.lawlink.nsw.gov.au
5. How do I renounce my executorship?
While people may see it as a compliment to appoint a friend or relative as executor they often fail to consider that what they are asking is a huge task for someone who may be grieving and distressed. Being an executor even for simple estates can take a considerable amount of time. The skills required can also be very difficult for an executor who does not have relevant experience in law, accounting, business management or finance. As executor you may be liable for your management of the estate.
Just because you have been nominated as the executor doesn’t mean you have to accept. Taking on the responsibility may not be the right thing for you and it is unlikely that the person who nominated you would have wanted to put you in a stressful situation.
If you have been named as the executor of a Will you are under no legal obligation to accept the appointment. Should you not wish to act as executor then you can ‘renounce probate’ and transfer the role of executor to an independent professional executor such as NSW Trustee & Guardian. Once probate has been granted you it is more difficult to renounce although it can be done by following a procedure set out in the Probate and Administration Act 1898 which allows for the appointment of NSW Trustee & Guardian or a trustee company to be replacement executor or administrator.
6. Who may contest the Will?
After a grant is made the Will becomes a document of public record and a copy is available from the Supreme Court to any person upon payment of the appropriate fee. While a person is entitled to leave their assets to anyone they wish there are a number of grounds on which the distribution of a person’s estate can be challenged:
Validity of the Will:
- On the grounds of the lack of testamentary capacity of the testator: Testator (person who wrote the Will) did not have the legal capacity to make the Will.
- The testator may have been subjected to undue influence by a third party
- The Will does not comply with formal legal requirements, for example it may not be signed by the testator in the presence of two more witnesses
What do the terms in the Will mean. The Will may be poorly worded or ambiguous. An application may be made seeking the assistance of the Court in the interpretation or construction of the Will.
Challenges under the family provision sections of the Succession Act 2006:
Family or people in a close relationship with the deceased persons or dependents who believe they have not been adequately provided for are entitled to contest the Will. Those who can contest the Will are not restricted to spouse and children. Claimants can include a de facto partner, any other dependants or a former spouse of the deceased. Complicated family structures such as blended families and second marriages may increase the likelihood of a Will being contested.
Challenges to a Will can be costly and delay the process of estate administration.
7. What is a Trustee and what are their responsibilities?
An executor’s duties do not necessarily cease when the final distributions have been made. This can occur where assets are held for children, where income from an estate is payable to its beneficiaries during their lifetime, there is a life interest in an estate or a long term trust is set up by the Will, they may have to continue in the role of trustee until the trust ends or funds are extinguished.
Because the Trustee is often required to manage assets over a long period there is a vital need for permanency and financial management skills. If you are holding funds as a Trustee you can retire and appoint a new Trustee. NSW Trustee & Guardian is able to offer both permanency and prudential financial management for ongoing trusts.
8. Why choose NSW Trustee & Guardian as Executor?
NSW Trustee & Guardian has been administering estates for nearly 100 years and are experts in estate management offering a full estate administration service. As professional executors we have a range of staff specialising in estate and trust management, legal, financial and accounting services and are therefore fully equipped to deal with any problems that may arise during the course of administering the estate.
Our expertise in estate management is especially valuable in:
- Providing impartiality in managing disputes between family members in relation to inheritances – ensuring that you will not be caught in the middle or exposed to any liability
- Managing any long term trusts created by the Will
- Administering overseas assets
- Handling income and trustee tax issues
- Handling conveyancing.
- We also have extensive interstate networks through other State Trustees
- Our in-house genealogy department is able to efficiently trace all beneficiaries, heirs and next of kin reducing the time necessary to administer the estate. It also reduces the risk and legal consequences of distributing the estate to incorrect heirs.
- All money received from an estate forms part of our common fund and earns interest.
- NSW Trustee & Guardian is a perpetual organisation so we will always be around to ensure that the instructions of the Will are properly carried out.
9. How is NSW Trustee & Guardian different from solicitors?
Having a full range of professional staff including estate and trust managers, solicitors, accountants and genealogists NSW Trustee & Guardian is equipped to deal with any problems that may arise and we are able to offer a ‘one stop shop’ for estate and trust management.
Our ability to fulfil all the tasks of executorship differs from solicitors who act on the advice of the executor who has employed them and may only carry out some of the tasks of executorship.
10. What does NSW Trustee & Guardian charge for administration of an estate?
Like all trustee companies and solicitors we charge a fee for administration of an estate. Fees for aministering an estate are detailed under Executor Fees and Charges.