Appointing an executor is an important decision when making your will. You should think carefully about the duties of an executor and the people in your life who you trust to fulfil your wishes before you name an executor in your will.
What does an executor do?
An executor is responsible for administering your estate, which means they implement the directions of your will or testamentary documents, settle any debts from available funds and finalise your affairs. They will, in most cases, be required to seek a grant of Probate through the Supreme Court of NSW, and then distribute your assets as instructed by you. Your legal advisor will tell you if it is not necessary to obtain a Grant of Probate.
For many estates, this is as simple as locating your will then taking steps to identify your bank accounts, if you own your home, and your superannuation and ensuring these are distributed. For other estates, business arrangements, complex investments and blended family arrangements can make this process more challenging. If there are legal disputes over your estate, your executor may need to participate in resolving these matters.
Executors usually seek the assistance of a solicitor through this process, with legal costs covered by the estate. Many executors will use the solicitor who assisted with your legal affairs, but they are under no obligation to do so.
If there are ongoing trusts in your will, or funds to be managed on behalf of a disabled or minor beneficiary until they are an adult, your executor will be responsible for overseeing these processes unless alternative arrangements are made.
If an executor is unwilling or unable to act on your behalf for any reason, then they are able to resign their position, known as ‘renouncing’ their role. This needs to be done formally as soon as possible after death.
Executors can apply to the Court for commission for their work.
What does an executor not do?
An executor is not personally responsible for your debts or liabilities if they are not covered by the estate.
Legal requirements
Any person over 18 who has legal capacity can act as an executor.
When making a will, you can nominate a single executor or multiple executors to act together. It is strongly recommended to name at least one substitute executor in your will in case your first preference is unwilling or unable to fulfil their duties for any reason.
Considerations
If your family circumstances and gifts in your will are simple, then naming a sole beneficiary and executor, such as your spouse or child, may be an easy choice for you.
If your estate is more complex, including trust, business and investment arrangements, or if you have more complicated family dynamics, your choice of executor may be more difficult.
It is important to choose an executor who you trust, and who you believe has the capacity to fulfil their legal responsibilities appropriately. When appointing multiple executors, you should consider their ability to work collaboratively. Appoint an executor whose interests are contrary to the interests of any beneficiaries should be avoided to minimise any personal conflict, but is not prohibited.
Being an executor can be a simple appointment, but it can also be a time consuming role. For this reason, you should consider whether the person you choose has the time and capacity to fulfil their duties. If their circumstances change between the making of your will and the will being administered, they can speak with a solicitor to renounce their appointment.
In appointing your executor and a substitute executor, you should give consideration to the likelihood that any person appointment is likely to survive your death.
The Court is unlikely to grant Probate to executors located overseas unless no other viable person is available.
Prior to nominating an executor, you should speak with them to ensure they are comfortable with the appointment. You do not have to disclose the contents of your will or any other details when doing so. Your executor should know the location of your will and where to find important information after your death.
Can a beneficiary be an executor?
It is very common for a beneficiary of a will to be an executor, including when the beneficiary is a spouse or child of the person making the will.
Conversely, it is not necessary for your executor to receive a gift in your will.
I don’t want to appoint a family member or friend as my executor, what can I do?
You can appoint your solicitor to be your executor, with provision made for relevant fees to be paid from your estate.
There are also trustee companies which can be appointed. Alternatively, arrangements can be made to appoint the NSW Trustee and Guardian. Both these options would attract substantial fees payable by the estate. Most lawyers discourage these options for because of the cost.
Ready to make a will? For advice on your Will and appointing an executor, get in touch with us today.
