Disputes between Executors – The Consequences can be Expensive!

The standard position is that two or more people (often all family members) are appointed as the Executors in the Will of the individual – for the purposes of this article we will call her “Joan”.

When the sad event occurs and Joan dies, the Executors rally round, sort out the funeral and then appoint solicitors to deal with the estate for them. The  Grant is obtained, Joan’s assets are collected in; her house is sold; any debts (including tax) are paid and what remains is then distributed;  whether it be gifts of money or of specific things like paintings,  jewellery etc in accordance with Joan’s instructions as set out in her Will. The beneficiaries are grateful and touched that Joan thought of them – and life goes on.

Unfortunately, that scenario is not always what happens.

In many cases if the Executors are family members, they will also be beneficiaries under Joan’s Will. When acting as Executors they must act promptly, impartially and in agreement. The first job will be to obtain the Will. If there are two Executors appointed and the Will is held by Joan’s solicitors, those solicitors are not permitted to release the original Will to one Executor unless the other agrees. They can provide a copy of the Will, but the Executors will need the original to obtain the Grant of Probate.

If assets have to be sold to produce funds to pay Joan’s debts, the Executors must agree which assets are to be sold. They cannot make unilateral decisions and act on them just because they think it is the sensible thing to do; or because some of the beneficiaries are pressurising them to do it.

If the Executors have appointed solicitors to act for them in dealing with the Estate and then they have a falling out and cannot agree on what instructions to give to the solicitors – e.g. whether Joan’s house should be sold; which Estate Agents should be appointed etc – the solicitors cannot take any steps to carry out instructions given by one Executor when the other does not agree. Unless the Executors can settle their differences and agree the next steps – nothing will happen and the whole process grinds to a halt.

If it proves completely impossible for agreement to be reached and both are insisting on still being Executors – then the only viable option is for one Executor to make an application to the Court.   This could be on the basis that they should be the only Executor and the other should be removed; or that a Professional (usually a solicitor) should be appointed to be Executor in place of both of them.

When the Executors get to this stage there is often a firm belief that they are being entirely reasonable and the other is not; and if only the Court would remove the unreasonable person, they could get on with the job of administering Joan’s Estate.  The Court’s position however is generally not to get bogged down by the competing arguments as to who is being reasonable – but to take a pragmatic decision and remove both in favour of appointing another solicitor as the Professional Executor.  This would be a solicitor who is not already being instructed by the Executors and who has to be an experienced probate lawyer. Their fees would be paid by Joan’s estate so that immediately increases the costs quite apart from the costs of going to Court in the first place.

Executors should not assume that those Court costs will all be paid from Joan’s Estate. The Court has the discretion to order that the Executors pay the costs of that argument personally. This is on the basis that whilst there is no obligation on Executors named in a Will to take up the role; if they do and a Grant of Probate is made in their favour, then they are expected to carry out those responsibilities properly.

If the appointed Executors are at loggerheads before the Grant has been obtained and that is why nothing is happening; then there is a process whereby someone else who has a legitimate interest in the Estate – such as a beneficiary – can apply to the Court or the Probate Registry for a Citation. You cannot make such an Application until 6 months has elapsed from the death. It is basically an instruction to the Executors to get on and obtain the Grant within a certain timescale or they will be removed.

If the Grant has been obtained but nothing is happening – a beneficiary will have to apply to the High Court for an Order under s50 Administration of Justice Act 1985 to remove the Executors and substitute them with people prepared to carry out the role. The substitutes have to be named and have to consent to take the role. It is not possible to just ask the Court to remove the existing Executors and to “find someone else please”.

Executors are not going to be personally liable just because a beneficiary thinks they should have got more on the sale of Joan’s house or sale of her shares etc.  If they act honestly and reasonably and deal with things in a timely manner, they will be fine.

Occasionally Executors might be faced with an unusual situation – such as a beneficiary named in Joan’s Will who has gone missing and there is no evidence that they have died; or a clause in the Will that can be read in two different ways with two different outcomes. Instead of just assuming that the missing beneficiary is dead or picking which construction of the clause should be followed- and risk getting it wrong – they can apply to the Court for directions as to how they should proceed.  The Court will make what is called a Benjamin Order setting out what the Executors should do. If they follow the Court’s directions, they will not be criticised later.

Sometimes the size of the Estate means making an application for a Benjamin Order is not cost effective. Thus if Joan left £1,000 to an old schoolfriend that she had lost touch with years ago and reasonable checks have not been able to find that person or confirm whether they have died; the Executors can distribute the Estate having first obtained a “missing beneficiary insurance policy”. That covers them if the beneficiary later reappears and the cost of the insurance would be a valid expense of Joan’s Estate.

This is very much an overview and detailed advice should be taken on a case by case basis because the individual facts will have an impact on what you can sensibly do.

If you need advice or assistance on a problem relating to the above then please contact us on drteam@herrington-carmichael.com

This reflects the law at the date of publication and is written as a general guide. It does not contain definitive legal advice, which should be sought as appropriate in relation to a particular matter.

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Stephen Baker
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This reflects the law and market position at the date of publication and is written as a general guide. It does not contain definitive legal advice, which should be sought in relation to a specific matter.

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