The Executor of a Will has a duty to administer a deceased person's Estate in line with the law and the terms of the Will. If they don't follow the Will and a Beneficiary feels that they have not received their full entitlement, they are entitled to challenge this. The Executor may be held personally liable for any breaches during Probate, even if these were genuine mistakes.
For free initial advice and guidance call our Probate Advisors on 03306069584 or contact us online and we will help you.
What Can an Executor Be Held Liable For?
The role of the Executor carries a significant amount of responsibility and can involve a lot of legal, tax and administrative work. The Executor has a duty to carry out this work diligently, acting in the best interests of the Estate and the Beneficiaries at all times.
If an Executor breaches this duty, then they can be held personally financially liable for their mistakes, and the financial claim that is made against them can be substantial. In an extreme example of this, one Personal Representative failed to settle the Inheritance Tax bill before distributing the Estate. HM Revenue & Customs claimed this back from him and the Court held the Personal Representative personally liable for the £340,000 tax bill.
For this reason, it's important that the Executor fully understands what is required of them throughout the Probate process, and it's essential that they carry out this work correctly. If an Executor has any doubts about what is required of them, or they aren't completely confident in carrying out this work themselves, they can instruct a Probate Specialist to help them.
In brief, the duties of the Executor can include:
- Valuing the Estate
- Calculating and paying Inheritance Tax (and other taxes)
- Applying for the Grant of Probate
- Locating and contacting the Beneficiaries
- Identifying and collecting all of the Estate assets
- Selling or transferring these assets
- Contacting creditors and settling any outstanding debts
- Preparing the Estate Accounts
- Distributing the Estate to the Beneficiaries
With our Probate Complete Service we take full responsibility for getting Grant of Probate and dealing with the Legal, Tax (excluding VAT), Property and Estate Administration affairs.
Deed of Variation
One way that the terms of the Will can be changed after death is if a Beneficiary chooses to redirect all or part of their entitlement to someone else. They can do this using a legal document called a Deed of Variation, which enables them to redirect their entitlement to whoever they wish.
This could be the case if, for example, the distribution of the Estate isn't equal or there's someone who has been omitted from the Will altogether, and they'd like to change that situation. The Deed of Variation needs to be signed by every Beneficiary who is giving up any part of their entitlement under the terms of the Will.
When Can a Beneficiary Challenge an Executor?
If a Beneficiary feels than an Executor has neglected their duties, that they have not followed the terms of the Will or that they have not acted in the best interests of the Estate, then they can challenge this.
Throughout Probate, the Executor should make a comprehensive record of all money coming into and out of the Estate, and this should be detailed in the Estate Accounts. Residuary Beneficiaries (those inheriting a percentage of what's left in the Estate after everything else has been paid) are entitled to see these accounts. This is because this activity will have a direct bearing on what they will ultimately inherit. If they feel that the calculations don't add up, or that the Executor has charged for expenses that are unreasonable, they can challenge the Executor.
In some instances, a Beneficiary may take legal proceedings against the Executor, to recover what they've lost. If the money cannot be recovered by other means, then the Executor could be held personally liable to cover this shortfall. The same is true for any creditors who are owed money from the Estate (unless they were given sufficient notice to come forward).
For this reason, it's important that the Executor doesn't distribute the Estate unless they are completely confident in their calculations, their expenditure and the decisions that they have made.
To speak with a Co-op Probate Advisor call 03306069584 or contact us online and we will call you.