Probate and Estate Administration
Even when a death is expected, the loss of a family member can be confronting and shocking, and it can be difficult to learn to live with the grief. In our view, the most important way to respond is to come together as family and friends to acknowledge the joy associated with the deceased person’s life and to acknowledge the impact their death will have on the people who knew and loved them.
But, necessarily, sometimes even before the funeral, legal issues arise about the deceased estate. For instance, did you know that the executor of the deceased person has a primary right at law to arrange for the funeral? The reason for this is fairly simple: the deceased person’s estate will be liable for the costs of the funeral, so it is right that the executor is primarily responsible for decisions that will have a costs consequence for the estate. But this is not an absolute rule, and there are exceptions.
Sometimes, urgent decisions must be made about property like pets, livestock or businesses. Again, the executor of the will has authority to “step into the shoes” of the deceased for the purpose of taking control of those assets which will ultimately form part of the deceased’s estate.
The authority given to executors is a reason why the choice of executor for a will is a vital one. When there is no will, other rules apply and can result in some unexpected and disastrous consequences.
Estate administration is concerned with what happens to the deceased’s property and interests after they die. Important factors include: whether or not there is a will, and if so, whether the will is valid, and what it means; what property or assets were personally owned by the deceased and therefore form part of the estate; what is required for the executor to get control over those assets; and what the executor must do to give effect to the deceased person’s testamentary wishes, as recorded in the will.
Often it will be necessary to obtain a grant of probate of the will from the Supreme Court. This involves advertising the executor’s intention to apply from probate and filing an application in the Supreme Court. The executor must also file an affidavit that addresses matters pertaining to the deceased’s death and other factors. The will and the death certificate must be filed with the application, along with any other relevant evidence that the court may require to ensure that the deceased person’s estate planning is given effect to.
In Queensland it is not always necessary to obtain a grant of probate of the will, and we have administered many valuable estates without a grant.
When there is no will, the court may grant letters of administration to a close family member, or other suitable person, and this grant will provide that person (the “administrator”) with similar legal authority to that of an executor.
The position of executor or administrator is very important, and by law they have numerous rights, duties and powers.
The primary duties are to “call in” the assets, discharge any liabilities, and to distribute to the beneficiaries, thus administering the estate as soon as may be.
The executor must therefore find out what the deceased’s assets actually are. Some property such as superannuation and life insurance may or may not form part of the estate.
There is no rule about the amount of time the executor might take to administer the estate as each estate is different and will require different action, but as a general rule, executors should not commence distributing a deceased person’s estate until after six months have passed.Executors can be personally liable to an estate if they do distribute the estate without first ensuring that there will be no challenges or claims.
Beneficiaries of an estate are the people who are to receive a benefit from the deceased person’s estate. Their primary right is to the due administration of the estate.
This is so even where they are gifted a particular item in the will such as a car or item of jewellery. Beneficiaries cannot require the delivery of the item until the executor has completed the estate administration. So, if your dad made a gift of his car or other item to you in the will, you do not have a right to take possession of the car until the executor has ascertained that the car will not be required for other purposes. It is only when the estate administration is close to completion that the car must be transferred the car to you. If the executor takes too long, you can apply to the court for orders that the executor transfer the gift to you.
The executor also has power to commence, continue or defend litigation on the deceased’s behalf. This is another reason why the executor must preserve the assets of the estate until the executor is satisfied that no problems will arise. Where the deceased did have debt that must be discharged, executors should be aware that some of the assets of an estate are “protected assets”, and that creditors cannot require the application of those assets in the discharge of the debt.
If the deceased died without enough money to pay all their debts, you do not have to pay those debts just because you are a spouse or child of the deceased person.
Estate administration is important, and it important that it be done right. For this reason executors are entitled to indemnity from the estate for the cost of legal advice and representation from the deceased’s estate.
We have extensive experience with complex estate administration and we assist our clients with practical and cost-effective representation. There are lots of trips and traps for people who have never had to deal with the fallout following the death of someone they love. We are delighted to help by answering the questions that arise.