Executor delegating financial responsibilities

[blossom12]

Is it correct/legal for an executor of a will to delegate financial responsibilities of the estate to one of the beneficiaries?

What I mean is the executor has delegated the task of dealing with the financial side of the estate, ie. paying outstanding bills and/or debts, and has transferred the contents of the two bank accounts to the beneficiary's account in order for him to do this.

I have no idea on the legal or correct procedure, maybe someone can enlighten me. Can it only be delegated to a qualified solicitor?

The beneficiary in question is a qualified accountant but does not reside in this country.

Many thanks for any advice.

[des8]

Re: Executor delegating financial responsibilities

Personal representatives (executors) have the authority to delegate.
However if these delegated powers are not exercised appropriately then the executor is held accountable and will be personally liable to the beneficiaries if any losses occur.

[Johnboy007]

Re: Executor delegating financial responsibilities

Is it correct/legal for an executor of a will to delegate financial responsibilities of the estate to one of the beneficiaries?

What I mean is the executor has delegated the task of dealing with the financial side of the estate, ie. paying outstanding bills and/or debts, and has transferred the contents of the two bank accounts to the beneficiary's account in order for him to do this.

I have no idea on the legal or correct procedure, maybe someone can enlighten me. Can it only be delegated to a qualified solicitor?

The beneficiary in question is a qualified accountant but does not reside in this country.

Many thanks for any advice.

Hi,
The executor of an estate has to carry out the wishes of the deceased according to the will.
He has to pay all the debts from the estate first.
Government gets first bite.
Then it's a strict pecking order on what creditor gets paid first.
If there is not enough in the pot, all other debts are written off.
These duties are the responsibility of the executor.
In taking on this role, he/she agrees to carry them out accordingly.
What your executor has done is unlawful and he could find himself up to his neck in s**t.
He cannot transfer any money until all debts have been paid, and all beneficiaries have obtained what is lawfully theirs, according to the will.
If this is all covered then there shouldn't be any money over.
His/her role as a personal representative never ceases.

Who Can Be an Executor?
Pretty much anyone, provided they are not under a disability, and this includes a beneficiary can be an executor.
A professional such as an accountant or solicitor can also act as an executor. However an executor is not entitled to be paid for his services as of right so there should have been a charging clause inserted in the will.
An executor can be appointed expressly in the will or “according to tenor”-this derives from the tenor of the will and the functions assigned to them in the will.
There is no limit on the number of executors that can be appointed but no grant of administration shall be granted to more than 3 persons unless the Probate Officer otherwise directs.
An executor does not have to act; he can accept, reserve or renounce the executorship.
The Courts have decided that only in very serious cases will it order the removal of an executor.
The Role of an Executor

An executor’s job is to extract a grant of probate to the estate of the deceased and to administer the deceased’s estate.
The powers and duties of the executor date from the date of death of the deceased with the whole estate devolving to the executor.
An executor does not have to act and may renounce but once he/she takes on the role, he/she cannot renounce at a later date.

The Duties of an Executor
The first duty of an executor is to dispose of the body of the deceased. In practice, this will probably have been done by the deceased’s family.
The executor then needs to ascertain the precise value of the assets of the estate and protect them. This will involve ensuring that insurance is in place, where appropriate.
The executor must also ascertain all the liabilities of the estate such as taxes, outstanding claims, and outstanding debts. He/she must also ascertain all of the beneficiaries of the estate and check into prior gifts/inheritances that they may have received.
Then, the executor must prepare and swear an Inland Revenue affidavit which will list all assets and liabilities of the estate.
The executor then must lodge all the relevant documents in the Probate Office and extract a Grant of Probate. Once the Grant issues, he will gather in all the assets and dispose of those not being given to beneficiaries.
The executor must also pay all of the debts and expenses of the estate and distribute the assets, making sure that all taxes are paid. These taxes will include taxes due by the deceased prior to his death, all taxes arising out of the administration of the estate itself, and any inheritance taxes and capital gains taxes arising from distribution of assets.
Lastly, the executor must prepare an administration account where he accounts for all monies received and disbursed during the administration period.
Note:

1. an executor cannot delegate his authority but may engage the services of other people to help him, eg experts such as a solicitor, accountant, taxation specialist, auctioneer to value property etc.
2. an executor is not entitled to be paid for carrying out his duty but he is entitled to recover expenses incurred by him in the carrying out of his duty
3. there is no obligation on the executor to give a copy of the will to anyone before it is admitted to probate, nor to inform a beneficiary of his interest
4. the duties of a personal representative are for life
5. there is no limit on the number of executors that can be appointed
6. an executor can be appointed in a will or by implication, ie according to tenor (eg no executor is appointed in the will but someone is given the function of discharging the debts of the deceased).

The Powers of an Executor
An executor is given wide ranging powers by statute (the Succession Act, 1965) and by the will itself.
The statutory powers include:

• the power to sell all or any part of the estate to pay debts and to distribute the estate among the persons entitled
• the power to act as a trustee for the purposes of the Settled Land Acts
• the power to appropriate any part of the estate towards satisfaction of any share in the estate (subject to the provisions of section 55 of the Succession Act, 1965)
• the power to appoint trustees for an infant beneficiary
• the power to lease property for the administration of the estate
• the power to mortgage
• the power to settle claims and disputes.

Powers typically granted in a will include

• the power to appropriate without serving any notices or consents
• the power to invest or purchase authorised securities
• the power to employ agents/managers.

If in your case the executor has transferred money, he should be made aware of the consequences of his actions if it all goes pear shaped.

[Johnboy007]

Re: Executor delegating financial responsibilities

As a follow on to my previous post,
The executor can engage the help of an accountant, as in this case. But he cannot transfer funds into the accountant's own bank account and ask him to distribute those funds according to the will.

As this accountant does not reside in this country, I'm beginning to smell a Rat????????
Des8 was correct when he stated that the executor is liable for any money that goes missing.
If you are a beneficiary of the will, you are entitled to see the accounts of the estate, which the executor must keep.

Seeing as both bank accounts have been emptied and the money is now out of the country.
Unless you have proof that the money is safe and that the executor isn't planning on joining it.
I would seriously consider going to the police and asking them to investigate.

[bluebottle]

Re: Executor delegating financial responsibilities

Has the deceased in this case left a correctly drafted, signed and witnessed will or died intestate?

[Johnboy007]

Re: Executor delegating financial responsibilities

I am not sure on this one BB.
I just have the OP's first post to go on.
I just thought that this was right up your street, so to speak..........:okay:

[stevemLS]

Re: Executor delegating financial responsibilities

It is not right that Executors may not be paid for their services.

People can and do appoint banks as executors who charge a % of the estate, solicitors are normally cheaper but will still charge their standard hourly rates.

The Succession Act 1965 is an Irish statute - are we talking about ROI?

[des8]

Re: Executor delegating financial responsibilities

Following on the above I repeat in England & Wales Executors have the power to delegate.
Post 3 does seem to have been lifted, in part at least , from this Irish site: http://businessandlegal.ie/the-role-...of-an-executor
Not all the duties and powers stated are relevant to UK

[Johnboy007]

Re: Executor delegating financial responsibilities

It is not right that Executors may not be paid for their services.

People can and do appoint banks as executors who charge a % of the estate, solicitors are normally cheaper but will still charge their standard hourly rates.

The Succession Act 1965 is an Irish statute - are we talking about ROI?

No we are talking UK.
Yes an executor can delegate work but what he cannot do, is pass on his obligation to carry out the wishes of the deceased according to the will.
This duty is for life.
He remain responsible in law.

[Johnboy007]

Re: Executor delegating financial responsibilities

Following on the above I repeat in England & Wales Executors have the power to delegate.
Post 3 does seem to have been lifted, in part at least , from this Irish site: http://businessandlegal.ie/the-role-...of-an-executor
Not all the duties and powers stated are relevant to UK

I never go on Irish sites to check on UK law my friend.
This is from the probate department...
The executor can choose to delegate almost all the work to us or a solicitor, or to do the entire job him or herself
The key wording here is, almost all of the work, not all of it.

[des8]

Re: Executor delegating financial responsibilities

So we agree an executor can delegate his functions, but not his responsibilities

Relevant legislation Trustee Act 2000

[Johnboy007]

Re: Executor delegating financial responsibilities

So we agree an executor can delegate his functions, but not his responsibilities

Relevant legislation Trustee Act 2000

Well I agree he can delegate most of his functions.........:tinysmile_twink_t2:

[blossom12]

Re: Executor delegating financial responsibilities

Thanks for all your replies, some very interesting , however the money is safe in that respect so unfortunately I won't be selling the film rights.

Des8 - thanks for the answer on delegation. However, does this still apply if the delegated person is one of the beneficiaries and has access to the money in the estate? I would think that a delegated person should not be personally connected in this way?

[bluebottle]

Re: Executor delegating financial responsibilities

Thanks for all your replies, some very interesting , however the money is safe in that respect so unfortunately I won't be selling the film rights.

Des8 - thanks for the answer on delegation. However, does this still apply if the delegated person is one of the beneficiaries and has access to the money in the estate? I would think that a delegated person should not be personally connected in this way?

Hi Blossom12,

Do you know if the executor in question is executing a will the deceased had drafted, signed and witnessed during their lifetime and had mental capacity when the will was drafted and signed? If this is the case, then it is fairly straightforward. The executor follows the instructions as per the will and keeps records, including receipts for anyone who receives money from the estate. If anyone or any business makes a claim for an alleged debt, they must prove the legitimacy of the debt and the executor has a duty to ensure they do. What is considered "best practice" is to put a public notice in a newspaper and ask for anyone having legitimate claim on the estate to submit their claim with proof by a given date. Any claims received after the given date are not accepted and any would-be creditor gets diddly-squat.

If a person dies intestate, that is, without leaving a will, surviving relatives normally inherit the estate by succession.

[Johnboy007]

Re: Executor delegating financial responsibilities

Hi Blossom12,

Do you know if the executor in question is executing a will the deceased had drafted, signed and witnessed during their lifetime and had mental capacity when the will was drafted and signed? If this is the case, then it is fairly straightforward. The executor follows the instructions as per the will and keeps records, including receipts for anyone who receives money from the estate. If anyone or any business makes a claim for an alleged debt, they must prove the legitimacy of the debt and the executor has a duty to ensure they do. What is considered "best practice" is to put a public notice in a newspaper and ask for anyone having legitimate claim on the estate to submit their claim with proof by a given date. Any claims received after the given date are not accepted and any would-be creditor gets diddly-squat.

If a person dies intestate, that is, without leaving a will, surviving relatives normally inherit the estate by succession.

In answer to your question about 'if the delegated person is one of the beneficiaries and has access to the money in the estate?'
The executor can delegate most of his duties, what he cannot do is delegate his responsibilities.
So by rights, the delegated person should not have access to any money belonging to the estate, other than that which has been given to him lawfully by the executor.

Executor responsibilities in detail
These are the same as responsibilities of administrators (where there is no will) and responsibilities of personal representatives (which includes both executors and administrators). Here we will just call them executors:

• Obtain proper valuations of the assets of the deceased as at the time of death.
  Take all proper steps to protect the assets of the deceased and to manage any business of the deceased.
• Prepare and submit tax returns for inheritance tax and other taxes ensuring that all appropriate allowances, reliefs and write downs are applied for.
• Obtain any relevant tax clearances before distribution of the estate.
  Pay and settle all debts owing by the deceased, including all taxes.
• Complete and file all relevant documents for the court application for the grant of probate.
• Ensure that the wishes of the person who died have been carried out as set out in the will.
• Distribute the estate.
• Prepare estate accounts for beneficiaries.