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Executor’s Authority over Beneficiary

What you should know

Executor'S Authority Over Beneficiary

Can an executor of a will remove a beneficiary? If you are a person whose inheritance is being managed and distributed by an executor you might find yourself asking this question especially if the will grants the executor so much power that you are left wondering what’s the extent of their authority over beneficiaries and heirs.

When an estate owner prepares their estate, they usually appoint an executor to ensure their wishes regarding their assets and properties are carried out properly after death.  

Executors are not necessary in all cases, for example, in situations involving small, simple estate living trusts, joint ownership with survivorship rights, transfer on death deeds, or pay-on-death designations.

However, they are necessary in situations involving complex estates, contested wills, minor beneficiaries, and specific wishes about distributions, ensuring peace of mind that these wishes won’t be ignored after death.

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by | Nov 27, 2024 | Trusts

Role of an executor

Being asked to serve as an executor is a big deal since it means the estate owner trusts the person to carry out their wishes regarding the distribution of their assets and the management of their estate when they leave this world. However, it’s not a light task, people depend on the executor, to ensure their inheritance prospects don’t go off topic.

Executor’s Main Duties

Some of the main responsibilities expected from an executor of an estate are as follows:

  • Gathering important documents, including the will, death certificates, financial statements, property deeds, insurance property records, tax returns, debts/liabilities records, business documents, personal records, and any existing trust or estate plan documents.
  • Submitting the will in court
  • Notifying interested parties
  • Applying for probate
  • Establishing estate assets and liabilities
  • Paying liabilities
  • Managing estate assets – -investing, collecting benefits and income, and taking care of physical properties to prevent misuse, theft, and unnecessary depreciation
  • Distributing assets
  • Closing the estate

Authority Limits of Executors

Can an executor change a will? As mentioned, the role of an executor grants major powers and privileges but after all what’s required of the individual is that they carry out the deceased’s instructions as stated in the last will and testament, which of course includes passing inheritance to beneficiaries. An executor may not, therefore:

  • Take estate assets for personal gain
  • Ignore benefits
  • Withhold inheritance
  • Fail to disclose
  • Commingle personal properties/assets with the estate’s
  • Ignore estate debts and taxes leading to additional costs that take money from the estate and heirs

Most importantly, executors can’t just override wills. Wills can only be modified with the authorization of the court under certain circumstances, for example in case changes are necessary to address disputes or ambiguities in the document or if beneficiaries sign a deed of variation document agreeing to the addition of new beneficiaries, changes in the distribution of assets, etc.

Executor and Beneficiary Relationship

The main thing is that the executor-beneficiary relationship is fiduciary and one-way, which means the executor is the one expected to act in the best interest of beneficiaries and not vice-versa. California law code outlines specific rules that dictate how executors must behave as fiduciaries. These include:

  • Good faith
  • Disclosure
  • Prudence
  • Impartiality
  • Undivided loyalty, always placing the beneficiaries’ interest first, even above their own self-interest.

Beneficiary Rights

As already mentioned, the executor owes beneficiaries fiduciary responsibilities. In fact, the executor’s duties to beneficiaries is one of the most strict duty requirements in law. It’s a big deal and grants beneficiaries specific entitlements and protections.

Understanding Beneficiary Entitlements

So when an estate owner dies, their executor must file the will and death certificate in court and then notify interested parties about probate proceedings. Usually, the court allows the executor to do so within just 60 days of being appointed and they must provide beneficiaries with copies of the will and information about their rights. Some of these rights include:

  • Right to information. Executors must inform beneficiaries about what’s going on including the existence of the will, the date it was created, the name of the person who created the will, witnesses, the date of the probate hearing, a list of other beneficiaries, and or heirs of assets
  • Right to challenge the will
  • Right to an accounting of the executor’s activities from the time they took over the estate’s management
  • Right to information about the estate’s progress and the distribution of assets
  • Right to challenge executor’s actions that are not in the best interest of beneficiaries

Legal Protection for Beneficiaries

Once you receive the notification including a letter outlining your rights as a beneficiary, it’s important to read and understand them so you know what legal protections you have in case the executor goes rogue.

Conflicts with Executors

Conflicts may arise when carrying out one’s role as an executor of an estate. One of the responsibilities of an executor is to address issues brought up by beneficiaries promptly and professionally. You can always direct parties to mediation and arbitration with the help of a third party, such as an experienced will and trust attorney.

Executor’s Power Over Beneficiaries

While the executor has certain powers and privileges to help them distribute inheritance, they do not get to order beneficiaries how to live their lives or spend their inheritance. That being said, they may be given specific responsibilities such as managing the inheritance of beneficiaries who are minors or those with disabilities.

Conditions for Removing Beneficiaries

Can an executor of a will remove a beneficiary? Yes, an executor can remove a beneficiary if the will gives them the right to do so. For example, the creator of the will may have outlined that a beneficiary can only inherit under certain conditions which if not met the executor has no choice but to withhold benefits or redistribute them to others

Legal Restrictions on Executors

That being said, executors have their own legal restrictions to deal with. We are talking:

  • Fiduciary duty to prioritize the interest of beneficiaries
  • Avoiding conflicts of interest
  • Transparency and accountability including sharing accounting records with beneficiaries regularly without touching the numbers.

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Consequences of Misconduct

Falling short of these expectations can expose an executor to serious legal consequences.

For example, executors who breach fiduciary duties can face consequences such as:

  • Suspension or removal from their position
  • Personal liability including surcharges, and penalties to reimburse beneficiaries for any financial harm that they caused.
  • Criminal charges. In extreme cases, a rogue executor might even face criminal charges.

Legal Recourse for Beneficiaries

If as a beneficiary you suspect an executor of going rogue on you, you can take legal action. You can bring a lawsuit against the executor who has violated your rights.

Steps to Challenge Executor Actions

  • Document everything. Unexplained changes in assets, losses that follow a pattern, unexplained movement of funds, delayed benefits without sufficient explanation, failure to share records, etc. Do you see such telltale signs that the executor is violating your rights? Keep a record of all communications and transactions related to the estate.
  • Speak with an attorney to understand your rights and available legal avenues to seek justice and protect your interests.
  • Formalize your complaint with the probate court if necessary

Seeking Legal Assistance

Claims regarding inheritance are no joke, whether it be a breach of fiduciary claim or a dispute over a will. Talk about your case with an experienced attorney to understand the financial and legal implications before deciding whether it’s worth pursuing given the evidence you have. An attorney can in form you about your rights and help fight for your interests.

Resolving Disputes Amicably

If possible, give mediation and arbitration a chance to sidestep a long and expensive court battle. It just requires both sides to acknowledge each other’s concerns and arguments and be willing to make concessions if necessary.

Closing Thoughts

The role of an executor is a big responsibility and while these individuals are granted significant authority checks and balances exist to keep matters on the up and up.

It’s essential that beneficiaries remain aware of their rights and take steps to protect their interests. In case of conflicts, parties are welcome to seek legal help to resolve matters promptly and efficiently.

Frequently Asked Questions

Can an executor remove a beneficiary from a will?

Yes, an executor can withhold or redistribute a beneficiary’s inheritance if the beneficiary fails to meet the testator’s conditions for inheritance.

What powers does an executor have over beneficiaries?

An executor has the power to manage and distribute assets according to the wishes of the deceased. 

Can a beneficiary challenge the executor's decisions?

Yes, beneficiaries have a right to challenge executors’ actions that breach fiduciary requirements. 

Are there limitations on an executor's authority?

Yes, executors are subject to legal restrictions such as the fiduciary duty, maintaining transparency and accountability, and avoiding self dealing. 

What should a beneficiary do if they feel wronged?

If beneficiaries have reasons to dispute a will or claim a breach of fiduciary duty they should contact an estate litigation attorney as soon as possible. A knowledgeable probate dispute lawyer can review the situation and advise whether the claim is worth pursuing and the best strategy to address the dispute or breach.

How can beneficiaries protect their rights?

Beneficiaries can protect their rights by working with an experienced attorney to understand what they are entitled to and available legal avenues to seek justice if they feel wronged. 

Other topics of interest

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