The loss of a loved one is a challenging time, and it can be made even more so when disagreements arise between persons who are appointed as joint Executors as to how to handle the deceased’s final affairs.
Disputes between Executors can occur for many reasons which will generally result in increased costs and lengthy delays in the administration of the estate and stress to all parties involved.
Can you then have that Executor removed?
The Appointment of an Executor
As a pre-emptive measure, it is important for a Testator to discuss with their solicitor regarding the appointment of Executors. If you wish to appoint multiple Executors, you should consider the following factors:-
- Who are the beneficiaries of the Estate? – Is there likely to be a conflict of interest between the Executors and Beneficiaries? For example, is the proposed Executor a creditor/debtor of the estate?
- How complex is the estate? Does the proposed Executor have the required skills and knowledge to deal with the administration of the estate that is large and complex?
- What is the history of the relationship between the joint Executors? You should consider the existing dynamics between proposed Executors and avoid appointing family members who historically do not get along.
- Is there a likelihood of a Family Provision Claim? If someone makes a claim against the Estate, then it is the Executor who should defend against a claim and remain neutral. You should consider whether the proposed Executor can deal with a claim without being too emotionally invested.
Passing over an Executor
The Court has the power to ‘pass over’ an Executor who the Court considers is unsuitable or incapable to act in that role. That means that if an Executor has been passed over, they are unable to apply for and be granted Probate of the Will or if they have already been granted probate, they are removed as the Executor.
When can an Executor be passed over?
Generally, if a person has made a Will, then the courts recognise the principle of “freedom of testation’, which means that a Testator can leave their estate to whomever they want and in any way they see fit and appoint whomever they want as Executor(s) of their Estate. As such, the Court will not lightly interfere with a Testator’s discretion as to the appointment of their executor.
Whilst each case depends on its specific facts, the Court may nevertheless interfere with a Testator’s choice of Executor in only exceptional circumstances as the below:
- There is a conflict of interest;
- The Executor is of bad character and neglected his/her duty
- There is a clear likelihood of misconduct;
- The Executor refused to take out a grant;
- The Executor is absent abroad for a prolonged period;
- The Executor is of unsound mind, or otherwise is not competent to take out a grant.
Case Study 1 - ‘Substantial Dispute between the Executors’
In Re Coffey; O’Halloran v Coffey, no grant was taken out for 6 years since the death of the deceased as the Executors (being two of the deceased’s children) were in dispute over assets. In this case, the Court passed over both Executors on the basis that due to the substantial conflict between the Executors which caused the delays, even if one were to apply for Probate without the other, there could be no confidence that the Estate would be administered in a timely, efficient and impartial manner.
Case Study 2 – ‘Conflict of Interest’
In Mataska v Browne, the Executor was passed over due to her conflict of interest in having received a property from her mother during the mother’s lifetime. This transaction required careful examination as her sister had not been provided for in the mother’s Will. On this basis, the Court passed over the Executor and appointed the sister as a limited administrator in the Executor’s place to investigate the transfer of the property which took place between the mother and the Executor during the mother’s lifetime.
Case Study 3 – ‘The Executor is of bad character’
In Bowler v Bowler, the Court considered the exclusion of an Executor who had been convicted and imprisoned.
How to Make a Passover Application?
In Victoria, there are two ways in which a passing over application can be made as follows:-
- A probate Caveat can be lodged against a grant being taken out pursuant to Section 58 of the Administration and Probate Act A Caveator should articulate the reasons for the Executor to be passed over in their grounds of objections. You should be mindful that if the Court is not satisfied that you had a proper basis for lodging a Caveat, then you are at risk in relation to costs.
- An application can be made for a Grant of Representation in peculiar circumstances pursuant to Rule 5.02 of the Supreme Court (Administration and Probate) Rules 2014 (Vic). In your application, you should set out the reasons as to such an order should be made.
Conclusion When Executors Do Not Agree
There are a couple of avenues you can pursue to have the Executor removed. However, the Court will not lightly interfere with a Testator’s wish as to the appointment of their Executor, unless the Court is absolutely clear that doing so was in the best interests of the beneficiaries and for the due and proper administration of the estate.
It is also important to remember that there is no guarantee that your costs of making the application will be paid out of the estate, as the costs are always at the discretion of the Court.
If you would like your Will prepared, need to update a Will or have concerns about potential disputes between Executors, or if you’re an Executor involved in a dispute and you’re not sure how to resolve it, please contact our experienced Wills and Estates lawyers on +61 3 9822 8588.