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Tuesday, February 5, 2013

Can an executor get away with ignoring the instructions in the will?

Here is another letter from a reader who, as you readers tend to do, hit the nail right on the head with a question that will interest many of you.

"What can be some ramifications of an executor who disregards instructions that have been written in the will? I assume they cannot just get away with doing whatever they want can they?"

Executors get away with a heck of a lot, partly because they don't really know what they're doing and partly because the beneficiaries don't know either. This only gets worse when the executor either deoesn't hire an experienced estate lawyer, or hires one and ignores his advice. A large number of executors are under the impression that the estate they are looking after has been given to them to do with as they see fit, including re-writing the parts of the will they don't especially like, and of course this leads to trouble.

I'm glad to see you asking questions about this because beneficiaries and families in general need to know more about the estate process. There is no government agency that oversees what executors are doing. It's up to the beneficiaries of an estate to keep the executor on the straight and narrow, but that's not easy to do when you don't really know what the rules are.

Yes, there can be ramifications for an executor who disregards the specifics of the will. The severity of the consequences will depend on the facts of the breach. For example, an executor might ignore the will's instructions to sell everything, and give the beneficiary an item without selling it first. That would be considered less serious than an executor who decides to keep all of the money in the estate for himself without giving anything to the beneficiaries.

If an executor has simply made a mistake and realizes it, the objective should be to fix it to the extent possible without any need to punish anyone. However, court involvement is usually required to bring about any consequences for an executor because few will admit they've done something wrong, and even fewer will volunteer to correct their mistakes. The severity of the penalty is decided by a judge. Some of the things that judges will do fairly often are:
- remove the executor from the job of being executor
- reduce the executor's fee or withhold it altogether
- force the executor to produce a decent accounting
- set deadlines for the executor to meet
- force an executor to pay back money out of his own pocket

If the executor refuses to do as the judge says, the judge might ramp up the consequences. This could mean holding the executor in contempt of court, which could mean a fine or jail time.

If an executor has stolen from an estate, he can be arrested just like anyone else. Depending on the facts, this could lead to fines or jail time or other punishments decided by the courts.

Lately I've posted a few times about new cases involving executors who have been held accountable for not following a will. The courts seem to be cracking down on them, and for the sake of the families and beneficiaries who are at the mercy of the executors, I'm happy to see it.

4 comments:

  1. Hello Lynn! I just wanted to post a comment on this topic ! My two estranged siblings were caught with regard to doing an illegal realestate transaction on my late mother's home in June of 2012, as well as selling the home far below realestate value without my input or my lawyer's knowledge until my lawyer asked for a full account of what was sold and a copy of ledger of accounts in DEC./2012. Keep in mind a formal complaint to the lawsociety of B.C. with the exectrix's legal council involved was made in Aug.2012. Unfortunately, because my late mother's estate is small, I decided instead to have the law society investigate, rather than spend inheritance in court! It was in there opionion that an illegal transaction did take place, as well as tampering with final accounts giving the other heir a " credit" from my late mother's estate directly from executrix ,handling my mom's estate to purchase my late mother's home without my knowledge or my legal council's knowledge prior to final accounts being signed off by all three parties involved!.... The will stated a 1/3 for each sibling, did not state who could buy the house either! We settled on 3% for executrix fee, due to the sloppy egregious handling which by the way, the former paralegal was doing the accounts without a lawyer overseeing estate, and was fired from the law firm! So, senior lawyer did co-operate with the lawsociety! To date(Jan.22/14), it has been over 2yrs. Currently, CRA is at day 84, opposing lawyer stated that "accountant" took time getting final accounting in that it is 6months! Opposing lawyer sent email stating he suspected not much longer waiting for final tax clearance certificate! My question is, due to the sloppy egregious handling of the estate thus far through the opposing lawyer executrix,&other heir! Do I now have the right to push for tax clearance via threaten with court action? My lawyer stated a month ago, in an email, that we are in CRA hands at the moment! I discovered on the internet, that my late mother 's home is up for sale again and posted for alot more money before CRA has granted the tax clearance ! certificate! Any helpful advice?! Thanks!

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    Replies
    1. Wow, your family has really been through a terrible time with this estate. I'm not surprised to hear that the lawyer co-operated with the Law Society, since they control our licenses to practice law. If we didn't co-operate, that would only lead to further trouble.

      I'm also not surprised to hear of a paralegal working without proper supervision. I've run into that before too. Both the lawyer and the paralegal have to take the blame for that sloppy working arrangement.

      You say that the application for the final clearance certificate has been made, and that you are in CRA's hands now. Exactly who would you threaten with court action? If CRA has the application, there is nothing more that anyone outside of CRA can do. I don't see how threatening CRA with court action makes sense, since they are already doing what they are supposed to do.

      Hang in there. One day this will all be over!

      Lynne

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  2. Hello, I need your advice. My sister and my brother have been appointed as executors of my late mother's will. The lawyer for the will appears to ignore my brother as the other executor, and meets with my sister for the most part. Also, the lawyer appears to be dragging his feet with regards to this matter about the estate (from 2012 to present). The rest of the family is quite unhappy about this situation wherein my sister and the laywer have been dragging their feet about this matter.
    Can you give me some advice? Thanks in advice.

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  3. Lynn, my father's estate has two executors (joint) to handle his affairs. After my father's death, they consulted a lawyer to handle the funds of the estate. The one executor has all the documents and ignores any emails or messages from the 2nd executor. The only communication, is when he wants additional info that he thinks the 2nd one might have.
    I am a beneficiary and find this goes against my father's wishes.
    What can I do if anything, because the one ignores me also.

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