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Saturday, November 2, 2013

Arrogant executor says he will distribute "when he feels like it"

Yet another estate has ended up in stress and disputes for family members. This one appears to be caused by an executor who refuses to comply with any of the rules he is bound to follow. His attitude is probably going to cause damage to the family relationships that can never be repaired. What follows is a letter that a reader wrote to me, followed by my response.

"My mother died in October 2012. My older brother was made estate trustee (there was no will). Within less than a week of her death, my older brother looted her house of everything valuable, threw out who knows what, took all her paperwork which he refuses to let anyone see, and tried to put the house up for sale. He was thwarted by a realtor who told him he needed to wait for a court order granting him estate trusteeship. Without access to her paperwork, I have no idea what else she had. Neither myself nor my younger brother have received a single scrap of paper about what happened to her household assets, her bank balances, or any other accounting. The house was sold in March 2013, but that's all the information I have. Attempts to get him to explain what's going on ended up with him accusing me of harassment! He has told me and my younger brother that he will provide no accounting to either of us and that he will disperse the estate when he feels like it. My question is, how long do I have to put up with this before I have grounds to compel him to pass accounts to the court?"

Executors and administrators are supposed to take valuables into custody, clean out the house, safeguard paperwork and sell the house. However, the courts do not move so quickly that your brother could have been appointed within a week of your mother's passing. Why was he alone in the house, going through paperwork and assets? Until he was appointed by the courts, you and your younger brother had the same rights as he did. You said that he was thwarted by a realtor, as if you and your brother had no power in the situation, but you were on equal footing with the older brother at that time. 

It seems to me that this situation got off to a bad start with nobody really understanding what to do. Your older brother is taking advantage of that.

Since the house has been sold, I assume that eventually the paperwork was put into place to appoint him as administrator. If you didn't receive a notice from him with a copy of the estate inventory, you may go to the court to get a copy of the application your brother filed to get appointed. That will at least give you a starting point to work from.

Your brother's attitude of refusing to account and disbursing "when he feels like it" is not acceptable. I wish I could say this kind of misplaced arrogance is rare, but there is some kind of virus that executors and administrators catch that causes them to suffer from a God complex and to consider themselves bulletproof.

If the house was sold in March and there are no other significant assets, he should either disburse the estate, or advise you that he is applying for a tax clearance certificate. In either case, he is required to account to you. A year is long enough to wait, given that residuary beneficiaries such as you and your younger brother have the right to police his activities as administrator.

You should make a formal request in writing to your brother for a full accounting. Include a deadline (say, 14 - 30 days) by which he should produce his accounting. If you have already tried this with no response, consider hiring a lawyer to make the request for you. Remind your brother that you are within your legal rights to receive his accounting and that if he continues to refuse, you will consider asking the courts to compel him to account. This could well result in his executor's compensation being reduced, and/or his having to pay legal costs for himself and for you. Be sure to ask the judge to order costs against the executor for making it necessary to resort to the court for assistance.

Your question was about how long you should wait. An executor or administrator should be ready to account to the residuary beneficiaries at any time during the estate administration. That has been settled law for quite some time. There is really no acceptable explanation for a refusal to account for an entire year.

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