Real Time Web Analytics

Wednesday, October 1, 2014

The executor has done nothing for six years. What can a beneficiary do?

Here is a situation that will sound familiar to many of you - an executor who is doing nothing, while an estate sits, waiting. Is there anything a beneficiary can do? Yes! There are options, as I discuss below. Here is a question I recently received from a reader, followed by my response:

"My grandmother passed six years ago. My uncle was supposed to be the executor. He has done nothing or even maybe worse then nothing. He is no longer returning calls or communicating with family. How do I get my grandmothers estate taken care of?"

It's time for you to take action. In fact, that time arrived about five years ago.

There is a common-law rule of thumb in Canada called the Executor's Year, which lets both executors and beneficiaries know that an average estate with no lawsuits should be wrapped up in about a year. Realistically, it is more like 18 months but at the end of a year, an executor should have substantially completed the estate.

If your uncle is named as the executor and is doing nothing, a beneficiary of the estate may apply to the court for help. The help you ask for will depend on exactly what the executor has done (or not done), exactly which assets remain in the estate, whether there has been any loss to the estate, and what you are prepared to do. Some of the things you can ask the judge for include removing the uncle as executor, or imposing deadlines on the uncle such as selling a property by a certain date.

If there has been financial loss to the estate, and it sounds from your question like that may be the case, you may ask for further help. For example, if the executor has failed to invest estate funds for six years leading to a loss of interest earnings, you may ask that he repay these losses personally.

When I say that you may apply to the court for help, please understand that before a court case is launched, many lawyers will suggest that a letter be sent to the executor outlining exactly what the problem is, and giving him a deadline to get his act together before you sue. This is to try to avoid an expensive, lengthy lawsuit if the situation can be salvaged. The majority of cases don't actually need a trial to sort them out, but it could go that far if the executor has damaged the estate or is uncooperative.

With a bit of luck and plenty of discussion, it's possible that you can light a fire under your uncle without having to endure a trial. That would be the optimum solution, as lawsuits are horribly expensive and you have no guarantee that your costs will be covered.

Mediation is another option, if it is available in your area. It might be useful for the executor and the beneficiaries to meet in the presence of a neutral third party to talk about why the estate is not progressing, and what can be done to kick-start it. This is certainly cheaper than litigating, but it relies on the willingness of all parties to participate.

By refusing to answer calls or communications, your uncle is refusing to deal with the estate. He apparently thinks that ignoring the situation will make it go away. However, the legal system won't care if he refuses to answer. His answer is not necessarily required for matters to go ahead.

I've met many, many beneficiaries over the years who hesitate to enforce a will because they feel that doing so will make them look greedy, or because it will upset family dynamics. However, please keep in  mind that when your grandmother named you as a beneficiary, she conferred certain rights on you. She also conferred the responsibility of ensuring that the executor carries out his job properly. There's nobody else watching what an executor does; it's up to the beneficiaries to keep him on the right path.

4 comments:

  1. Thank you for this. I'm in a similar situation.

    ReplyDelete
    Replies
    1. I'm sorry to hear that, but not really surprised. It's amazing how common it is for estates to linger for years with little or no information going out to the beneficiaries.

      Lynne

      Delete
  2. My dad is executor of my grandmother's estate. It has been delayed for almost 5 years but the main issue is that he has been using her house (part of the state) as a "summer home" and allowing friends and certain members of the family to stay in it. He is preparing the disbursement and has included a housekeeping fee in the costs going against the estate. My problem is that I feel that the house could have been generating a sizable income (rentals are at a premium here) while he has been delaying the estate issue so he could save enough money to buy the rest of the beneficiaries out. Should/can we be compensated for him using the home for personal use?

    ReplyDelete
    Replies
    1. I agree with you. That house is not his to use personally. He should have been paying rent. and paying all consumable costs (power, water, etc). The amount that would have been earned in rent and saved in expenses should come directly from his pocket (i.e. not out of the estate but his personal funds).

      Lynne

      Delete

You might also like

Related Posts with Thumbnails