Protecting Your Will: Dealing with an Incompetent Executor
When it comes to estate planning, an untrustworthy executor can undermine even the most meticulously crafted will. Selecting a reliable executor is crucial to ensure your assets are distributed correctly. This article provides guidelines to help you make an informed choice and avoid potential abuse or incompetence by the executor.
What Is an Executor?
The executor is the person appointed to handle the administrative details of your estate after you die. Their tasks can include:
- Probating your will
- Paying your debts and taxes
- Distributing your assets to your beneficiaries
The executor has a lot of power and responsibility, so it is important to choose someone you trust.
The Power of Executors: Have you considered what will happen to your assets once you pass away? Beyond the legal documents that specify the beneficiaries of your property, it is essential to contemplate the practical aspects of asset management. Who takes charge immediately after your demise? Who oversees investments and makes financial decisions until the assets are distributed? Who handles bills, tax returns, and the physical transfer of assets as per your will? The answer to all these questions is the executor. As the appointed individual responsible for administering your estate, the executor wields considerable power over your affairs. Unfortunately, without your presence to monitor their actions, there is potential for abuse or incompetence.
Instances of Bad Executors: Numerous cases demonstrate the negative consequences of appointing an unscrupulous executor. For example, a man, we'll call him Bob, left a $2 million estate in trust for his spouse, but the spouse never received any funds. Instead, Bob's lawyer, who was also the executor and sole beneficiary, profited from the trust. Another famous case involves Doris Duke, who entrusted her $1.2 billion estate to her alcoholic and semiliterate butler as executor. This decision resulted in exorbitant legal fees and delayed distribution to her chosen charities. Lastly, a New York lawyer attempted to steal from an estate by creating a fictitious heiress and assuming her identity while staying in a motel in disguise. These examples highlight the potential dangers of entrusting an estate to an executor who lacks integrity.
Source: The New York Times
How to Choose an Executor
There are a few things to keep in mind when choosing an executor:
- Trustworthiness: This is the most important quality to look for in an executor. Your executor can seek external guidance for implementing your will, but trustworthiness cannot be acquired or purchased. You need to be confident that they will follow your wishes and act in the best interests of your beneficiaries.
- Experience: If your estate is complex, you may want to choose an executor who has experience with estate administration.
- Availability: The executor will need to be available to handle the tasks involved in settling your estate. This may require a significant time commitment, so make sure you choose someone who is willing and able to take on the responsibility.
Should you use a Professional?
You may want to hire a professional executor if you don't have a trustworthy family member or friend who can serve as executor. A professional executor is an attorney or financial advisor specializing in estate administration. They will have the experience and knowledge to handle the tasks involved in settling your estate.
What to Do If Your Executor Is Not Doing Their Job
If you happen to be reading this article and are the beneficiary of a trust and your executor is not doing their job, you can take steps to remove them. You can also file a lawsuit against them for breach of fiduciary duty. Here are some tips for dealing with a bad executor:
- Talk to the executor. The first step is to try to resolve the issue directly with the executor. Explain your concerns and see if they are willing to make changes.
- Get help from an attorney. If you can't resolve the issue with the executor, you may need to get help from an attorney. An attorney can help you file a petition to remove the executor or file a lawsuit against them.
- Be patient. It may take some time to resolve the issue with a bad executor. Be patient and persistent until your wishes are carried out.
Choosing a reliable executor is a critical decision when creating an estate plan. By following these guidelines, you can increase your chances of finding someone who will fulfill YOUR wishes and THEIR duties with honesty and integrity.
All scenarios and names mentioned herein are solely for educational purposes. The information presented should not be used as the basis for any specific investment advice. This material is intended for general use. By providing this content Park Avenue Securities LLC and your financial representative are not undertaking to provide investment advice or make a recommendation for a specific individual or situation, or to otherwise act in a fiduciary capacity. Aaron Domingo is a Registered Representative and Financial Advisor of Park Avenue Securities LLC (PAS). Securities products and advisory services offered through PAS, member FINRA, SIPC. Financial Representative of The Guardian Life Insurance Company of America® (Guardian), New York, NY. PAS is a wholly owned subsidiary of Guardian. WestPac Wealth Partners LLC is not an affiliate or subsidiary of PAS or Guardian. Insurance products offered through WestPac Wealth Partners and Insurance Services, LLC, a DBA of WestPac Wealth Partners, LLC. CA Insurance License #0K45455 | Guardian, its subsidiaries, agents, and employees do not provide tax, legal, or accounting advice. Consult your tax, legal, or accounting professional regarding your individual situation. | 2023-156818 Exp. 06/25