Q. My dad recently passed away, my three sisters and I are executors of the will… Now what do we do?
A. Being named Executor of an estate carries with it a great deal of responsibility and should not be taken lightly. Executors are charged with the duty to make payment of all debts of the deceased and an obligation to the beneficiaries of the estate to conduct its affairs properly, openly and without undue delay.
The executors must keep track of all receipts and payouts as the beneficiaries are entitled to review all of this information. Although the Trustee Act, Ontario, identifies what assets can be purchased by the trustees on behalf of the estate, sometimes the Will itself allows the estate to invest in assets otherwise not allowed. In the event of an error in judgement where investments were made that either did not follow the directions in the Will or that were too risky resulting in loss of income to the estate, the executors are responsible personally to the Estate and its beneficiaries. The executors can purchase liability insurance which will protect them from any claims for errors in judgment.
As soon as is convenient the executor should take an inventory of the estate including all its debts and its assets. In the event there are assets that require probate to be transferred (such as money in a bank account or a guaranteed investment certificate) it would be necessary to probate the Will. This probes that the Will is the last will and testament of the deceased and will allow the financial institutions to make the transfer of assets to the estate in accordance with the executor’s instructions.
There is no rule regarding the number of executors that can be named in the Will. In a lot of cases only one party is named as executor. If there are multiple executors it is not uncommon to have disagreement among them as everyone is trying to do their best for the estate. Unless there is something specific in the Will, decisions made by the executors are usually by majority rule.
As well as taking an inventory of the estate the Will may also refer to guardianship for underage children. The guardians should be notified immediately so that they can make proper application to the court for the guardianship appointment. Even though it may state in the Will who the guardians should be, the court always has the final say regarding the appointment in case some intervening event has taken place which would I have the named guardians somehow disqualified and alternate guardians appointed.
Executors are entitled to fees for services rendered to the estate. The fees are based on a percentage of the total value of the estate and the difficulty in having the estate probated and settled.
In the event the beneficiaries do not agree with the fees claimed by the executors the issue can be brought before the court and settled by way of what is called a “passing of the accounts”. This illustrates again the importance of keeping proper record of receipts and payouts. This is as much a protection for the executors as it is information for the beneficiaries.
Of course any questions or difficulties can be directed to the solicitor for the estate for their input, direction and guidance.