Role & Duties of Executors, Administrators & Trustees
Who is an executor?
An executor is a person (or persons) chosen and appointed by the deceased to handle their affairs once they have passed away. The executor is appointed in the will and is in many circumstances also a beneficiary. The executor must identify the assets and liabilities of the deceased, take control and/or collect the assets, pay any debts of the deceased, and distribute the balance to the beneficiaries pursuant to the will.
Do I have to act as an executor?
An executor is not obliged to act and can decide to renounce their right to act permanently or merely ‘stand aside’ and let the other named executors continue to act without them.
Similarly, if a named sole executor dies before the deceased or before completing administration of the estate, then a ‘substitute’ executor will often take over if named in the will.
However, if the sole executor appointed has died before the deceased and there is no ‘substitute’ nominated, an administrator will be appointed pursuant to the legislation.
In some circumstances an executor’s own executor may be able to apply to the Court to become the executor for the purposes of completing the administration of the estate.
Who is an administrator?
Where there is no will, the person to handle the affairs of the deceased is called an administrator.
The administrator is the person appointed by the Supreme Court to take control of the deceased person’s assets and deal with their estate in a similar way to the role of an executor.
The person entitled to apply to be appointed as administrator is laid out in the Supreme Court Probate Rules 2015 (SA). The person in priority to apply is usually the deceased’s next of kin.
In some cases, an administrator can also be appointed where there is a will. This is usually because the appointed executor has died or is unwilling or unable to act and there is no ‘substitute’ to take their place.
What are the duties of an executor?
An executor has complete personal and legal responsibility for all matters involving the estate. Although every estate is different, an executor’s duties include:
- making sure the appropriate funeral arrangements have been made;
- ensuring that the last will of the deceased is located;
- identifying the assets and liabilities of the deceased;
- protecting and insuring assets;
- securing valuables and property;
- informing all beneficiaries of their entitlements;
- acting in the best interests of the beneficiaries;
- applying for a grant of probate (if necessary);
- collecting the assets of the estate;
- selling and/or transferring the assets of the estate;
- preparing a final tax return on behalf of the deceased person (if necessary) and potentially an estate tax return;
- paying all debts of the estate;
- distributing the assets to the beneficiaries;
- issuing financial statements of account to the beneficiaries.
For a helpful list of organisations to contact in the event of the death of loved one or friend please click here.
To download information on the Duties of an Executor click here.
What are the duties of an Administrator?
Whilst most of an administrator’s duties emulate executor’s duties as outlined above, an administrator has an additional duty to report to the Public Trustee with a full statement of account (detailing the transactions of the estate) within 6 months of obtaining a grant of letters of administration.
What is a trustee?
When an executor completes the administration of an estate but there is an ongoing interest or trust, the executor’s role then usually transitions to that of a trustee who continues to administer that portion of the estate until it can be distributed in accordance with the terms of the will.
Examples of when a trustee’s role is required are:
- where beneficiaries of a will are infants and full payment of their inheritance is deferred until they reach 18 years (or older);
- when there is a life interest or right to occupy a property;
- where a protective or testamentary trust is set up; and
- where there is a charitable fund.
Sometimes a separate person is appointed to be the trustee of the ongoing trust and in those cases, the trustee will take over once the executor has completed their obligations.
Obligations of a Trustee
A trustee has various obligations which are set out in the will and the Trustee Act 1936 (SA).
One of the primary responsibilities of a trustee is to invest the trust monies. A trustee must act prudently when investing monies and regularly review the investments.
Due to this financial responsibility and the fact that a trustee is often required to manage assets over a long period of time, it is prudent for anyone fulfilling this role to seek financial advice.
Do I need a lawyer to assist?
Executors and administrators should seek initial advice to find out the extent of their obligations in the circumstances, the requirements for handling the assets of the estate and the legal formalities to be completed. Following that advice, they can undertake some or all the role themselves or seek the ongoing advice or assistance of their solicitor.
We have offices in the city, at Tea Tree Gully and Morphett Vale for the convenience of clients. In addition, for the elderly or infirm, visits can be made to clients at home or in hospital.
Call us on 08 8415 5000 or send an email to make an appointment.