Deceased Estate Administration
Estate administration is the process of finalising a person’s affairs after death. This is usually done by the executor of the deceased’s Will. If a person dies without a Will, then the law provides for who can administer the deceased’s estate.
An executor must always act in the best interests of the beneficiaries of the estate. If an executor acts in his or her own interests in preference to the interests of a beneficiary, they risk being removed by the Supreme Court.
If more than one executor is appointed, the executors must act jointly.
Companies cannot be appointed as executors unless authorised by law (e.g the Public Trustee of Queensland). Executors must also be over the age of 18 years and cannot be bankrupt.
If an executor has been appointed and they do not wish to undertake the role, they may choose to renounce. Upon renunciation, the back-up executor will step into the role. If a back-up executor has not been nominated in the Will, an Application for Letters of Administration must be filed in the Supreme Court.
The duties and responsibilities of the executor to administer a deceased estate include:
- arranging the funeral;
- arranging the burial or cremation of the deceased;
- securing the deceased’s assets (e.g. their home);
- identifying the deceased’s assets and liabilities (debts);
- notifying clubs and organisations of the deceased’s death;
- finding a Will. Depending on the assets in the estate, this may also involve applying to the Supreme Court for a Grant of Probate or Letters of Administration;
- collecting the assets (including ensuring the best price possible is obtained for any assets being liquidated);
- attending to payment of the liabilities (debts);
- distributing the proceeds of the estate to the beneficiaries as promptly as reasonably possible; and
- upholding the terms of the will subject to the resolution of any family provision claims against the estate.
If you have been appointed the executor of an estate, or would like to apply as administrator, we recommend you contact our Gold Coast estate lawyers today if you have any queries.
Executor’s Commission is a payment to an executor for the services they have rendered whilst administering an estate. It is optional for an executor to claim Executor’s Commission.
As the role of executor is gratuitous, it will require the consent of all residuary beneficiaries to the estate before payment can be made. If the beneficiaries do not consent to the payment, an order from the court will need to be sought.
There is no fixed fee or statutory scale for the payment of Executor’s Commission. It can be paid as an agreed lump sum amount or based on a percentage of the assets of the estate. Generally, the amount paid is related to the size of the estate and the amount of work required to be undertaken.
Sometimes, the Will might contain a clause which includes a lump sum payment to the executor as payment towards Executor’s Commission. This does not prevent an executor from making a claim, but the amount bequeathed will be taken into consideration.
Of particular importance when considering a claim for Executor’s Commission is that the payment of commission is considered income. As such, any payment received must be included in the executor’s personal income tax return.
Finally, failure by an executor to fulfil their duties and responsibilities toward an estate can impact their entitlement to Executor’s Commission. For example, intentionally causing delay, committing a dishonest act, fraud and neglect are all factors which would be taken into consideration.
If you are an executor and are considering claiming or defending a claim for Executor’s Commission, we recommend you contact our Robina legal team today to arrange an appointment.
When a person passes away, the executor of the estate must act in the best interests of the beneficiary. This includes administering the estate as promptly as possible and ensuring the beneficiary receives their full entitlement.
Some rights available to beneficiaries include:
- Right to Intermediate Income – if you have been specifically bequeathed an asset which produces an income (eg a rental property), you are entitled to the income earned from date of death until the administration is complete. Be aware, however, that entitlement to income can be offset by any expenses associated with the bequest;
- Right to Interest – if you have been bequeathed a general legacy (ie a gift of money) and have not received the bequest within 12 months from the date of death, interest can be claimed on the unpaid amount;
- Right to Remedy for Wrongful Distribution of Property – if the executor has mistakenly, or intentionally, transferred property to someone other than yourself contrary to the terms of the Will, you may be able to pursue a remedy for wrongful distribution;
- Right to Remedy for Ademption – if an asset has been sold by an Enduring Power of Attorney for the deceased during their lifetime, you may be able to apply to the court for compensation for the loss of benefit;
- Right to Remove Executor – in limited circumstances you may be able to apply to the court for the removal of the executor. Circumstances in which the court will grant such an application will depend on the actions of the executor and the impact such actions have had on the administration of the estate.
If you are a beneficiary and have concerns about the administration of the estate, we recommend you contact our Robina legal team to arrange an appointment.
On occasion, a person will pass away without knowing the location of a beneficiary of their Will. This is either due to estrangement or the deceased failing to leave details for contacting the beneficiary after they have passed.
As part of administering an estate, an executor must undertake all reasonable steps to locate a beneficiary. This includes contacting known acquaintances, reviewing electoral records and even engaging private investigators. Pursuant to the Trusts Act 1973, the costs, expenses and charges incurred by an executor to locate a beneficiary are payable out of that beneficiary’s interest in the estate.
If a beneficiary cannot be found, three options are available to an executor:
- The beneficiary’s entitlement can be paid to the Public Trustee;
- The beneficiary’s entitlement can be paid to a trustee company; or
- A Benjamin Order can be sought from the court to distribute the estate on the basis the beneficiary passed away before the deceased. Be aware, however, that if it is later discovered the beneficiary is alive, the beneficiary’s who took his/her share are obliged to relinquish what they received.
If you are an executor and cannot locate a beneficiary, we recommend you contact Dillon Legal.
Superannuation – De Facto and Interdependency Claims
When the payment of a superannuation death benefit is to be determined by the trustee, all eligible parties to the benefit are requested to apply for consideration. If you are a widow or child of the deceased, consideration and acceptance of an application is relatively straightforward. In contrast, if you are a de facto, or a person who was dependent upon the deceased, the application process can be complex. In both instances, eligibility is not assumed. It must be proven.
De Facto Claim
To determine whether two people were living together on a genuine domestic basis (and are therefore considered a de facto couple), factors such as the length of the relationship, the extent of common residence, the existence of a sexual relationship, the degree of mutual commitment toward each other and public aspects of the relationship are all taken into account. Temporary absences from each other and illness or infirmity of either or both of the parties are acceptable exceptions to the rule when considering whether a couple were living together.
Evidence in support of a claim as a de facto will be required. In some instances, corroborating Statutory Declarations sworn by relatives and friends may also be necessary.
Proving the existence of a de facto relationship can be difficult, particularly if surviving relatives dispute such a relationship. It is therefore recommended you seek legal advice before submitting an application.
Subject to the terms of the trust deed for the relevant superannuation fund, the key elements of an interdependency relationship are:
(i) there must be a close personal relationship between the deceased and beneficiary;
(ii) they must live together;
(iii) one or each of them must provide the other with financial support; and
(iv) one or each of them provides the other with domestic support and personal care.
Additional matters must also be taken into consideration. These are similar to that of a de facto relationship. For example, factors such as the duration of the relationship, the nature and extent of a common residence, whether a sexual relationship existed, and the degree of financial dependence are all taken into account. Temporary absences from each other and illness or infirmity of either or both of the parties are acceptable exceptions to the rule when considering an interdependency relationship.
Proving the existence of an interdependency relationship requires careful consideration of the legislation and case law to ensure all relevant factors are considered and included in an application. It is therefore recommended you seek legal advice before applying for this type of relationship.
If you wish to submit an application to a superannuation fund as a de facto or an interdependent of the deceased, we recommend you contact our Gold Coast lawyers today.