By Louise Brown -
Snapshot
- An executor should understand the role of executor before accepting the office.
- An executor will usually be indemnified by the estate for the cost of professional legal services but rarely for non-professional work.
- A costs agreement which allows a lawyer to charge for non-professional work may expose the executor to liabilities for which he or she may not be entitled to indemnity from the estate.
- As a general rule, non-professional work should not be performed by a solicitor without the informed consent of all residuary beneficiaries.
- The Court regularly moderates solicitor’s bills that include charges for non-professional work.
Prior to 1981, all executors and administrators were required to verify and file accounts with the Court. Since 2009, the requirement to do so has been removed altogether unless commission is sought by the executor or a beneficiary files a notice of motion seeking orders for the executor to verify, file and pass accounts. As a result, the fees charged by solicitors in estate administration have, in recent years, effectively bypassed the examination of the Court. A practice appears to have developed where the scaled fee for obtaining probate is charged and a costs agreement is presented to engage the solicitor to perform not just legal work, but also the work of administering the estate.
Increasingly, beneficiaries are commencing contested proceedings to compel executors and administrators to file and pass their estate accounts. In many cases the legal bills are substantially moderated by the Court, particularly where charges for non-professional work are included. The result is that executors are often ordered to refund significant amounts to the estate for disallowed or moderated disbursements.
An executor must act personally
The office of executor is a gratuitous one and the appointee must act personally (see In the Will of Shannon [1977] 1 NSWLR 210 at 214G). In Chick & Anor v Grosfeld (No 3) [2012] NSWSC 1536, White J said at [7]:
‘As a general rule, an executor is expected to carry out his or her duties, including keeping accounts, personally. If he or she chooses to employ another person to carry out executorial tasks, the charges will be to his or her own account. However, where, having regard to the size and nature of the estate and the tasks that need to be carried out, it is reasonable for the executor to engage the services of another, the expense may be allowed as a disbursement.’
