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Definitions of Terms Used in Estate Administration
Executor
An Executor is the person nominated by a Deceased person in
their Will to administer their Estate upon their death. The
Executor must ensure that the wishes of the Deceased as
expressed in the Will are carried out.
Administrator
An Administrator is the person appointed by the Court under the
terms of the Succession Act to administer an Estate in
circumstances where either the Deceased did not make a Will or
having made a Will failed to nominate an Executor. Generally the
Court will appoint the closest surviving next of kin of the
Deceased as Administrator. An Administrator must ensure that,
where the Deceased left a Will, the wishes of the Deceased as
expressed in the Will are carried out or where no Will has been
made, that the Estate is administered in accordance with the
provisions of the Succession Act.
Personal Representative
Personal Representative is a generic term used to describe
either an Executor or an Administrator. For the purposes of this
information sheet, this is the term we will use.
Grant of Representation
A Grant of Representation is the authority issued by the Court
to a Personal Representative to act in the administration of an
Estate. A Grant of Representation is also known as a Grant of
Probate where the Deceased died leaving a Will or a Grant of
Letters of Administration where the Deceased died without a
Will.
Immediately Following the Death
If the identity of the Deceased's Personal Representative is
unknown at the time of death, the Deceased's next of kin may be
required, as a matter of necessity, to attend to some matters
which would otherwise be the responsibility of the Personal
Representative if the identity of that person was known. The
sorts of things that might need to be done include dealing with
the body, providing for the Deceased's dependants and securing
and maintaining the value of the Estate assets.
A person acting in this way must be careful however not to do
too much without specific authority from the Personal
Representative or the Court. Even a partial administration of an
Estate by a person without authority creates a personal
liability from the person to the Estate beneficiaries for any
loss the beneficiaries may suffer as a result of the actions of
that person.
Locating the original Will
The original Will (if one exists) must be located and reviewed
especially with a view to identifying any specific funeral
requests. Generally a Will is kept by the Deceased's lawyers, in
a safety deposit with the Deceased's bank or at the Deceased's
home.
If the Deceased did not make a Will
If the Deceased died without making a Will they are said to have
died intestate. In those circumstances, the Estate must be
administered in accordance with the Rules of Intestacy. These
rules are written into the Succession Act.
For the purposes of this information sheet, references to the
administration of an Estate in accordance with the terms of a
Will shall apply equally to circumstances where there is no Will
and the Estate is to be administered in accordance with the
Rules of Intestacy.
Funeral Arrangements
The next of kin may make the funeral arrangements where the
identity of the Personal Representative is not known or one was
not appointed. The costs of the funeral are payable as a first
charge on the Estate. If the Deceased has money with a bank, the
bank will usually pay the funeral account directly to the
Funeral Home upon production of appropriate Tax Invoice from
them. If an individual pays for the funeral from their own
money, they are entitled to an immediate reimbursement from the
Estate even though they may not subsequently be appointed as
Personal Representative.
The Personal Representative has clear authority to make all
decisions in respect of the funeral arrangements to the
exclusion of the next of kin. If there is no Personal
Representative the next of kin makes the decisions and if there
is any dispute between them, the Court makes them.
Deceased's Home
A Personal Representative must ensure safe custody of the
Deceased's home, contents and motor vehicles etc where the
Deceased lived alone. He or she may take reasonable steps to
enure their safety at the expense of the Estate.
Children
A Personal Representative must, where appropriate, arrange for
adequate and appropriate care of the Deceased's minor children
(and any pets).
Money for Dependents
A Personal Representative may arrange for the Deceased's
dependents to have access to adequate funds to enable them to
survive prior to the issue of a Grant of Representation.
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Initial Administration of the Deceased's Estate
If an Estate beneficiary nominated under a Will or appointed
pursuant to the Rules of Intestacy dies within 30 days of the
date of death of the Deceased, that beneficiary is deemed to
have died before the Deceased and, as such, will not take the
benefit left to them in the Will.
Therefore a Personal Representative should not make any
distribution of the Estate (other than matters relating to the
funeral or provision for the Deceased's dependants) until after
that 30 day period has passed and the entitlement of the
beneficiaries is certain. During the 30 day period, subject to
locating the Will confirming their appointment as Personal
Representative, the Personal Representative should attend to the
matters listed below.
Appoint lawyers to administer the Estate
The role of the Estate Personal Representative comes with
considerable obligations, liabilities and risks. Most Estates
warrant the expense of appointing an Estate lawyer to assist
with the administration. The most important consideration for
any Personal Representative is that he or she is personally
liable to both the Estate creditors and beneficiaries for the
proper and legal administration of the Estate.
Ascertain assets and liabilities of the Estate
The Personal Representative should commence ascertaining the
Estate's assets and liabilities. The Deceased's accountant and
the Estate lawyer can usually be helpful if these details are
not immediately known.
Advise of death
People and institutions relevant to the Deceased should be
advised of the death. Some Personal Representatives choose to
place a notice in newspapers published in the areas where the
Deceased lived or had business or personal interests.
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Applying for a Grant of Representation
Grant of Probate
A Personal Representative has personal liability to both the
creditors and the beneficiaries of the Estate. A prudent
Personal Representative will want certainty that the Will they
are administering is the Deceased's last Will. If an Estate is
administered (either knowingly or otherwise) pursuant to a Will
which predates the Deceased's last Will and the Personal
Representative has failed to seek Probate of the Will he or she
intends administering, that Personal Representative will be
personally liable to the beneficiaries of the last Will for any
loss they may suffer because of the incorrect administration.
A Grant of Probate is a document issued by Court that declares
that the Will the Personal Representative intends to administer
is the Deceased's final Will. Once the Grant of Probate has
issued, the Personal Representative is protected against:-
Claims from beneficiaries under any subsequent Will; and
Claims from any creditors of the Deceased who fail to notify the
Personal Representative of their claim within the statutory
period.
Payment of Estate Debts
The Personal Representative must ensure that all of the Estate
debts are paid before any payments are made to any beneficiary.
Tax
The Personal Representative must obtain a tax clearance from the
Tax Office both in respect of the Deceased's own tax and that of
the Estate if the Estate has generated a taxable income during
administration.
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Rights of the Personal Representative
Rights to Indemnity
A Personal Representative has the right to recover from the
Estate any personal money spent during the administration of the
Estate.
Right of Renunciation
A person may refuse to be appointed as a Personal
Representative. No one can be compelled to take up that position
despite being named in the Will as Personal Representative or
being the closest next of kin of the Deceased under the Rules of
Intestacy.
Right to Payment of a Commission
A Personal Representative may claim against the Estate for
payment of a fee or a commission to compensate them for their
efforts in administering the Estate. This payment remains
payable even if Estate lawyers have been engaged to facilitate
the administration. Payment is usually an amount agreed by the
residuary beneficiaries but in the absence of agreement, the
amount will be assessed by the Court.
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Appointment of an Estate Lawyer
Why appoint an Estate Lawyer?
As you have seen, appointment as a Personal Representative
brings with it significant obligations, personal risks and
potential liabilities. An experienced Estate lawyer will protect
the Personal Representative from all risks and liabilities and
ensure that the Estate is properly administered. The Personal
Representative and the Estate will benefit from the Estate
lawyer's professional indemnity insurance in the event that a
mistake is made during the Estate administration.
What does the Estate Lawyer do?
An Estate lawyer can do as much or as little in the Estate
administration as the Personal Representative wants them to do.
The Estate lawyer can do the entire Estate administration only
referring to the Personal Representative for instructions when
necessary or alternatively the Personal Representative can
complete most of the work and only refer to the lawyer for
advice and assistance when required.
Who pays the Estate Lawyer?
An Estate lawyer's costs are the responsibility of the Personal
Representative however they are recoverable from the Estate as
an Estate debt.
Where to now?
Speak to the Estate Lawyers
Often the best way to get the answers you need is to speak to
the Estate Lawyers.
Click here to contact one
of our Estate Lawyers via our contact form or please call us on
1300 368 255.
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