Not infrequently, beneficiaries can feel that they are being kept in the dark as an executor administers the Estate. Thus the question “what are my rights?”.
Where a deceased has left a Will and made provision for a person (a beneficiary), the beneficiary will of course be anxious to know that the Estate is being properly managed by the executor and that they will receive the entitlement due to them under the Will within a reasonable time.
Specifically, beneficiaries’ rights include:
• Copy of the Will. The right to see and take a copy of the Will. The Wills Act (VIC) specifies those persons who are entitled to see a copy of the Will and that includes any person named as a beneficiary.
• Proper Administration. The executor has a legal obligation when exercising their responsibilities to act in the best interest of the beneficiaries. This is known as a fiduciary obligation.
Thus, beneficiaries’ rights include that the executor will properly exercise their functions in dealing with the assets and the proper management of administration of the Estate.
• It is expected that the Executor in administering the Estate will do so promptly.
• Information and accounting. A beneficiary is entitled to receive information during the course of administration and to have a full and proper accounting during the administration of the Estate. This means information including the income, expenses and the ultimate distribution of the Estate. The beneficiary is also entitled to inspect the financial accounts of the Estate.
• Changes and distribution. From time to time issues may arise in the administration of an Estate which might necessitate a change in the provisions made. For example there might be a challenge. There may be insufficient funds for beneficiaries to receive their full entitlement. There may be “agreement” between the beneficiaries to distribute assets without necessarily reducing all assets to cash.
• In such circumstances, a beneficiary is entitled to be consulted and, if necessary, permitted to take their own advice with respect to any matters that impact upon their entitlements.
• In the case of an executor who is failing in their responsibilities, either by failing to make an application for a grant of probate in a reasonable time, or failing to keep the beneficiaries informed or in any other way said to be in breach of their fiduciary duty, then a beneficiary has a right to apply to the Court to compel an executor to take action or, where appropriate, to have an order made to remove an executor from their role.
Such orders are only invoked in the more serious examples of an executor’s breach, nonetheless the right of the beneficiary to take such steps exists.
• Ultimately, a beneficiary’s entitlement is to be paid its entitlement in accordance with the terms of the Will and generally within a period of 12 months of the date of death.
Any responsible executor ought to be well aware of their responsibilities and thus in their dealings with beneficiaries be open and transparent and in regular communication with beneficiaries.