(Not) “to the Nines”: Nine Signs that an Executor Isn’t Doing Their Job

Many have had to experience a loved one’s death and deal with the probate process. An executor is a person named in the Will whose job is to distribute the estate as the loved one intended. They have a duty, called a fiduciary duty, to act in the best interests of the deceased person’s estate. When a loved one dies, we hope that their Will and intentions are being carried out by the executor according to their wishes. It can be a difficult job, but most executors perform it well. There are those executors who do not do the job well, perhaps even engage in misconduct.

We’ve represented many heirs who have suspected that an executor is being negligent, fraudulent, or untrustworthy. Here are nine signs that an executor is not doing their job properly and that you need to act:

• Ignoring the Beneficiaries. Part of the job of an executor is communicating with beneficiaries. Beneficiaries are entitled to certain notices and information. If the executor has not provided you with required probate notices or failed to respond to your requests for information, that’s a red flag that the executor is not doing the job correctly.

• Neglecting Duties. You would be surprised how often this happens. A person, maybe a sibling or relative, gets appointed as executor and then just does nothing. They refuse to move forward despite requests from beneficiaries to administer the estate. Perhaps they did not hire an attorney and do not know what to do or how to do it. Maybe the executor is not good with details and moving things along. Whatever the reason, an executor who neglects their duties is a problem that needs to be addressed.

• Missing Important Deadlines. There are several important deadlines for estate administration. Deadlines to send required notices to beneficiaries, for filing disclaimers of interests in the estate, to make an advance payment of inheritance taxes at a discount, filing the inheritance tax return, paying inheritance tax at face value, filing an inventory and status reports. There are many other deadlines. Most beneficiaries are unaware of these deadlines. An experienced estate administration attorney can inform you of the deadlines so that you can assess whether the executor makes or misses them, often costing beneficiaries substantial money.

• Self-Dealing. Self-dealing occurs when an executor uses their position of trust to act in their own best interest instead of the interest of the estate or the person who signed the will. It’s tempting for executors to sell estate assets to themselves for below-market value. Other examples include using estate assets (such as a vacation property) without paying rent to the estate, using assets to the exclusion of other beneficiaries, using estate money to pay expenses on a property that is devised by the deceased person to the executor. There are many examples of self-dealing. The longer you let this go on, the more difficult it is to undo.

• Not Hiring an Estate Administration Attorney. Executors are not expected, and often do not, to possess the know-how and skill to settle and estate. Without legal help, executors are almost guaranteed to make mistakes or take longer to settle the estate. The usual excuse is to save money. The cost of an attorney is deductible for inheritance tax purposes (that is, it reduces the amount of tax assessed against the estate) and is shared by all beneficiaries. The impact of an attorney’s fee to anyone beneficiary is minimal. However, the benefits of quicker administration and avoiding costly mistakes due to lack of knowledge is huge.

• Not Collecting Estate Assets into Estate Account. The executor has a duty to “marshal”—or collect—all the decedent’s assets so the assets can be distributed to the appropriate heirs. One costly mistake that we see is when an executor holds securities through a market downturn. A downturn in the market can cost beneficiaries tens of thousands of dollars. Another common problem is leaving money in an account that has automatic withdraws set up. These withdrawals continue for services that the decedent no longer uses, such as Netflix or other subscription-based services. It is very difficult to recover those charges.

• Not Safeguarding the Estate Against Identity Theft. Each year identity thieves use the identities of nearly 2.5 million deceased Americans to fraudulently open credit card accounts, apply for loans and get cellphone or other services. It’s called “ghosting” and because it can take six months for financial institutions, credit-reporting bureaus, and the Social Security Administration to receive, share or register death records, the crooks have ample time to rack up charges, costing the estate and its beneficiaries big money. There are steps an executor can take to prevent “ghosting”, but the unknowledgeable or negligent executor can leave an estate exposed to these inheritance-draining claims.

• Not Following Terms of the Will. Executors must follow the terms of the Will. That’s easier said than done for most executors because Wills often contain legalese or words of art that are difficult for a non-lawyer to decipher. One example includes provisions that pertain to paying inheritance taxes on assets passing in the estate. The decedent may provide for an allocation of inheritances taxes that the executor misunderstands or completely misses. This simple mistake can result in some beneficiaries paying too much tax on their inheritance. Sometimes we see executors who outright do not follow even the clearest provisions in the Will. Those situations require urgent action.

• Conflicts of Interest. An executor who is also a beneficiary can lead to conflicts of interest and is one of the main reasons that executors find themselves taken to court by beneficiaries. Some examples include 1) an executor who is also a creditor of the estate. Beneficiaries should wonder whether the executor can act fairly or impartially; 2) executor buying assets from the estate. The executor is supposed to get the highest reasonable price when selling assets but as a buyer, the executor would naturally be looking to pay the lowest price; and 3) an executor hiring his or her own company to provide services to the estate. As a vendor, the executor would want to charge high prices.

If you are an estate beneficiary who feels the executor is not handling their duties properly, you should not let this problem continue, as losses can keep adding up. You do have options to address the situation. It makes sense to get help from the probate attorneys at Fiffik Law Group. We will examine your individual situation and provide you with personalized service to find the options that work best for you. Contact us today for a free evaluation of your situation before it’s too late.