The administration of a deceased estate can be carried out by one of the following individuals or entities:
Executor: An executor is a person appointed by the deceased in their Will to administer their estate. The appointment of an executor is typically outlined in the Will itself.
Administrator: If the deceased did not leave a Will or did not appoint an executor, an administrator must be appointed to administer the estate. The administrator is usually a close family member, such as a spouse, adult child, or parent of the deceased. If no suitable family member is available or willing to act as an administrator, the Court may appoint a professional, such as a trustee company or a solicitor, to fulfil this role. The administrator is bound to act according to succession and intestacy laws.
Public Trustee: This usually occurs when no suitable executor or administrator is available, and there are no willing family members or other individuals to take on the responsibility.
When administering a deceased estate in New South Wales, the executor or administrator has several duties to fulfil. These duties include:
• Obtaining a grant of probate or letters of administration
• Identifying and securing the assets;
• Collecting and managing assets;
• Paying debts and expenses;
• Keeping accurate records;
• Distributing the estate after settling all debts, taxes, and expenses;
• Filing tax returns on behalf of the deceased and the estate; and
• Keeping beneficiaries informed on the process and where the distribution is up to.
When administering a deceased estate, certain expenses and debts need to be paid before the remaining assets can be distributed to the beneficiaries. The priority of payment typically follows this order:
• Funeral and testamentary expenses;
• Outstanding debts and taxes;
• Administrative expenses;
• Specific legacies and bequests; and
• Residue or remainder of the estate.
A trustee can be involved in a few different ways:
Trustee of a testamentary trust: If the deceased had a testamentary trust established in their Will, they may have appointed a trustee to manage and distribute the assets held in that trust. The trustee’s role is to carry out the wishes and instructions outlined in the trust document, ensuring that the assets are properly managed and distributed to the beneficiaries according to the terms of the trust.
Trustee for a minor or incapacitated beneficiary: In some cases, the deceased may have left assets to a minor or incapacitated beneficiary. In such situations, a trustee may be appointed to hold and manage those assets until the beneficiary reaches a certain age or recovers from incapacity. The trustee acts in the best interests of the beneficiary and ensures that the assets are properly managed and used for the beneficiary’s benefit.
Trustee company: In certain instances, a trustee company may be appointed to administer the deceased estate. A trustee company is a professional organisation that specialises in acting as a trustee for various types of trusts, including deceased estates. They have the expertise and resources to efficiently manage the estate administration process, ensuring compliance with legal requirements and the proper distribution of assets.
If you are an executor or administrator that requires assistance in managing and distributing the estate of a deceased, please contact us to arrange for an initial conference to discuss how we can assist you.