An executor is a person appointed under a Will to administer a deceased’s estate in the best interests of the beneficiaries.

However, in some situations, the person named as executor in a Will, may not be suitable to carry out their duties.

This may be because the executor has lost capacity or is in the process of losing capacity.

What are the duties of an executor?

Some duties of the executor include, but are not limited to:

• communicating clearly and promptly with beneficiaries;
• accounting for the estate’s assets and debts; and
• dealing with the estate without unreasonable delay.

If probate is required, the executor must make the application to the Supreme Court.

Loss of capacity can occur gradually or suddenly. An executor who has lost or is losing capacity may pose a number of risks to beneficiaries. These include:

• financial losses;
• poor administration; and
• tension between family members and the interested parties in the estate.

These risks can be avoided by the beneficiaries taking appropriate steps upon becoming aware that the executor has lost or is losing capacity.

The first step is to review and consider the terms of the Will itself.

Reserve (alternate) executor appointed under the Will

The Will may appoint a reserve executor to act in the case that the first-named or primary executor has died, refused or is incapable of acting due to a loss of capacity.

If there is more than one executor named in the Will, that person may make an application to the Court to be appointed as an executor in their place.

The reserve executor under the deceased’s Will, will need to supply evidence to the Court as to why the primary executor is unable to act, or why the role should be passed over to them.

What if there is no reserve executor is appointed under the Will?

If there is no reserve executor appointed under the Will, then a beneficiary named in the deceased’s Will, or some other person, may apply to the Supreme Court for a grant of Letters of Administration to be appointed to act and administer the deceased’s estate.

If the deceased’s did not leave a Will, the estate will be dealt with under the rules of intestacy.

Under these circumstances, an application will need to be made to the Court which is similar to applying for a grant of probate – although there is a legislative list of potential people (in descending priority) who may make an application to the Supreme Court for a grant of Letters of Administration on Intestacy.

Establishing an executor has lost capacity

As with passing over an executor, medical evidence will be required as to why the person is not suitable to act as executor, for example, by producing a doctor’s certificate.

If the Court is satisfied that the executor cannot perform their duties, it will appoint another person in the role who has made an application to be appointed.

If the Court considers that the executor is only temporarily incapacitated, it may grant a limited order that another person can act as executor while they are incapacitated. If it considers that the incapacity is permanent, it will make a general order allowing another person to take over permanently.

If a person has already commenced acting as executor and subsequently lost capacity or concerns arise about their capacity, an application can be made to the Supreme Court to remove them as executor. If granted by the Court, this will bring their duties as executor to an end.

The steps involved in dealing with the estate in these circumstances can be complicated and so legal advice should be obtained.

Can an attorney of an incapacitated executor act on their behalf?

Will-makers should also be mindful that when you appoint a person as your executor under your Will (and that executor loses capacity), the Supreme Court has the power to make a grant to the attorney of an incapacitated executor.

Accordingly, the executor’s appointed attorney for financial matters under their Enduring Power of Attorney, may be the one who ends up administering your estate (especially if there is no reserve executor appointed) – which may not be the person you intended. 

One way of reducing conflict is to regularly review your estate plan before you lose capacity.

Planning now and making the effort to review regularly, will safeguard your estate’s affairs after you pass away.

If you are experiencing an issue regarding the capacity of an executor, or making sure your estate planning affairs are in order to avoid these issues, please feel free to contact us.