According to Forbes, the COVID-19 crisis has forced US citizens to consider estate planning more seriously. As the crisis’s volatility continues to impact our everyday lives, wealth transfer has become more common.
Before you get down to business and start writing your will, here are a few problems that you might face in New York:
A will contest is a legal effort made to invalidate a will. Anyone can contest a will if it’s believed to be procured by fraud or forgery. You can also challenge a will if you have reasonable grounds to believe that the testator lacked the mental capacity to write a will or was made to sign it under duress. A will can also be invalidated if it’s outdated, and a more recent version of it exists or if it isn’t compliant with the state laws.
However, you can’t contest a will just because you don’t like its provisions and terms. Other than that, you also must be directly affected by its outcome to challenge it. A legal heir or a beneficiary can only contest the will. After a will is successfully contested, the court invalidates the entire will, instead of a single provision.
In either case, it’s not easy to contest a will because the entire process also translates into court expenses. Only an experienced probate attorney can simplify the process for you.
There Is No Written Will
This shouldn’t surprise you. 68% of Americans currently don’t have a written will. Dying ‘intestate’ will only complicate the matters for their surviving descendants. According to the state laws, when someone dies without a will, the court decides how the estate will be distributed.
When a New York resident dies without a will and no children, the surviving spouse usually inherits the estate. If there are more legal heirs, the surviving spouse only gets $50,000, and the rest is divided among the descendants. If there is no spouse, the entire estate is inherited by the descendants.
This is a problem because you might not want your estate to pass on to your surviving spouse, especially if you’re not on good terms. A large number of Americans prefer leaving their estate to charities. Your wishes will only be honored if you have a written will.
The Executor Isn’t Carrying out Their Duties Well
An executor is the individual chosen to oversee the probate and honor the deceased’s wishes. Your chosen executor can step down from the role or choose not to have a say in how the estate is distributed. This usually happens when they take upon the duty without realizing the gravity of the responsibilities and pull out later. In this case, the court will check if you name a successor executor. If there isn’t one, the judge will appoint an estate administrator to carry out the probate duties.
With the right probe representations, none of these problems are too big. If you’re based in Brooklyn, Manhattan, or Queens, The Law Offices of Joseph A. Ledwidge, P.C. can help you out! Joseph Ledwidge Attorney has around 20 years of experience in helping clients deal with complicated probate cases. Reach out for a free consultation.
An estate executor or administrator is an
individual—or, in some cases, a corporation—who is granted permission by the
courts to oversee the unsettled legal affairs of a decedent. This position
comes with a variety of duties and responsibilities that depend on the scope
and status of the estate in question.
The duties of an executor may include distributing the
estate’s assets to beneficiaries, notifying interested parties of the
decedent’s passing, filing the decedent’s will in probate court, and paying
taxes and other expenses out of the estate’s account. The executor has a fiduciary
duty to carry out these responsibilities in a manner that complies with the law
and the desires of the decedent as laid out in the will.
Sometimes there is a valid reason to question the
suitability of a particular executor with regard to the responsibilities that
have been entrusted to them. One of these reasons involves a potential conflict
of interest on the part of the executor.
If the executor is also a beneficiary of the estate,
then could this be considered a conflict of interest? If so, is this sufficient
cause for the courts to revoke the executor’s letter of testamentary that
grants the right to serve in this capacity?
Generally speaking, the answers to these two questions
are no and no. The existence of a conflict of interest is, by itself, usually
not sufficient to remove
an executor—but there are important exceptions that should be mentioned.
Differences Between Executors and Administrators
Executor and administrator
are two distinct terms used for the party responsible for managing the
decedent’s estate. There are few practical differences between the two
titles—an executor does more or less the same things that an administrator
does. Technically, however, there is a difference between the two.
An executor is an individual or corporation
named in the decedent’s will as the party selected to govern the affairs of the
estate. However, the named executor does not automatically assume this role
because they have been mentioned in the will. They must be approved by probate
court (in this state, the Surrogate’s Court of the State of New York). Once
this has been accomplished, the court issues a legal document known as “Letters
Testamentary” (Letter of Testamentary) to the executor that they can present to
relevant parties to verify their right to perform their duties.
An administrator performs basically the same
functions as an executor but has been selected by the court rather than the decedent’s
will. Why does this happen? If the decedent left no will, then it is up to the
court to choose the party to manage the estate. In these instances, the
administrator selected by the court will distribute the assets of the estate in
a manner that complies with intestacy laws.
Another type of complication that leads to the
appointment of an administrator arises when the executor named in the will is
unavailable or declines to accept the role, and the will does not name an
alternate executor. When this happens, the court must find a suitable
replacement, usually a spouse or another close relative, for administrator
duty. The court-appointed administrator is given Letters of Administration that officially confirm their
right to manage the estate.
For purposes of this discussion, we will use the term
“executor” to include both of these similar roles.
and administrators both have a duty to manage estate assets appropriately and
to follow all pertinent laws. If they fail to do so, they can be removed by the
probate court. As we shall see, there are instances where a conflict of
interest can be cited to remove
Potential Conflicts of Interest
It is notconsidered an
actionable conflict of interest when a beneficiary of an estate also serves as
its executor. As a matter of fact, this is a commonplace arrangement. When
making out a will, many people opt to name a spouse or a child (18 or over)—who
typically stands to inherit estate assets—to act as executor. In those cases
where the courts must appoint an administrator, it is often a close relative of
the decedent who ends up assuming the duties. The courts do not find anything inherently
wrong with beneficiaries as executors.
However, executors can be removed if it is shown that
their actions violate their fiduciary duties. The executor cannot act in a
purely self-interested way while administering estate assets. They cannot, for
instance, transfer or make a personal claim on estate property that rightfully
belongs to another beneficiary. “Self-dealing”—placing one’s personal
interests over those of the other beneficiaries—is a breach of fiduciary duty
and could lead to the removal of the executor as well as the imposition of
The key, though, is that it is the executor’s actions
that merit their removal. The courts are generally not interested in the ordinary
potential for abuse—they want to see evidence that the executor has failed or
has a very high risk of failing in their duties.
In 2007, the New York Court of Appeals shed light on
the current viewpoint of the law in regard to potential conflicts of interest. In
of Palma, the Appellate Court declined to overturn a
Surrogate’s Court decision to remove an executor who had acted as the personal guarantor of a
loan made by the estate, despite evidence that the loan could not be repaid. In
handing down its decision, the court noted that “a potential conflict of interest on
the part of a fiduciary, without actual misconduct, is not sufficient to render
the fiduciary unfit to serve”but
also that,in this particular matter,“the conflicts [of
interest] are not merely potential, but are real and presently exist.”
furthermore found that “friction, hostility or antagonism between a
fiduciary and beneficiaries can also disqualify the fiduciary, but only when
such enmity threatens to interfere with the administration of the estate.”
In other words, the existence of “tension” between beneficiaries and executor does not, within
reasonable limits, merit the involvement of the courts. (Matter
of Palma, 40 A.D.3d 1157, NY App. Div. 2007)
What Happens if an Executor Is Removed?
The Surrogate’s Court of the State of New York has the
final say on the removal
of an executor. If executors are found to have violated their fiduciary
duties or to be otherwise unsuited to the job, the court will name a
replacement—either the alternate mentioned in the will or, when that doesn’t
apply, a close relative of the decedent.
As an estate beneficiary, you have the responsibility
to contact a lawyer who handles estate litigation and begin filing the relevant
documents with the Surrogate’s Court.
Contact a New York Estate Lawyer Today
and beneficiary conflict of interest cases can be tricky, as
New York State courts prefer not to remove an executor without compelling
evidence of their unsuitability to the role. We’re here to help. The probate
litigation attorneys at Joseph A. Ledwidge, P.C. have 32 years
of collective legal experience in the state of New York. Our estate lawyers
handle a wide variety of cases, from probating wills to removing executors who
violate their fiduciary duties. Call us at 718-276-6656 for a free phone
consultation with an estate
Closing out the estate of a loved one after their passing is easier said than done. You may assume that acting as an executor of an estate is straightforward, but you’ll soon come to find that nothing could be further from the truth.
You should understand what you’re getting into if you agree to be the executor of an estate. Before we go any further, remember this: You don’t have to agree to this. Even if you’d like to help a loved one out, you can always decline their invitation to act as executor.
It takes time: Don’t assume that it only takes a couple weeks to figure everything out. With a complex estate plan, for example, you could find yourself working as an executor for a year or longer. From phone calls to trips to the courthouse, there’s a lot on your plate.
You must have the right skills: Almost anyone can act as an executor, but having the right skills will go a long way in making the process easier on you. In addition to organizational skills, you should have a basic understanding of finances.
Your temperament is important: As the process unwinds, you’ll find yourself dealing with all sorts of people. Some of them are friendly. Some of them are mean. And some of them are looking to take advantage of you. An even temperament allows you to deal with anyone and everyone you come in contact with.
Legal knowledge can help: You don’t need a law degree to act as an executor, but it helps if you have a basic understanding of probate and/or trust administration.
When you understand these points, it’s easier to decide for or against taking on the responsibility of an executor.
If you’re going through this process and have questions, take a step back to get an overview of your situation. The last thing you want to do is make a rash decision, as you could be held personally liable for any mistake.
Acting as an executor is a big responsibility, so treat it as such. If you require any additional information, such as the steps you should take, visit our website for assistance.
Managing someone else’s estate is a time-consuming and complicated task. Many times, it is also a thankless job. Some testators earmark special compensation for the executor of their estate or the trustee managing their trust. Others do not.
Regardless of whether or not an executor receives compensation for the tasks, he or she has a fiduciary duty to the deceased and the beneficiaries of the will or trust.
As an heir to an estate, you have a vested interest in how the executor or trustee performs the job. After all, the money in the trust or the assets from the estate will partially become yours after settling the estate. If you have reason to believe the executor may be stealing or otherwise failing in this important position, you may need to bring a challenge in court .
There are several kinds of theft common in estates
Many people with sizeable estates fail to outline and detail every valuable possession in the estate. They may simply generalize in how they split up assets. For example, one testator could value her jewelry collection at $100,000 and leave all of it to her daughter. However, the executor could easily pocket certain items without anyone discovering it right away. Stealing items of value from an estate is one way an executor can violate his or her fiduciary duty.
It’s also possible for an executor to perform transactions that don’t really benefit the estate. Selling assets or even the home of the deceased are common tasks. However, if the executor knows a real estate agent or a buyer, he or she could sell the home from much under market value to benefit that person (or perhaps to receive a lump-sum fee for the undervalued sale). In this situation, the executor is not acting in the best interests of the estate and the heirs.
Sometimes, executors just can’t perform the duties of the job
Not everyone who does a poor job as executor or trustee is a thief. Some people simply lack the ability to perform the duties of the job. They may live in another city, state or country. The executor could still have a full-time job and children that preclude him or her from devoting adequate time to resolving estate issues. Delays can cost the estate thousands, especially if bills don’t get paid on time.
If you have any reason to believe that the executor or trustee named by a deceased loved one is incapable of doing the necessary job, you may need to challenge the estate or executor in court. Doing so will protect your inheritance and ensure that someone capable of doing all the work ends up named as the new executor by the courts.
Being the executor of an estate is a dubious honor. On the one hand, someone you cared for and probably respected believed that you were trustworthy and intelligent enough to handle the estate. After all, it’s a complex process. On the other hand, it’s a lot of work and stress, often without any kind of extra compensation. Being an executor can strain or even destroy your familial relationships, especially if people in your family don’t think the last will or estate plan was fair to them.
You may think that your siblings or cousins will behave rationally, but money can bring out the worst in people. There’s a saying that blood is thicker than water , but money is thicker than blood. Many families have gotten torn apart by infighting over assets during the administration of an estate. If other heirs or family members want a bigger chunk of the assets, they could try dragging it into probate court and even challenging your position as executor.
Executor challenges exist for a reason
Some people simply let greed get the better of them, while others are just unable to fulfill duties. There are a million valid reasons why family members or heirs would want to challenge an executor. Perhaps the executor lives out of state and can’t come to handle things in a reasonable timeframe. Maybe the executor has done questionable things, like selling property for much less than market value to friends. It’s even possible that assets could come up missing.
When that happens, being able to challenge an executor can protect heirs against getting defrauded. New York probate courts can determine if the executor has failed to perform the duties of the position adequately. If that happens, a new executor or administrator could get appointed by the courts.
Being proactive protects your position
Although getting named executor may mean a lot of thankless work, it can also help you achieve closure. You may feel like you’re helping fulfill the last wishes of someone you loved, which can help with the grief process. The last thing you need is to face a challenge in court. Taking steps early on to protect yourself is the best option.
As soon as possible, release copies of the last will, estate plan or trust to heirs and family members. This way they can see you’re doing the right things. Make a list of assets and debts, and try to get fair prices for all assets. Make sure all financial transactions are handled through the estate’s checking account, which will provide a concrete record if needed in court. Be sure to keep receipts and records of everything from appraisals to tax payments.
Once you have settled all the estate’s debts and filed the final tax return for the deceased, you should send notice to heirs and beneficiaries. Once all the remaining assets have gotten divided, make a point of retaining the records. That way, in case someone complains at a later date, you can prove you followed protocol.
There are a lot of things to worry about when someone passes away. Whether it was a predictable passing, such as from a progressive disease, cancer or an accident, there are financial and legal issues that arise after a death. Someone will need to pay off and close accounts, such as utility accounts and credit cards. Then, there’s the process of handling the actual estate and distributing assets in compliance with the wishes of the deceased. You may feel like there is less to worry about because the person who passed away left an estate plan or last will. Sadly, that won’t prevent serious financial or estate issues.
An estate plan is only as strong as the executor appointed to carry it out . The sad truth is that we are often blind to the worst qualities in the people we are closest to. It’s very possible that someone you loved and respected named an unqualified or unscrupulous executor. The person who passed away probably believed that the executor named was the best selection. However, now that it’s time to handle the estate, it looks like there are a lot of issues. Whether funds and assets are just disappearing or the executor doesn’t seem to know how to handle probate court, you may need to take action.
You can ask the courts to replace an executor
If you have reason to believe that the executor named in the last will or estate plan is not fulfilling his or her duties, the courts may intervene. Probate court can remove an executor who has failed to handle an estate properly. The courts can also name a replacement executor. That individual gets tasked with correcting the issues caused by the previous executor and completing the last wishes of the deceased. Believe it or not, it’s actually very common to challenge an executor. Many estates, especially those with a lot of assets, end up in probate court because of how an executor handles things.
Typically, in order to remove an executor, you need some kind of evidence that the executor can’t or isn’t handling the estate properly. In some situations, public statements like Facebook posts could be used to show an individual intends to profit off of an estate or defraud other heirs. Other times, you may have to carefully review the estate plan or last will and compare it with what has gotten dispersed from the estate. It can be a difficult and protracted process. Unless you contest how the estate is handled, the executor could end up spending, wasting or improperly dividing the estate assets.
Wanting an estate to get handled properly doesn’t make you contentious or greedy. It makes you someone who respects the last wishes of the people you love. If you believe an executor isn’t doing his or her job, you may need to challenge him or her in court.
While many New York residents choose to appoint relatives or close friends to manage their estates after they die, there may be situations in which an individual or couple has no trusted party to appoint. Examples might include couples without children, unmarried individuals without close family, or families experiencing serious conflict over parents’ assets and end-of-life plans. Deciding how to have one’s estate administered could make the difference in ensuring a smooth transfer of assets rather than creating fuel for a huge court battle.
In particular, couples leaving everything to the surviving spouse in case of the death of one should ensure that both partners have meticulous records of relevant accounts. If one spouse tends to handle financial activity more than the other, the less involved party may need to be walked through what to do if the other perishes. There should also be a provision for managing the estate in case of both spouses expiring simultaneously. It is important to recognize that the executor of a will is entitled to collect a fee for their services. A relative might refuse to charge such a fee, but an objective third party is more likely to collect this fee.
Experts note that word-of-mouth recommendations can be helpful in searching for a professional to handle the task of overseeing one’s estate plan. It may also be helpful to explore options such as living trusts for managing resources both during one’s life and after death. Trust administration might be preferable in cases involving certain types of assets or significant amounts of wealth.
Periodic reviews of estate plans can ensure that any important life changes are incorporated into the legal documents. An estate planning lawyer can be of assistance in this regard.
Many people in New York may feel honored when they find out that they’ve been asked to be the executor of a will. Unfortunately, some executors find themselves in legal trouble after making mistakes while attempting to manage an estate.
Some legal experts point out that many will executors are not legal professionals and have little or no experience in managing an estate or trust administration . There have been cases in which executors have been sued by heirs , and if the court decides that an executor has in fact made a mistake in handling the estate, the executor may be personally liable for court costs and any damages. This can cause havoc on the executor’s personal finances.
Executors can protect themselves against lawsuits by taking some basic steps. The first would be to keep extremely careful records of all activities surrounding the disposal of the estate. Executors should keep records of conversations that they’ve had with heirs and keep all receipts, contracts, and other documentation that have been a part of estate management.
Another thing that executors can do is open a separate bank account for estate transactions. This not only demonstrates the executor’s integrity, but it also makes bookkeeping much easier. Finally, executors should ensure that they notify all creditors and heirs as soon as possible after someone dies. This allows everyone who has a claim against the estate to make it in a timely fashion.
Executors who are unsure of their role in handling an estate may benefit from speaking with an attorney. The lawyer may be able to review the will and provide the executor with support and advice regarding his or her responsibilities.
Many people in New York feel flattered when someone asked them to be the executor of the will. Being trusted enough to handle a friend or family member’s posthumous affairs is indeed an honor. However, it’s important for prospective executors to fully understand the possible ramifications of the position.
An executor has several responsibilities. One is ensuring that the decedent’s assets are distributed according to the terms of the will. Others include paying off existing debts owed by the decedent, filing the decedent’s final personal income tax return and paying amounts that are owed to the IRS. Depending upon the size of the estate, federal and state estate taxes may be owed as well.
While all this may sound straightforward, the ability to efficiently settle an estate is often dependent on how well the decedent prepared for his or her eventual demise. If the will is not straightforward about the location of assets, or how assets such as jewelry and family heirlooms are to be distributed, the executor may be caught up in a web of paperwork and family squabbles.
Unfortunately, there been situations in which executors have suffered extreme stress, financial losses and even lawsuits. Litigation can result when a beneficiary of the will doesn’t believe that the executor has done a good job of handling the estate. Executors can also be personally responsible if the estate has been distributed prior to creditors or taxes being paid.
Because of the responsibilities involved, it is important for people to carefully consider whether they want to be an executor under a will. However, they are not expected to be experts, and they are entitled to retain the services of an experienced probate attorney when questions arise.
A New York resident might seek information about a parent’s estate plan through legal avenues, but this could be extremely unproductive. A parent cannot be sued for simply creating an estate plan. In addition to increasing family tensions by suing a parent or their representative, this could provide information to others in the family about intentions with regard to legal battles after that parent expires. A parent is not legally bound to leave their estate to children or grandchildren. The only legal obligation is to a spouse.
A family member who believes that they have been unfairly omitted from a will or trust might contest the validity of the estate plan based on the possibility that a different sibling has exercised unfair influence over that parent during their life. Trust assets may be somewhat more protected because this type of estate plan typically avoids the subjection of included assets to probate. However, a legal challenge might still arise if there is an appearance of another sibling manipulating the situation.
A parent who clearly wants to leave a lesser amount of money to one or more children than to another might want to make an expression of these wishes and their reasoning clear in their end-of-life documents. A lawyer could also coordinate a meeting with all siblings to go over the plans in the presence of the parent to ensure that there is an understanding of these wishes and the reasoning behind them. If relationships are strained, however, this might not be feasible.
In ensuring that one’s wishes will be honored, it may be important to select an impartial trustee to oversee the distribution of assets. Also, reliable legal counsel could be important for ensuring that potential disputes over trust can be addressed clearly. Failure to legally execute any of the documents related to the matter could leave an estate otherwise vulnerable.