Fairness to Estate Beneficiaries
You are surprised to learn that while you are included in your sister’s will, you are getting less than you thought you would based on past conversations between you and your sister. Something about this doesn’t feel right—it’s not so much that you’re getting less than you thought, it’s that you think the executor of the will may have ripped off your sister. To get to the bottom of the issue, you decide to investigate.
A Los Angeles or San Francisco Bay area lawyer can work with you to ascertain if your suspicions are valid.
What Makes a Will Valid?
A valid will must meet a few basic requirements.
- Sound mind and legal age: The person whose will it is, better known as the testator, must be 18 years of age or older and of sound mind—that is, mentally fit to make a will
- Holographic Will: The testator must compose this type of will entirely in his own handwriting. The testator must sign it, but it does not require witnesses, and the testator need not date it.
- Typed or form will: If the will is not completely in the testator’s handwriting, it must be typed, or the blanks must be filled out using a fill-in-the-blanks will. Both require the testator to sign and date it. At least two witnesses who do not have an interest in the will must sign it.
If a court invalidates a will, the probate court will determine how to distribute the deceased person’s estate.
What Constitutes an Executor’s Duties and Rights?
If you determine that the will in question is valid, the next step is to determine what rights and obligations the executor owes to the beneficiaries. The American Bar Association aims to educate executors on their duties and rights as well as beneficiary rights.
Before beneficiaries file suit, however, they need probable cause. Lawyers who draft wills for their clients often put in a No Contest Clause, which means that if you do lack probable cause to challenge the will, you may not collect anything whatsoever from the will.
Duty to settle the estate. The court will task the executor with paying off the remaining debts and obligations owed by the estate. Executors will also locate and collect any assets belonging to the estate. Lastly, they will distribute assets to the beneficiaries in compliance with the instructions of the will as well as any laws that may affect distribution.
The duty of prudence/care. The duty of prudence, otherwise known as the duty of care, requires the executor to act in a reasonable manner by contorting their behavior to standards of the average executor. In other words, they must take the necessary precautions to make sure they administer their duties in compliance with the testator’s instructions. Moreover, executors must not make too many high-risk investments, fail to pay obligations of the estate, or otherwise expose the estate to possible lawsuits. Since many executors are ordinary people with no specialized legal or investment expertise, their duty is to act as other executors would act based on a similar set of circumstances.
Duty of loyalty. This duty requires the executor to do what is best for the estate and not make decisions that would benefit the executor instead of the beneficiaries. In other words, executors may not self-deal. If a disagreement arises between people whom a will names as beneficiaries, the executor must treat all people fairly when trying to settle the matter. What is important to note here is that fair does not mean the same thing as equal. In other words, unless you can prove that something else is afoot, you cannot go to court and use the fact that you did not get an equal share to claim unfairness. This said, if you can point to something else that might indicate unfair treatment, you can go to court and try to resolve the matter.
The exception to the rule. It is not considered self-dealing when professional executors receive fair market value for services rendered to the estate. They may also get paid back if they must defend the estate before a court, provided that they exercise good faith in trying to defend the estate. Finally, an executor may pay a professional investment counselor to advise the executor about how to best take care of the estate.
Duty to diversify. The duty to diversify is part of the duty of care, but it is important enough to mention in its own right. This duty requires the executor to invest an estate’s assets in both safe and higher yielding investments. They must also make different investments using stocks, annuities, bonds, and passive and active investments funds.
What Are My Rights if the Executor Has Violated His Duties?
If you think that the executor is not up to the job, either due to negligence or an intent to harm the estate, you can:
- Sue the executor: If the executor misappropriated or lost any money or property due to lack of care, you can sue the executor to get it back.
- Remove the executor: You may ask the court to remove the executor and have the court appoint a new one.
Consult an Experienced California Estate Planning Attorney at Hackard Law
The attorneys at Hackard Law stand ready to fight against executor fraud or negligence in the San Francisco Bay area, the Los Angeles area, and the rest of California.
If you suspect an executor has violated your beneficiary rights through malice or neglect, reach out to the legal team at Hackard Law to determine your next move. You can reach us by calling (916) 313-3030 from Santa Clara or (213) 357-5200 from Los Angeles, or contact us online= to schedule an initial consultation.