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Workshop: To renounce or not to renounce
Ashton Davies and Samantha Ewing discuss considerations the professional executor must make when invited to renounce
Few practitioners will have failed to hear criticism (whether warranted or not) of the conduct of executors. Uncommunicative, uncooperative, too slow, and in the case of professional executors, too expensive are the common complaints made against those who have been appointed by the deceased to deal with their affairs.
When prior to the issue of the grant of probate the criticisms levelled at the executors are justified the remedy available to the beneficiaries is to invite the executors to renounce. In the event that the invitation is rejected it is open to the beneficiaries to make a section 116 (of the Supreme Court Act 1981) application to pass over the nominated executor in favour of another.
After the grant of probate has been issued the equivalent remedy available to the Beneficiaries is to make a section 50 (of the Administration of Justice Act 1985) Application to have the Executor removed.
However what if there is no overt conduct by the executor which calls into question their suitability or their ability in general to discharge their duties and obligations? What should the executor do if at an early stage he or she is simply approached by the beneficiaries who wish to deal with the administration themselves or who wish to appoint alternative solicitors to deal with the matter?
This situation arose for the appointed executors in the case of Khan V Crossland [2012] WTLR 841. Before this case it was generally felt that without some positive evidence of unsuitability and/or poor conduct by the executors such an application would fail.
The beneficiaries were brother and sister. They were agreed as to how their father's estate should be distributed and were united in their wish that the appointed executor should not act. They approached the appointed executor (a will writing company) and invited them to renounce principally because they were concerned about the fee estimate provided by the executors for dealing with the administration of the estate.
The executor refused, their position being that they had been appointed by the deceased and there was no reason for them to renounce as they had not acted in a way that was likely to be considered unreasonable or inappropriate. The impasse resulted in a section 116 application by the beneficiaries to pass over the executors.
The application was successful. The court held that the factors to be considered were analogous to a section 50 application and concluded that on balance the case for passing over the executor was greater than the deceased's express wish that his chosen executors administer the estate.
The immediate consideration for the probate practitioner as executor therefore is whether they should always agree to renounce if invited to do so at an early stage.
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CHECKLIST Considerations When faced with this situation the appointed executor must consider whether there is a benefit to the estate, to the deceased, and to other beneficiaries by resisting such an invitation. Furthermore if a residuary beneficiary is disgruntled by an executor’s behaviour it is almost inevitable that any fees claimed will be challenged. Duty to the client It should not be forgotten that a duty of confidentiality remains to the client. Professional Executors may have been appointed specifically to maintain that confidentiality. In the event of an application evidence ?of those confidential issues is likely to ?hold sway. Matter of choice Furthermore weight will be afforded to the fact that the appointment is a matter of choice for the testator. The decision to remove will not be made lightly if there is evidence that there was a longstanding solicitor/client relationship. The decision in the Khan v Crossland case was in part due to the fact that there was no pre-existing relationship between the deceased and the appointed executors and their appointment was simply one of convenience. Why were you chosen? An important issue which the court could not ignore would be the reason for your appointment. Was the testator conscious of the likelihood of disagreement if others were appointed? In Khan the court took account of the fact that there was an undisputed unity between the beneficiaries. Any obvious discord may very well have altered the decision of the court whose concern was to ensure the proper administration of the estate and the welfare of the beneficiaries. Attendance note As with the majority of contentious probate matters your file is going to be scrutinised by all concerned. It is therefore essential that a proper note is made of any wishes expressed by the testator. If the testator wishes you to be appointed ensure that a note is made of the reason why together with corroborating evidence where possible. Fees One of the reasons for the application in Khan was the fee estimate for the administration which the beneficiaries considered excessive. The court chose not to concern itself with the issue of fees and as such it is not considered a sufficient reason to warrant the passing over of the appointed executor. |
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