What responsibilities do executors owe beneficiaries?
An estate lawyer is a bar certified attorney who specializes in estate planning and assists clients in drafting and implementing legal documents, including wills and trusts. Estate law is closely related to family law, since lawyers often must work with related individuals who are involved with an estate.
The executor of a will has a fiduciary duty to act in the best interest of the estate. This means that the law prevents you from acting in your own interest to the detriment of the estate. As an extension of this duty, executors also have several responsibilities to the beneficiaries of the will.
The best way to avoid issues with the beneficiaries of an estate is to communicate clearly and frequently throughout the process. If beneficiaries feel like they have a good idea of how you’re handling the estate, there is much less of a chance for concern or frustration. Tips for Planning Your Estate
Estate lawyers gain much of their specific estate planning knowledge through on-the-job experience, mentorships and continuing education. Along with having advanced knowledge of the legal system, you should be well versed in the Uniform Probate Code, which imposes rules and limits on wills and trusts.
Specifically, fiduciary duties may include the duties of care, confidentiality, loyalty, obedience, and accounting.
Three Key Fiduciary DutiesDuty of Care. Duty of care describes the level of competence and business judgment expected of a board member. ... Duty of Loyalty. Duty of loyalty revolves primarily around board members' financial self-interest and the potential conflict this can create. ... Duty of Obedience.
If a fiduciary fails to comply with these responsibilities, they may have breached their fiduciary duty. In the case of an executor or trustee, a breach of fiduciary duty may result in their suspension, removal and/or a surcharge – a court order requiring them to pay money damages for the harm caused by the breach.
Some examples of fiduciary duties include duties of undivided loyalty, due diligence and reasonable care, full disclosure of any conflicts of interest, and confidentiality. While a fiduciary duty may be violated accidentally, it is still a breach of ethics.
All agents are held to a standard of care, including six fiduciary duties: Loyalty, Confidentiality, Disclosure, Obedience, Accounting and Reasonable Care & Diligence.
These relationships are called fiduciary relationships. They include solicitor/client, physician/patient, priest/parishioner, parent/child, partner/partner, director/corporation and principal/agent relationships. Fiduciary relationships involve trust and confidence.
Breach of Fiduciary Duty ExamplesSharing an employer's trade secrets;Failing to follow the employer's directions;Improperly using or failing to account for employer funds;Acting on behalf of a competitor;Failing to exercise care in carrying out duties; and.Profiting at the employer's expense.
A breach of fiduciary duty occurs when a principal fails to act responsibly in the best interests of a client. The consequences of a breach of fiduciary duty are multiple. They can range from reputation damage to loss of a license and monetary penalties.
Breach of fiduciary duty offers a wonderful panoply of remedies: legal remedies, equitable remedies, a right to an accounting, an award of money damages, disgorgement of self-dealt profits, and finally, if pled derivatively, the potential to recover attorneys' fees.
Personal Liability In some cases, a fiduciary can be held personally liable if they violate their duty. For example, if a guardian breaches his or her fiduciary duty owed, he or she can be held personally liable for the resulting damages.
The definition of a fiduciary is an individual who has a legal obligation to act in the best interest of another person. As such, a fiduciary will disclose any conflicts of interest that arise and resolve them in the client's favor as well as avoid using the client's assets in any way for their own benefit.
What is the fiduciary rule? The fiduciary rule is a regulation underpinning fiduciary duty, or the legal requirement for financial advisors to work in their customers' best interest.
Estate lawyers help outline the distribution of property and management of assets after a person's death. Read on to learn more about what estate lawyers do and how you can enter this profession.
Estate lawyers gain much of their specific estate planning knowledge through on-the-job experience, mentorships and continuing education. Along with having advanced knowledge of the legal system, you should be well versed in the Uniform Probate Code, which imposes rules and limits on wills and trusts.
As of March 2021, Payscale.com reported that estate planning attorneys made a median annual wage of $78,000. According to the BLS, the job outlook for all lawyers will increase 4% for the years 2019 to 2029.
Key Skills. Analytical, interpersonal skills, good at problem-solving, research, speaking and writing. Work Environment. Private or corporate offices, may attend meetings at hospitals, prisons or the homes of clients. Similar Occupations.
You owe it to beneficiaries to distribute estate assets promptly. The definition of “promptly” varies across state lines, with some implementing a year deadline while others do not have a written time limit. This does not mean you must rush to distribute assets, just that you should not waste time.
As soon as possible, let beneficiaries know about their status in their loved one’s estate. Informing them of their status lets them contest the will if they take issue with its contents. While notification methods vary from state to state, a good bet is to send beneficiaries a document.
Beneficiaries also have a right to access details about probate court and the estate. If asked, you must share the estate’s contents and debts and how you plan to clear those debts. Rather than provide in-depth financial statements, you satisfy this obligation by keeping beneficiaries in the loop regarding your activities.
You need not distribute assets as soon as you send out beneficiary notifications. It may take several months before beneficiaries receive anything from the estate, and you may need to prioritize clearing debts before distributing assets.
Estate planning attorneys, also referred to as estate law attorneys or probate attorneys, are experienced and licensed law professionals with a thorough understanding of the state and federal laws that affect how your estate will be inventoried, valued, dispersed, and taxed after your death.
Setting up any trusts you might need to protect your assets, both for your own benefit during your lifetime in the event of incapacity, and for the benefit of your beneficiaries after your death
Neither Protective Life nor its representatives offer legal or tax advice. We encourage you to consult with your financial adviser and legal or tax adviser regarding your individual situations before making investment, social security, retirement planning, and tax-related decisions. For information about Protective Life and its products and services, visit www.protective.com .
In fact, a good estate planning attorney may be able to help you avoid probate court altogether, but that largely depends on the type of assets in the deceased's estate and how they are legally allowed to be transferred.
When a beneficiary calls and a lawyer chooses to engage in a conversation, the lawyer must walk a careful line between providing general information about the estate (which is okay) and providing legal advice to a beneficiary (which is not okay). Another consideration at play is the attorneys’ fees.
Although it seems elemental, the first step for any lawyer in any case is to identify the client. In a probate matter, the estate’s attorney generally represents the Personal Representative, in his or her fiduciary capacity. What does that really mean?
So what’s a poor confused beneficiary to do? If you are an estate beneficiary, and you are confused by what’s going on or suspect foul play, the best thing you can do is to hire your own attorney. Your attorney can explain the probate process to you, obtain information from the estate’s attorney in an efficient way and, if necessary, file reasonable and legally sound pleadings on your behalf. Ultimately, this approach will not only make the estate lawyer’s job easier – it may also save the beneficiaries a considerable sum of money at the end of the day.
No one, unless a beneficiary decides to obtain counsel. Unfortunately, some beneficiaries think the estate’s lawyer represents them too. For free. As a result, they call the lawyer’s office. And call. And call again.
So that beneficiary, and any other beneficiaries who will receive percentage distributions, will ultimately receive less money. Since, again, the lawyer represents a fiduciary and must seek to act in the estate’s best interest, often it is in the estate’s best interest if the lawyer does not communicate excessively with the beneficiaries.
A lawyer’s time is considered an expense involving estate administration. In Washington, these expenses are prioritized ahead of any estate distributions to the beneficiaries.
Otherwise, one problematic beneficiary can unfairly reduce the other beneficiaries’ distributions. Also, unfortunately, some beneficiaries who suspect that they are being shafted by the estate choose to take matters into their own hands.
An executor’s biggest responsibility to beneficiaries is to notify them that they are, in fact, beneficiaries. Beneficiaries have the right to know they’ve been included in a will early on in the probate process. That way, they have a chance to contest anything they have an issue with.
In addition to formal notification, the beneficiary also has a right to information about the estateand the probate process. This includes what assets are in the estate, how much debtthe estate has and how the executor plans to pay that debt.
The court gives these rights to protect beneficiaries and to ensure executors are able to do their jobs effectively. The best way to avoid issues with the beneficiaries of an estate is to communicate clearly and frequently throughout the process.
The executorof a will has a fiduciary dutyto act in the best interest of the estate. This means that the law prevents you from acting in your own interest to the detriment of the estate. As an extension of this duty, executors also have several responsibilities to the beneficiaries of the will.
A living trustis an estate planning tool that can eliminate the paperwork and headache of the probate process. By placing your assets in your living trust, your successor trusteecan supervise the transfer to your beneficiaries.
Executors are tasked with ensuring beneficiaries receive their bequests, but is that their only responsibility to beneficiaries?
Executors are also under no obligation to include beneficiaries in the decision-making process. While it’s a good idea to keep beneficiaries up to date on the process, executors have authority from the court to make decisions about how to manage the estate.
Executors and Trustees must keep beneficiaries informed of the beneficiary’s status and the terms of the Will or Trust. As mentioned, the duty of an Executor to communicate is overseen by the Court. A Trustee, however, is free to act without Court supervision and some Trusts allow the Trustee to act with minimal communication to the beneficiaries.
Because most of us do not know what to do when you are a beneficiary of an estate, you may consider hiring counsel to represent you is if you are concerned about the ability or capacity of the Executor or Trustee to carry out their duties.
If you have a question as to what you should be receiving or what your share should be made up of under the Will or Trust, you may want to hire an attorney to explain the terms of the Will or Trust to you. In addition, that attorney can explain the laws in the state and the characteristics of the different types of property ...
Generally, in order to have a valid Will, a person must have had the ability to understand that she was intentionally creating a Will or Trust. In other words, she wanted to write a Will and leave instructions on how her money and property should be given when she dies.
Generally speaking, the law of the state where your loved one resided or died will determine who should inherit and what the pro-rata inheritance is for each heir. Without a Trust or Will, someone must initiate the process on behalf of the loved one’s Estate to determine the heirs.
If there is no estate planning document (s). If you believe you are a beneficiary or heir to someone who has died, but your loved one did not have a Will, Trust, or any writing designating beneficiaries, then the Court may need to be involved to determine who should inherit from your loved one. This process is often known as a Determination ...
Sometimes, an Executor must obtain signed waivers from all named beneficiaries under a Will or beneficiaries at law (if the Will is not considered valid) in order to proceed with the probate (administration) of a Will. Before signing a waiver, you should talk to an attorney before you give up your rights. Simply being named as a beneficiary ...