Executors are the people named in Wills who are tasked with administering the deceased’s estate. Executors have the task of ensuring that testamentary wishes of the person making the Will (the testator) are carried out on their death.
It is, therefore, very important that executors are trustworthy, reliable and responsible.
The role of an executor is of even greater importance and more onerous if the estate they are to administer is of significant value and has complex issues within it to deal with.
Wealthy and complex estates often have various assets which require a certain level of expertise and skill to administer.
For example, a business man or woman will potentially have a number of business assets and interests within his or her estate. An executor of such an estate must have the requisite skill, knowledge and expertise to deal with such assets.
It is common for individuals to choose spouses, children, family members and close friends to act as executors. With complex estates, however, the testator must consider whether this type of appointment of an executor is appropriate.
An executor of an estate which contains business assets must have the ability to continue the running of the business, represent the estate interests at board level and be able to wind up the company.
The executor must also be able to decide the correct approach for the business and the estate and be able to act upon their decision.
The testator may consider appointing a fellow director, shareholder or partner as an executor. This would be on the basis of that person having first hand knowledge of the day to day running of the particular business.
The testator must, however, consider that there could be a conflict of interest in these circumstances. If a fellow shareholder is appointed as an executor the interests of the estate may conflict with their own interests in respect of their own shareholding.
It may be more advisable for an independent expert to be appointed as executor to represent the estate when dealing with business interests.
It is, therefore, of great importance to choose executors carefully. This is of even greater importance if the estate is significant, complex and contains business assets.
Expert legal advice should be sought on this matter and all matters relating to Wills and succession planning. The Private Wealth Team at Goughs is well placed to provide this advice.