This article was was written by Robert Horsey and Helene Hauskeller from our Disputed Wills and Trusts Team.
This article was originally published in the Gazette, please click here to view the article.
Issues relating to the suitability and performance of executors (or administrators if there is no Will) arise surprisingly often in the administration of an estate. In such cases, the parties could consider the removal of the person concerned to allow for the effective administration of the deceased's estate.
The most common situation is a breakdown in trust and confidence between the executor and another executor and/or a beneficiary of the estate.
Under section 116 of the Senior Courts Act 1981, it is possible for a beneficiary (or indeed another executor) to request that the court remove or substitute executors before they have taken out a Grant of Probate. Alternatively, it is possible to have the offending executor removed or replaced under section 50 of the Administration of Justice Act 1985 (whether before or after the Grant has been issued). In both cases, the basic principles applied by the court in determining whether or not to exercise its discretion to remove the executor is effectively the same.
The fact that the executor was chosen by the testator will always be taken into account by the court, but the court's overriding considerations are the welfare of the beneficiaries and whether the estate is being properly administered in their interests. The key practical question for the court is therefore whether the executor's continued involvement in that role will impede the administration of the estate.
The courts have previously held that hostility between executors, or between executors and beneficiaries, will not be enough of a reason to justify the removal of an executor. This was restated in the 2018 case of Haynes v Andre, where the court held that there must be a material risk that the hostility will adversely affect the administration of the estate.
In another 2018 case, Nwosu v Nwosu, the court was prepared to exercise its discretion to remove the executors and appoint an independent third party. In that case, the administration of what was a relatively straightforward estate had been ongoing for over five years and the executors could not agree how to proceed, so the estate was, in effect, in deadlock. The court concluded that the only way to effectively move forward was to have the conflicting executors removed and a third party substituted in their place.
Applications to remove a personal representative can be protracted, and legal costs of a contested matter can run to many tens of thousands of pounds. In contrast, if dealt with by consent, the application can be dealt with by the courts on the papers alone in short order and at minimal cost.
Examples of cases where removal might be sought could range from a practical need for a change of executors on health grounds to fiercely contested situations between family members involving allegations of conflicts of interest and even criminal behaviour.
A recent, unreported case in the High Court in Cardiff involved a dispute among the deceased’s four siblings, two of whom (the two defendants) had been appointed as the executors.
The two claimant siblings sought the removal of the defendants and their replacement by a solicitor in a third party solicitor firm. The grounds for the application were that:
The court was satisfied that the defendants should be removed and appointed the replacement independent professional executor in their place.
This case also included an option that can occasionally be useful: the appointment of the replacement personal representative as a judicial trustee. A judicial trustee can seek directions from the court by letter only, which would avoid the need to make formal applications back to court each time the court's assistance is required.
In an ideal world when problems arise in connection with the acts or omissions of a personal representative, the parties would reach agreement so that any subsequent action can be taken by consent. However, if consensus cannot be achieved, legal advice should be sought at an early stage so that appropriate action is taken to minimise costs and ensure the effective conclusion of the administration of the estate.
Contact our Disputed Wills and Trusts Team on freephone 0800 0931336, or by email willdisputes@ashfords.co.uk for a no obligation chat to see how we can help you.
