When a person dies they usually leave behind a Will that specifies what is to happen to their assets upon their death and who are executors; that is the person (or people) whose role it is to secure and distribute assets of the deceased and ensure the terms of the Will are carried out lawfully.
The role of executor is an important one, they are required to:
- notify banks and other organisations and the ATO;
- ascertain and control of all assets;
- identify beneficiaries and determine what their entitlement is according to the Will;
- obtain a grant of Probate;
- paying liabilities and any other estate claims;
- attending to the distribution of estate assets which may include the sale of real estate;
- and even take possession or control of the dead body.
Usually the appointment of someone who is trustworthy and responsible is ideal for the role of executor.
So what happens if your chosen executor dies before you do?
They obviously cannot help administer your estate - they are dead!
In a professionally drawn Will a number of alternatives are available. The initial role of executor may be filled by 2 or more people; for example if 3 people are nominated as your executor and 1 has died the remaining 2 can carry on.
Perhaps you do not wish to appoint someone else alongside your spouse to administer your estate upon your death, what then?
You may appoint any number of substitutes to the role of executor. For example you may appoint your spouse as your executorbut in the event they fail to survive you then you wish to appoint your friend/neighbour/accountant/solicitoras your executor.
There are some important drafting tips when considering a substitute clause and lawyers advice is essential.
If, however, you die and your chosen executor has died before you (and let's assume that no substitute or alternative executor has been nominated in your Will) then your estate will need an administrator (similar to the situation you would encounter if you had no Will at all).
The risks however, are that the South Australian State Parliament have set out, in priority, who will be your administrator. This may of course not be who you would have chosen and may not even be a family member with the Public Trustee often being appointed. Alternatively, you may be happy with someone, anyone, administering your estate but in certain cases the costs and delay created by there being no executor will disrupt the administration of your estate and the ultimate benefit received by your beneficiaries.
The moral of this blog is to seek experienced advice from a solicitor who practices in estate planning, when drafting your Will.