23 April 2013 | Comment | Article by Roman Kubiak TEP

How to remove an executor

We discuss the issue of how to remove an executor of an estate.

With our Asset Management team regularly being asked to act in the administration of a large number of estates across England and Wales and our Contested Wills, Trusts and Estates department increasingly receiving questions about how to remove an executor of an estate, we look at a number of recent cases which have addressed the issue of how to remove an executor.

Executors and administrators of an estate (collectively known as 'personal representatives') have an overriding duty to collect in the estate and administer it correctly under s. 25 Administration of Estates Act 1925.

If a beneficiary believes that an estate is not being properly administered then it is possible for them to apply to the court to substitute or remove the personal representatives.

Applications to remove personal representatives are either made before a grant of probate has been issued or after.  Most applications to remove or substitute a personal representative are made under s. 50 Administration of Justice Act 1985 which usually deals with the removal of executors and administrators after the grant of probate.

Until recently there was limited case law interpreting the statute.

Practitioners relied mainly upon the old Privy Council South African case of Letterstedt v Broers [1884]. The case provided the key guidance that the same principles will apply for the removal of personal representatives as will apply to the removal of trustees, and that the overriding consideration is whether the trusts are being properly executed. The main guide for the court was 'the welfare of the beneficiaries'.

Then, in 2010, three cases were heard which provided much needed updated guidance.

Angus v Emmott [2010] EWHC 154 (Ch)

This case highlighted that while friction or hostility between personal representatives and beneficiaries is a relevant consideration, it is not, on its own, a reason to remove the personal representatives.  It is only when the proper administration of the estate or the welfare of the beneficiaries is being adversely affected that removal will be considered.

The deceased had been wrongly convicted of murder and had spent two decades in prison.  The main asset in the estate was the compensation award from the Home Office for wrongful conviction.

The executors were the deceased's lover, Mrs Angus, and the deceased's sister and her husband, Mr and Mrs Emmott.

The judge stated that in this case “there is such a degree of animosity and distrust between the executors that due administration of the estate is unlikely to be achieved expeditiously in the interest of the beneficiaries unless some change is made.”

That change was to remove all of the executors, replacing them with a professional executor.

Kershaw v Micklethwaite [2010] EWHC 506 (Ch)

The judgement in this case was handed down a day after Angus v Emmott and reinforced the view that, to use the words of Newey J in the judgment:

"friction or hostility between an executor and a beneficiary is [not], of itself, a reason for removing the executor.”

This case involved complaints against the executors from the beneficiary that they had delayed in the administration of the estate, that there were potential conflicts of interest, that they had failed to value assets correctly, had failed to identify the boundaries of the land and that there had been a breakdown of relations between the parties. The court considered each argument in turn and dismissed every one finding that they either had no substance or they were not serious enough to warrant removal. Bad relations between the parties was simply not enough.

The court also took into account the fact that the personal representatives were appointed by the testator and so it was considered that she would have given serious thought to their appointment. Consequently, something very serious would have to happen to warrant their removal.

The judge also commented on the practical issue of costs, pointing out that changing the personal representatives would increase the administration costs significantly.

Alkin v Raymond and Whelan [2010] WTLR 1117

In this case the court ordered the removal of the executors because an invoice for £163,000, said to be a debt of the estate, payable to a company controlled by one the executors did not hold up and was considered inconsistent with previous invoices.  The court held that the invoice related to the overheads of the executor's company and had not been approved by the deceased before his death.

This was held as serious enough to justify removal of, not only the executor in question, but also his co-executor who had supported the payment of the invoice.

Other complaints, including a complaint that one of the executors had acted inappropriately by suggesting that one of the beneficiaries should have cosmetic surgery and by sending her lingerie as a Christmas present, however, were rejected as being without substance.

The conclusion from this case is that where there is clear evidence of misconduct, an application for removal should succeed, but again, friction and hostility alone were not enough.

Since 2010 two further notable cases dealing with the issue of removing executors have been before the court.

Khan v Crossland (unreported)

An unreported case, this involved a claimant who sought the removal of an executor named in his father's will before a grant had been issued.

The claimant and his sister, who were the beneficiaries of their father's estate, had agreed between themselves how they wanted the estate to be administered, which included an agreement that the claimant should administer the estate.  However, the defendant, who was the named executor, refused to stand down.

In this instance, as the claimant was seeking removal before the grant of probate had been obtained, he sought to remove the defendant using the procedure under s.116(1) Senior Courts Act 1981, citing the following reasons:

  • The claimant and co-beneficiary were adults.
  • They had agreed how to dispose of the estate.
  • They had lost all trust and confidence in the defendant's ability to administer the estate.
  • The court's discretion to pass over an executor was a wide one.

Notwithstanding the defendant's arguments particularly that this would have serious consequences for the probate system generally, the court granted the claimant the application to pass over the defendant as an executor and appoint the claimant in his place.  The court gave the following reasons:

  • The court's discretion was very wide.
  • There was no need for an executor to be discredited before an order for his removal could be made.
  • The testator's choice of executor was relevant, but not decisive.
  • The reason behind the testator's choice of executor was not known.
  • The beneficiaries were adults who were both of sound mind and unanimous in their desire to have the executor passed over.
  • The relationship between the opposing parties had broken down.

Goodman v Goodman [2013] All ER 118

The most recent of the notable cases in this area involved an appeal against a decision to remove an executor under s.50 Administration of Justice Act 1985. The rationale for the appeal was that the incorrect procedure had been used by the claimants.  As this was an application to remove an executor before the grant had been obtained, it was argued that the procedure under s.116 Senior Courts Act 1981 should have been used.

The court upheld the first instance decision and found that an application to remove an executor under s.50 Administration of Justice can be made before a grant has been obtained.

Conclusion

These recent cases have given valuable, if not sometimes confusing, guidance on what the court will consider serious enough to warrant removal of personal representatives.

However, each case will turn on its own facts and there must be clear and compelling reasons that would adversely affect the administration and the welfare of the beneficiaries.  Bad relations alone will not usually be enough.  The court will take into account both the fact that the testator has chosen their personal representatives, therefore upholding the principle doctrine of testamentary freedom, and the costs of removing and replacing them.  A potential applicant must consider whether it would be a proportionate cost for the estate to meet.

Finally, the most recent decision in Goodman suggests that an application under s.50 Administration of Justice Act 1985 can be made both before and after a grant.

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