Passing over an Executor

In October 2002 Keith Crane died in Townsville, Queensland of metastatic bowel cancer. He made a will in July 2000 appointing his sons, David and Kevin, as executors and trustees of the will. He left specific items to his sons with the residue of his estate after the payment of expenses going to David and Kevin in equal shares.

David asked the Court for an order that Kevin be passed over as executor of the estate arguing that there is a dispute between the estate and Kevin about the ownership of three significant assets.

Until shortly prior to this death, Keith was the owner of four shops in Mount Barker valued at $410,000. Six days before his death, Keith sold the Mount Barker shops to Kevin for the sum of $100. Similarly, six days before he died Keith sold a caravan to Kevin for the sum of $100. David argues that at the time of these transactions Keith lacked the capacity to enter into this arrangement arguing that it occurred due to the undue influence or unconscionable conduct on the part of Kevin. The third asset in dispute is an alleged debt of $150,000 that Kevin owed Keith following the transfer of a property 3 years before Keith died – Kevin didn’t pay for the property and subsequently sold it for $250,000.

The Court had to decide if it had the power to remove an executor who has been given a grant of probate.

The Court will not readily pass over a named executor, however there are “special circumstances” where an executor may be passed over; where this occurs the Court must take into account the interest of the beneficiaries and proper administration of the estate; Courts have passed over an executor or revoked a grant of probate on various grounds including:

  • The executor was of bad character, had been convicted of manslaughter in relation to the death of the will maker and was in prison.
  • The executor had neglected his duties.
  • The executor had intermeddled in the estate and refused to take a grant.
  • The executor was absent overseas.
  • The executor was suffering from ill health.
  • The executor was of unsound mind.
  • The executor was not competent to take probate.
  • The executor had disappeared.
  • The estate was insolvent.

 David gave evidence that in October 2002 Keith found it increasingly difficult to talk or to maintain a conversation. He was on liquid morphine and when not unconscious was hallucinating. However Kevin submitted a medical report from the Director of Palliative Care at the Townsville Hospital, who expresses the opinion that there was no evidence that Keith’s judgment would have been impaired by medication or his disease in October 2002.

The Court having regard to the due and proper administration of the estate and the interests of the beneficiaries believed that as Kevin continued to maintain that the transactions involving the Mount Barker Shops and the caravan are legally effective and that he owes no money to the estate, If made an executor, the Court believed that Kevin would not consent to the estate asserting rights in relation to the three assets. Therefore litigation in relation to one or more claims is likely and for these reasons, the Court ordered that Kevin be passed over as executor of the estate.

 

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s