4): The Law and Practice Relating to Personal Representatives and Trustees in the Administration of Estates and Consequent Trusts. Flashcards
The rights, powers and remedies of beneficiaries of wills and consequent trusts. (6 cards)
What rights does a dissatisfied beneficiary or creditor have against a personal representative (PR)?
Can take legal action in the following ways:
Prevent the issuing of a grant of representation.
Compel the issue of a grant if it’s being delayed.
Seek a court order to replace an unwilling executor with another person.
Compel due administration, including:
Accurate keeping of accounts, receipts, and records.
Application to court for guidance on PR’s duties.
Sue the PR for breach of duty (e.g. mismanagement, failure to distribute correctly).
What defences are available to PRs against such claims?
S.61 Trustee Act 1925: Court can relieve PR from personal liability if they acted honestly, reasonably, and ought fairly to be excused.
Exclusion clauses: A will may limit or exclude a PR’s liability.
Beneficiary consent: If a beneficiary knowingly consents to a breach, they cannot later claim against the PR.
S.27 Trustee Act 1925: PRs are protected if statutory advertisement procedures for unknown creditors have been properly followed.
What can a beneficiary do if a PR wrongly distributes assets?
Proprietary claim (in rem): To recover the asset unless the recipient was a bona fide purchaser for value without notice.
Personal claim: For compensation from the wrongful recipient of the asset.
When does a PR become a trustee of a will trust?
A PR becomes a trustee:
Once the administration is complete, or
Upon a formal assent (act of transferring property to a beneficiary).
What is an assent in the context of estate administration?
An assent is the legal act by which the PR transfers a legacy or part of the residuary estate to a beneficiary.
It marks the end of the PR’s role and the beginning of the PR’s role as trustee (if required by the will).
What happens after the distribution of the estate?
If the will creates a trust, the PR will act as trustee for the ongoing management of that trust.
Statutory and common law rules on trustees apply to such will trusts (see principles of trust law).
