Duties of personal representatives (Administration of estates)- FS

Question 1

What is the primary statutory duty of personal representatives under the Administration of Estates Act?

Answer 1

Under section 25 of the Administration of Estates Act 1925, personal representatives must collect in, manage, and administer the deceased’s real and personal estate according to the law.

Question 2

Definition: Devastavit

Answer 2

A breach of duty by a personal representative that causes financial loss to the estate. It leads to personal liability for the lost value, regardless of whether the breach was intentional or negligent.

Question 3

What is the legal test for devastavit?

Answer 3

Whether the estate has suffered a loss caused by the personal representative’s breach of duty, not whether the representative was personally culpable or had bad intent.

Question 4

List: Examples of Breaching Section 25 Duty (Leading to Devastavit)

Answer 4

1. Failing to protect the value of assets (e.g., selling below market value)
2. Failing to distribute the estate to the correct beneficiaries
3. Failing to repay estate debts in the correct order
4. Neglecting to insure or safeguard property

Question 5

What are the consequences of a devastavit claim being successful?

Answer 5

The personal representative is personally liable to reimburse the estate for the loss suffered, out of their own assets.

Question 6

List: Core Duties of Personal Representatives (in addition to Section 25)

Answer 6

1. Ascertain and settle the deceased’s debts and liabilities
2. Calculate and pay any inheritance tax
3. Distribute the estate in accordance with the will or intestacy
4. Produce full estate accounts for residuary beneficiaries

Question 7

What must estate accounts provided to residuary beneficiaries include?

Answer 7

• All assets collected
  
  • Debts and liabilities paid
  • Expenses incurred
  • The residue remaining for distribution

Question 8

What is an example of a breach of duty by a personal representative that could result in personal liability under the devastavit principle?

Answer 8

Selling a significant estate asset (such as real property) for substantially less than market value, especially against professional advice, may amount to a breach of the duty to protect estate assets under section 25 of the Administration of Estates Act 1925. This breach can lead to a devastavit claim, making the personal representative personally liable for the financial loss to the estate.