Co-executors and How It Works
Nominating more than one person to be in charge of your estate can sometimes be a terrible idea, and not just because of a possible fallout between the co-executors but the fact that it can take a major hit against the pockets of the estate. When someone dies leaving a last will and testament, the person named as the executor must be officially appointed by the Surrogate’s Court to handle the management or liquidation of the decedent’s estate. The executor is charged with liquidating bank and brokerage accounts, selling real estate, operating the deceased’s business, ensuring all liabilities of the estate are paid off, transferring funds and assets to the beneficiaries, as well as other tasks that need to be handled during the probate process.
Understanding the Co-Executor Relationship
Nominating co-executors in your will simply means having two or more executors on board in charge of your estate. The following occurs in a co-executorship relationship:
- The co-executors work together on making decisions concerning your estate, such as selecting the estate lawyer to probate the will, choosing the real estate broker to sell real estate, agreeing to a listing price and ultimate sale price of the real property, distributing assets to the beneficiaries, setting up trusts (if instructed by the will), and all other pertinent estate matters;
- Each co-executor is entitled to an estate lawyer of their own choosing. Although its common for co-executors to share one attorney, they are not obligated to do so. When the parties have a difference of opinions, an attorney representing both executors can no longer do so due to a conflict of interest. At this time, one party (or both) can either proceed pro-se or hire a new lawyer.
- Legal fees for each of the executor’s attorney are an expense of an estate. Having two executors could mean double the attorney fees.
- Executors are entitled to estate commissions for any monies they pay out to the beneficiaries. Two executors equal double the commissions.
- One executor cannot move forward without the other’s cooperation. Both signatures are required to sell property, open an estate bank account, and for other legal undertakings. If parties cannot agree, estate litigation typically ensues.
Why Have Co-Executors
In the event that you have assets that require different levels of expertise, you may consider naming co-executors. Suppose you own an online business and a home. Running a business takes a deep understanding of the inventory, client base, marketing, and the day-to-day operations. In this instance, you can name your business partner or someone who is computer or business savvy to settle that aspect of your estate. For the real property, you can name a family member or a trusted friend to serve as co-executor.
An estate can sometimes be so complicated that it requires professional management similar to a small business or a company. It such a situation, you would want appropriate managers involved to handle your “small business” which in this case would be the estate.
If you have a simple estate, a co-executor is not necessary. An individual executor and an accompanying probate lawyer is typically an adequate dynamic to settle an estate. A New York City Probate Lawyer knows which vendors and firms to contact in specific circumstances.
If you own a brownstone in Park Slope, the estate attorney may already have a real estate broker available in that area that they have had a positive experience with to ensure the sale goes smoothly. If you are an avid art collector, a NYC probate lawyer usually has an expert appraiser on speed dial.
Naming a Co-Executor May Not be the Best Idea
Although with best intentions, naming two or more executors can sometimes create an ever present push and pull between the parties. When you give multiple people authority over the same decision making or allow them to oversee the settlement of the same transactions, it is common for disagreements to develop.
Having co-executors isn’t inherently good or bad, but be aware that it can encourage litigation. Executors who cannot agree tend to pursue court intervention. For example, to avoid the indication of favoritism, Alex names his four adult children as co-executors in his will. At his death, two of the children push to list the house up for sale, while the other two would rather live in the house rent-free. Since all four must sign the real estate broker agreement, the contract of sale with the prospective buyer, and the ultimate deed to transfer the property, the parties in favor of the sale cannot move forward without the cooperation of the other two. After several months of back and forth, the parties in favor of the sale file an action in court to compel the other executors to sell the property.
Prior to naming co-executors, speak with an estate attorney first to ensure that the collaboration would be successful. The entire purpose of having a will is to settle your estate and have your property transferred to the named beneficiaries without any delays or complications. It’s not uncommon for executors to put their personal interests ahead of the needs and interests of the beneficiaries. A co-executorship runs the risk of overcomplicating the settlement of the estate due to the nature of having various people working together with different philosophies and mentalities.
Contact a NYC Estate and Probate Lawyer
Choosing an executor is serious business. In the context of a formal consultation, we ask pointed questions to reasonably determine whether a co-executorship will flourish or falter. We may suggest implementing estate planning measures in order to achieve better results for the collaboration. The best way to make informed decisions regarding your estate is to acquire knowledge by ways of reading publications and consulting with an attorney experienced in probate matters. Should you require the assistance of an NYC Estate and Probate Lawyer, contact our law firm at (646) 233-0826. We welcome a sit down with you to discuss the concept of using a co-executor in greater depth.