Probate litigation in East Brunswick, like anywhere else, is something most families would rather avoid if possible. That's why an estate executor should be careful that he or she knows what his or her fiduciary duty is toward the estate's assets. Some mistakes can be costly both for the executor and the heirs. Probate litigation can go on for months or even years in some cases.
What exactly is the fiduciary duty of an estate executor? Simply put, it is to distribute the assets of the deceased in the manner he or she instructed and to ensure that all debts and creditors of the deceased are paid. Seems simple enough, but there are some common mistakes that executors often make that can end in probate litigation, or worse, render them personally responsible for the cost of the error.
One such mistake is rushing to pay the deceased person's bills before assessing all debts owed. Priorities of debts, as well as priority of disbursement of assets, should be carefully calculated before anything is paid or disbursed. It is easier to make adjustments before the assets or funds are gone than after. When it comes to debts, federal or state tax liabilities are usually the first and most important to be paid.
Asset division between heirs should also be assessed along with debts. Some assets may need to be sold to pay debts instead of being parsed between relatives or heirs. In cases where assets are improperly disbursed, an executor could be held personally responsible and even sued.
Another mistake that could render an executor in hot water is an attempt to increase an asset by investing it without a requirement to do so. Losing or lessening the value of an asset can also be considered a breach of one's fiduciary duty.
If you are privileged to be an executor of an estate, do your research and know exactly what your legal obligation is in each clause of the will or trust. If you are not sure, an attorney can help you with more information and advice.
Source: MarketWatch, "The biggest mistakes executors make," Veronica Dagher, accessed Nov. 10, 2017