The Executor Files: Secrets of Bad Executors Exposed

Klenk Law helps beneficiaries navigate probate issues and hold executors accountable when estates stall, information is withheld, or assets are mishandled. With decades of experience, we step in early to protect your interests, keep the process moving, and prevent small problems from turning into expensive disputes. 

Transcript

Hello. It’s Peter Klenk at Klenk Law, and I’m here again to talk to you about, oh, death and taxes — all these fun things. Today, it’s about bad executors.

So let’s look at our executor files, the things that I’ve seen over the last 30 years, and some of the sneaky things executors have tried — the secrets that executors have attempted that we’ve been able to expose. So let’s get to it.

First, let’s make sure you understand and that we’re on the same page about who is an executor. In every state in the U.S., we have a probate system — a system of making sure that the things that belong to the person who died go to the persons or entities they’re supposed to go to. That’s all probate is.

The person put in charge of that in most states is called the executor, the person who executes your plan. In some states, they call it a personal representative, but it’s the same job, so let’s stick with executor.

You pick a person in your will, in general, to be the executor, but it’s the king in the end — the government — that says who that person is. You file a petition. The county reviews the petition to make sure it’s the correct person, and then they give that person the paperwork saying that you are now the executor. Then they can carry out the plan, gather the assets, pay the bills, and, in the end, make sure the assets end up where they’re supposed to go.

Well, that’s how it’s supposed to work. And, you know, in most cases, that’s exactly what happens. Slowly, surely — maybe not in a linear fashion — but it gets where it’s supposed to.

But every once in a while, we get an executor who just does not do what they’re supposed to do. So what are some of these things? Let’s talk about them.

If you’re listening to this because you think, “Well, I think my executor is taking a little bit too long,” in general, a person isn’t expected to get things done as fast as possible. They’re just supposed to get it done within a reasonable amount of time.

Most executors are not professionals. They have to muddle through it. They might have to get advice. They have other jobs. So again, no judge is going to expect an executor to get things done as quickly as is amazingly possible — just within a reasonable amount of time.

So if you’re irritated that it’s taking a little bit of time, that in and of itself doesn’t make somebody a bad executor.

Maybe they’re not sharing information with you as much as you’d like. Well, again, the executor is supposed to share information with you, but they don’t have to tell you everything they’re doing every day as they’re doing it. There’s no requirement for that.

In general, we encourage the executors we advise to keep everybody informed because, in the end, you can go to a judge and say, “I don’t know what’s going on,” and then we have a hearing — and why do all that? Why not just keep everybody involved?

But again, if your concern is that the executor just isn’t getting back to you as quickly as they should, that alone isn’t necessarily a reason to go to court.

So what are some of the other things?

Well, things have to be sold. Is the executor not consulting with anybody — the beneficiaries — picking a price for a property that’s too low, picking a realtor who’s charging too many fees? Are those things you can complain about? Well, yeah.

Executors are supposed to do the best by everybody. That doesn’t mean they have to save you every penny and go out of their way to be irritating about it, but if they pick a realtor and could have picked one who charged a six percent fee and it ends up being eight, well, that’s a two percent difference they have to justify.

Do sometimes executors have buddies out there and get them a little kickback, or they’re trying to help out a nephew or niece or daughter or something? Well, yeah.

So you have to be careful as a beneficiary. Don’t be blind to what’s going on with the executor. Keep an eye on it, because those things can happen.

The worst-case scenario is they sell a property for less than what it should be to somebody who’s going to share the profit with them or a niece or nephew or something. That’s really bad.

It’s supposed to go for fair market value. That doesn’t mean it can’t be sold to somebody in the family, but it should be sold at fair market value. Keeping all the beneficiaries involved in that process is a way to avoid conflict.

If you’re being excluded, maybe you do want to get more involved or demand more data to make sure everything’s on the straight and narrow.

Another issue is the executor enjoying the assets. Is the executor supposed to be driving around the car? No. Are they supposed to be living in the house for free? Absolutely not.

If it’s a kid who was already there before, can they live there a couple months without paying because that was what was going on before? Sure. But eventually, you’re expected to pony up the money for living in a place you’re not supposed to have rent-free.

So if information is being withheld about who’s in the house and how much they’re paying, is that a concern? Well, yeah. You should ask about that. That’s information you’re entitled to have, and they should share it. If they’re not, that is a concern.

As far as the timeline, can an executor usually give you an exact timeline? No. Houses have to be sold. Tax returns have to be filed. Sometimes the tax man doesn’t get back for three or four months. There are things they just don’t have control over.

But after a year, most things should be done, or there should be a schedule. So once you get toward the end of a year, is it reasonable to ask, “What do you think the end date is?” You can’t hold them to an exact day, but you should know what’s going on.

A bad executor has no timeline. They’re not really getting things done. They have no agenda. And an estate can go on for years. There’s no law saying an estate has to be finished. If nobody files a complaint with a judge saying, “Hey, what’s going on? Speed this up,” the system assumes you’re all happy.

That’s a concern. If, at the end of the year, there’s not at least a pretty good outline of what’s going on, you might want us to get involved before it keeps dragging and dragging and dragging — because it just gets worse.

Then there’s the division of assets and scheduled distribution. I can tell you how many fights I’ve overseen over the years over jewelry, dishes, and whatnot. Things that are important — sometimes more important than the money.

There should be a plan early on. What’s the plan? If the executor is vague, unfortunately there are executors who let certain people go first and pick and choose, and now you’re left out in the cold.

Are you really going to hire us to fight over grandpa’s desk worth a couple hundred bucks? No. You’re just going to be angry. So if the executor can’t explain how personal property is going to be divided, that may be a reason to get us involved earlier.

Sometimes just firing a shot over the bow — letting the executor know someone’s watching — keeps them from forming bad habits.

Executors are also entitled to fees. That’s the statute. Sometimes documents specify a fee or no fee, which is fine. Otherwise, executors can take a reasonable fee for their work.

There’s nothing wrong with asking upfront, “What are you thinking?” because if you’re unhappy with the answer, it’s better to address it before all the work is done.

Sometimes estates become more complicated — termites, a tanking economy, unexpected work. That doesn’t mean you can’t talk about the plan upfront so you’re not surprised at the end.

Every estate is different. Businesses, farms, pets, gold — it all depends. What it really comes down to is communication.

Executors don’t have to tell you everything they’re doing, but they should keep you reasonably informed. If you feel like you’re not getting what you need, that’s why you hire us.

Often, just hiring us early keeps the process smooth. It removes temptation to drag heels or do something sneaky, because they know you’ll find out. And if they are doing something illegal or improper, it allows us to get into court before the damage is done.

So there you go — some examples and ideas. Your situation will be unique, and we’d be happy to talk to you about it.

Give us a ring at 215-790-1095. That’s our general number for all offices. We’ll set you up with the best fit for your situation, and we’d be happy to help.

Take care. It’s Peter Klenk. Like and subscribe, please, so as new information comes out, you can listen to my soothing voice talk about all these fun subjects.

Have a great day.