When appointed as an executor of an estate, you must understand the role’s duties and obligations so that you correctly manage the decedent’s assets. As an executor, you must follow the deceased person’s wishes, but in some cases, the beneficiaries may disagree with your choices.
In times of disagreements, beneficiaries can file litigation against you.
Potential risks and liability
As the executor of the estate, you have control over how to pay off the decedent’s debts and distribute the assets according to the will or other estate planning documents. Even if you act in good faith, beneficiaries may accuse you of mismanaging the assets, failing to pay debts or having a conflict of interest.
Potential risk mitigation
To mitigate the risk of facing lawsuits as an executor, you must minimize the risk appropriately. First, exercise diligence and care when managing the estate’s assets. You should keep accurate records of every financial transaction and decision made on behalf of the estate. Likewise, you should communicate all of your choices as transparently as possible. Keep the family and friends informed throughout the process to establish trust.
Always adhere to all legal requirements and the probate process’s deadlines. Failure to comply with statutory obligations can result in legal repercussions and potential liability.
If you do face a lawsuit, respond to it quickly and appropriately. Cooperating fully with the legal process can help you to overcome the allegations. If you try to ignore the litigation or work it out privately, the plaintiffs can use it against you.