Estate Administration is a foreign concept to a lot of people, and it’s not until you’re thrown into the job that you realise you’re not entirely sure what you should be doing. At Gallie Miles, we are often posed with the same initial questions, and thought it would be useful to address these for executors to refer back to.
1. Someone has just died, and I am an Executor in their Will, what do I need to do?
If you have been appointed as an executor in someone’s Will, don’t panic. There is nothing urgent you need to attend to, but it is always a good idea to notify the deceased’s lawyer, so they can begin to do some initial background work. It’s also a good idea to notify the bank of the deceased and Work and Income NZ if the deceased was receiving superannuation payments at the time of their death.
2. Who is responsible for paying the funeral invoice and how does it get paid?
The funeral invoice is a cost that is payable by the estate. Once the bank has been advised that the deceased has passed away, they will freeze all the deceased’s bank accounts however, they will still allow for the funeral invoice to be paid direct from the deceased’s account. If the estate does not have enough funds available to pay the funeral costs, then the responsibility falls onto the executors and the person that signed off the funeral arrangements with the undertaker. Some estates may qualify for funeral payment assistance such as a WINZ contribution or an ACC contribution.
3. We need to continue covering payments such as power and insurance, what do we do?
Most providers are incredibly understanding, and you can request they place a suppression on the accounts until access to estate funds becomes available. This means they will continue to invoice the estate but should waive any interest or late payment fees. Alternatively, the executors can continue to cover these payments from their own pocket, and they will be reimbursed at a time that the Estate funds become accessible. Mortgage repayments and insurance payments unfortunately cannot be halted, and these are costs that will need to continue to be met after death.
4. The deceased had a property, can we sell it straight away?
You can place the property on the market any time you like, however, we ask that you do not sign any Sale and Purchase Agreement until the estate’s solicitor has checked over it as your solicitor will need to include additional clauses that act as a lawyer of protection against the executors of the estate. Any agreement would be condition upon the grant of Probate.
5. How long until we can have the money in the Estate?
Each estate is different, and it depends on the assets held in the estate. Applications for Probate and Letters of Administration are currently taking around 12 weeks to be granted. There are also timeframes that the executors are encouraged to wait before they distribute any funds from the estate being 6-12 months from the date Probate has been granted. It is hard to gauge timeframes when you are dealing with external sources such as the bank and IRD. As a general rule of thumb, we advise people not to expect any funds be distributed until at least six months after Probate has been granted.
6. What do I need to do if I am an Executor named in the Will?
Your role as executor is to follow the instructions in the Will. The estate’s solicitor should guide you through the entire process, and they quite often do the bulk of the work on your behalf, however your main role is to ensure that all assets have been captured, all debts have been repaid, and any balance is distributed in accordance with the Will. If you are an executor that is also a beneficiary, and you have any concerns with the way the estate is being administered or the distribution of assets, you should seek independent legal advice in your capacity as a beneficiary.
7. Everything is jointly owned, do I still need Probate?
No, you do not need a grant of Probate for jointly owned assets as they transfer to the surviving owner on death however, we suggest you call your solicitor to ensure the transfer to the survivor is done correctly.
There are things that you can do to alleviate the pressure on your executors after you pass away and other ways that you can organise your affairs to prepare for death. If you would like some advice around a succession plan, please contact one of our asset protection and estate planning specialists today.