When a person passes away, their assets are usually distributed according to their Will. The individual responsible for managing and distributing these assets is the “executor” of the deceased estate. In many cases, a Will appoints more than one person to act as co-executors. These individuals normally need to work cooperatively to execute the duties of the role under the Probate and Administration Act 1898 (NSW).
As with any complex and emotional task, managing a deceased estate can give rise to conflict and disagreements. This risk increases when executors are also beneficiaries of the estate, as their administrative decisions directly impact their own inheritance under the Will.
This guide provides general legal context only. You should always consult a qualified estate litigation lawyer regarding your specific estate dispute.
Common Causes of Disputes Between Executors
Disputes between co-executors can arise for many reasons, including simple personality clashes. However, specific scenarios occur regularly during estate administration.
Disputes Over the Meaning or Validity of the Will
Disagreements often emerge if co-executors disagree on how to interpret the terms of the Will, or if one party questions its legal validity. Common issues include:
- Ambiguous or unclear language in the Will leading co-executors to form contrasting views about the deceased person’s true intentions.
- Allegations by one executor that the Will is invalid due to lack of testamentary capacity or undue influence, prompting a formal court challenge while the other executor seeks to uphold the document.
- Failure of a Will to specify exact asset allocation details, leaving co-executors at odds over how to divide physical items or real estate.
Disagreements Over Managing Estate Assets and Liabilities
In addition, executors often clash over day-to-day administrative tasks before obtaining a Grant of Probate from the Supreme Court of New South Wales. Typical friction points include:
- Deciding whether to sell real estate and shares quickly to generate cash, or hold assets in expectation of market gains.
- Determining which outstanding debts, tax liabilities, or creditor claims require immediate settlement before distributing funds to beneficiaries.
- Diverging views on whether to engage professional advisors (such as solicitors, accountants, or real estate agents), where one executor resists incurring administrative costs against the estate.
Disagreements Over Asset Valuations and Distributions
Finally, co-executors may disagree during the final distribution phase. Conflicts frequently happen when:
- Executors place different values on specific assets, such as real estate, collectibles, or family heirlooms.
- One executor wants to transfer a specific asset directly to a particular beneficiary, while the co-executor insists on selling the item and distributing the cash proceeds.
How Executors Can Prevent Disputes
Avoiding an estate dispute early is far better than attempting to resolve an entrenched legal battle later. Co-executors can take several proactive steps to prevent conflict.
Act Impartially and Neutralise Conflicts of Interest
As an executor, you hold a strict fiduciary duty to act impartially and in the best interests of the estate. You must avoid conflicts of interest and make decisions that treat all beneficiaries fairly. Acting with complete neutrality helps build trust with co-executors and reduces grounds for suspicion.
Maintain Clear and Transparent Communication
Misunderstandings often develop when co-executors maintain different expectations regarding communication. Ineffective communication (such as one executor making executive decisions without consulting the other or withholding updates) invariably creates conflict. Sharing information promptly keeps administrative decisions transparent.
Keep Comprehensive and Accurate Records
Detailed record-keeping prevents financial misunderstandings and protects co-executors from claims of asset mismanagement. You should record all communications, written decisions, receipts, and bank transactions, ensuring all co-executors access these records regularly. Maintaining clear books keeps everyone aligned and resolves factual doubts quickly.
Options for Resolving an Executor Dispute
When an active dispute stalls estate administration, continuing the process becomes stressful for everyone involved. Fortunately, structured options exist to resolve deadlock and move the administration forward.
| Dispute Resolution Option | Primary Benefit | Best Suited For |
|---|---|---|
| Independent Legal Advice | Clarifies rights, fiduciary duties, and court interpretation. | Early-stage disagreements or legal ambiguity in the Will. |
| Professional Mediation | Confidential, cost-effective, and avoids litigation expenses. | Co-executors who are willing to negotiate a fair compromise. |
| Supreme Court Application | Provides binding judicial orders or revokes Probate. | Severe uncooperative behavior, breach of duty, or deadlock. |
Identify the Root Cause of the Disagreement
The first step in resolving a co-executor dispute is pinpointing the underlying cause of the deadlock. Understanding whether the issue stems from legal uncertainty, financial distrust, or personal friction allows you to choose an appropriate remedy.
Seek Independent Legal Advice
Consulting an experienced probate solicitor provides clarity regarding your legal rights and duties. In many instances, deadlocked co-executors willingly accept guidance from a neutral legal specialist who can clarify how the Supreme Court of NSW would interpret the issue.
Engage in Professional Estate Mediation
Mediation offers a confidential and structured alternative to court proceedings. During mediation, an independent third-party mediator helps both sides negotiate a practical compromise. This approach is less confrontational and far more cost-effective than litigation, protecting estate assets from being consumed by legal fees.
Applying to Remove an Executor
If an uncooperative executor causes severe unreasonable delays, mismanages assets, or refuses to fulfil their legal duties, you may need to seek their removal. Under section 66 of the Probate and Administration Act 1898 (NSW) or through section 75A delegation to the NSW Trustee and Guardian, the Supreme Court can revoke a Grant of Probate and appoint a replacement administrator. However, court-ordered removal remains a last resort due to potential litigation costs.
Resolving Disputes Between Executors in NSW: Next Steps
Managing a deceased estate involves complex administrative duties that easily trigger personal disagreements. Seeking prompt legal guidance helps you understand your responsibilities as an executor, resolve deadlocks efficiently, or obtain court orders when necessary.
If you need assistance resolving an executor dispute or managing estate administration in NSW, please contact our legal team on 02 9792 8413 or email [email protected].