Good Rules for an Executor of Estate and Will
Many times when a person is nominated as an executor of an estate in a will, he or she does not know of the potential for mishaps. Errors of executors of estate range from errors in judgment, namely negligence, to intentional acts which may damage the value of the estate and ultimately what the heirs would potentially inherit.
What is considered an error by an executor?
In summary, anytime an executor’s action leads to a loss in the estate, his action may be deemed an error. In California, when an executor of a probate estate is not sure about his duty, he may petition the court for instruction to avoid such mishaps.
Losses can occur in an estate as follows:
- Mixing up the assets of the estate with your personal assets.
- Staying in the property rent-free.
- Letting someone else stay in the property rent-free.
- Not investing estate assets in interest-bearing accounts.
- Taking on risky investments in the estate.
- Personally profit from an asset of the estate, or a transaction of the estate.
- Having a side deal with an agent to receive a kick back.
- Failing to inventory all assets of the estate.
- Failing to adequately bond the estate, when there is no bond waiver.
- Failing to put an asset in blocked accounts when the probate court requires it.
- Not keeping records of the assets and expenses of the estate, or failing to keep the records in a way that can substantiate an accounting.
PETITION FOR INSTRUCTIONS IN PROBATE
When there are questions about duties of the executor of a will, the executor may submit a petition for instructions to the court asking the court to decide on the action before the executor makes a decision. This prevents losses and later litigation over the action by the executor of the estate. a Petition for Instructions is a fairly easy fix for many issues that arise from actions of executors.
If you are named as an executor of a will or estate, you should be careful not to make the above mistakes. If you are unsure about an action, it is very simple to ask the court to instruct you.