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Writing a Will? Here’s how you should choose the executor

The executor's key responsibility is to gather details of all the assets that are mentioned in the estate, protect these assets and distribute them to beneficiaries as per the instructions in the Will

January 21, 2022 / 09:43 AM IST

For those who want to distribute their wealth amongst their children, spouse or other legal heirs after their death, a Will is a highly useful instrument.

Through a Will, the testator – that is, the person preparing the Will – can eliminate, or at least minimise the chances of disputes amongst legal heirs after her demise. However, making a Will is one part of your responsibility. To ensure that your instructions in the Will are carried out, it is equally important to appoint the right executor.

Who can be an executor?

An executor is a person who is appointed by the testator to implement her last Will. The appointed executor’s details are mentioned in the Will and derives his authority from the instrument. “After the demise of a testator, the executor has to step into his shoes and ensure that the Will is executed as per his last wishes,” says Sreepriya NS, Director and COO of Entrust Family Office.

As per law, the executor should be over 18 years and of sound mind. She should be young enough to outlive the testator. You must choose an executor based on two factors, i.e. trust and knowledge to perform the necessary duties. She should have an understanding and the capability to manage legal matters, accounting processes, administrative work etc. “In case the appointed executor lacks these skills, the entire process of execution of the estate can get delayed,” says Shailendra Dubey, Partner, PlanMyEstate Advisors LLP.

You can appoint a beneficiary, friend or a relative as an executor or entrust the responsibility to a professional lawyer, chartered accountant or financial advisor to execute the Will. “You can appoint one or more executors in your Will, but clarify who will have the ultimate decision power,” says Dubey. You can also appoint substitute executors as well, in case appointed executor is unable or unwilling to act after the demise of the testator.

“Although not mandatory, but to be done where possible, preference in choosing an executor should be for a trustworthy professional organisation (with good financial and/or legal background) that is able to dedicate a significant amount of time, as the distribution process of the whole estate to beneficiaries can typically take six to 12 months,” says Atulya Sharma, Partner at Lumiere Law Partners. He adds that the executor should be resident in India, as the process of executing a will in India is cumbersome and will require performance of several duties/actions at regular intervals.

Also read: Want to pass on values in addition to wealth? Write an ethical Will

Key responsibilities

The executor's key responsibility is to gather details of all the assets which are mentioned in the estate, protect these assets and distribute them to beneficiaries as per the instructions in the Will. “The executors’ role is to first gather all these details in the physical or in the electronic form. Then, they should reach out to all the beneficiaries mentioned in the Will and any other potential heirs for distribution of the investments,” says Sreepriya. The executor can also liquidate the investments for distribution, if required by the Will, or transfer them to beneficiaries. “An executor also needs to settle the outstanding loans of the testator. It is his responsibility to make sure that the debts are repaid out of the estate,” says Sreepriya. Filing the income tax of the deceased person is also the executor’s duty if mentioned in the Will.

An executor must exercise great caution while implementing the instructions in the Will. Experts say there have been instances when the executors have been held liable for mistakes and oversight while executing the Will, even if those mistakes were made accidentally. So, ensure that the distribution of the assets is done accurately, as per the Will.

In case any dispute arises between the beneficiaries and legal heirs at the time of execution of the Will of the testator, then the executor of the Will plays an important role. “Executor may act as a mediator between the family members of the deceased testator and ensures a peaceful and proper disposition of the estate,” says Priyesh Sampat, Head Strategic Solutions, Sampat Investments.

Challenges in the absence of an Executor

In the absence of an executor, a Will is open to challenge. Each legal heir claiming any interest or share in the estate of the deceased testator will have to prove their claim and apply for letters of administration or succession certificates. There are bound to be disputes or delays, which may affect the distribution of the estate of the testator. The process of succession, inheritance of the assets and settlement of debts and liabilities of the testator will also be affected.

Then, there could be instances when the executors decline to perform their obligations or are unable to do so for some reason and no other person is willing or able to act as an executor. In such cases, the courts may appoint an administrator to oversee the disposal of the estate (assets) of the deceased testator. “The beneficiaries can appoint a neutral firm or appoint one amongst them to execute the Will as per the wishes of the testator,” says Sampat.

Also read: Follow these 7 steps to transfer assets smoothly to heirs after your time

Individual Vs professional executor?

If you appoint an individual as an executor, the fee cost won’t be high, as friends or relatives close to the testator are unlikely to charge a fee for their services. There will only be actual expenses reimbursed for legal matters and administrative costs. “In appointing individual executors, there may be a risk of personal biases. Professional organisations as executor are more likely to be neutral while distributing the assets,” says Sharma.

In families where the estate is large, the testators prefer appointing a professional firm which include lawyers, chartered accountants etc. However, appointing professional executors comes at a cost. “Most of the mid-size law firms charge between Rs 3 lakh and Rs 5 lakh and large law firms charge between Rs 15 and Rs 20 lakh, it varies with the complexity and scope of work,” says Dubey. Some professionals charge 0.5 percent to 2 percent of the estate value as their executor fees.
Hiral Thanawala is a personal finance journalist with 9 years of reporting experience. Based in Mumbai, he covers financial planning, banking and fintech segments from personal finance team for Moneycontrol.
first published: Jan 21, 2022 09:43 am