GARY died leaving his estate to his four children.

He appointed his best mate, Nigel, as the executor of his will.

Gary’s children anticipated the value of the estate, including his house, was valued at around $2 million.

However, Nigel’s handling of the estate led to significant frustration and suspicion among the beneficiaries.

Nigel, who has a mate in the real estate business, obtained an appraisal of Gary’s house.

He then proceeded to sell the house to his son-in-law, for the value set-out in the appraisal.

The sale raised eyebrows among the beneficiaries, who felt that the appraisal might not have been objectively and independently prepared, potentially leading to an undervaluation of the property.

When the time came for the distribution of the estate, Gary’s four children were dismayed by the reduced size of the estate and the ambiguity surrounding the asset sales.

They were also concerned about the lack of any apparent sale of the household contents, which they suspected were taken by Nigel without proper accounting.

The beneficiaries decided to take legal action.

Nigel’s actions, if proven to be negligent or self-serving, could potentially constitute a breach of fiduciary duty, and he may then be held liable for the financial loss suffered by the beneficiaries.

The Court emphasised the need for transparency and diligence in estate administration and ultimately found that Nigel had breached his duties and was liable for the loss suffered by the beneficiaries.

This case highlights the critical importance of executors fulfilling their fiduciary duties with transparency and fairness and ensuring beneficiaries’ interests are protected.

It serves as a stark reminder that executors are best advised to obtain independent valuations regarding sales of real estate and other substantial estate when they are not realised at “arm’s length” and to avoid conflicts of interest to maintain the integrity of the estate administration process.

Thank you to Anthony Fogarty for his assistance with this column.

Email Manny Wood, principal solicitor at TB Law at manny@tblaw.net.au or call him on (02) 66 487 487.

This column is only accurate at today’s date and cannot be relied upon as legal advice.

By Manny WOOD, Solicitor