We often hear that people contest estate executors in court because they failed to fulfill their fiduciary duties. If you are new to estate law and are not at all familiar with the term “fiduciary,” it is important to understand the basics so, in the future, if you should have to deal with a New York estate executor, you will possess a good understanding of how the executor should fulfill his or her task.
The Legal Dictionary describes the concept of a fiduciary. First, the term “fiduciary” can refer specifically to a person, to someone who is entrusted to manage the property or assets of another person. In the case of estate law, a fiduciary is one who manages the estate on behalf of another. When the person who owns the estate passes away, the fiduciary must carry out the wishes of the deceased, however those wishes are expressed.
The term fiduciary can also describe the relationship by which a person is obligated to act for the benefit of others. In the legal arena, the relationship between a client and an attorney is considered a fiduciary one. Other fiduciary relationships include those between a trustee and a beneficiary, a principal and an agent, and a broker and a principal. In the case of estate law, it also refers to the relationship between an executor or an administrator of an estate and the heirs of the person to whom the estate belongs.
The nature of a fiduciary relationship in administering an estate is that the heirs to the estate are putting trust in the administrator that the wishes of the deceased are being faithfully carried out. A faithful executor will take reasonable care of the assets within his or her care until such time as the assets and property are to be dispersed to the beneficiaries. The executor must also show loyalty to the wishes of the estate and not unjustly or unscrupulously take advantage of the position of executor.
Problems arise when an executor, who retains great authority in a fiduciary relationship, acts in a manner that abuses his or her authority. This can include the executor siphoning off assets or damaging property that belongs to the estate. Courts will scrutinize such actions and if necessary, take action against an executor who has acted against the fiduciary interests of the estate, and if necessary, remove the executor from the position.
This article is intended to inform readers on fiduciary relationships and should not be taken as legal advice.