Administering an estate can be a complicated business at the best of times. With more people owning multiple properties than ever before, more people owning businesses, the upcoming and drastic changes to UK tax rules and an increasingly diverse range of financial assets which has never been more accessible to consumer investors, it is likely only going to become more complicated.
When there are also disagreements between the estates personal representatives or the beneficiaries, administering an estate can quickly become a nightmare.
What is an independent administrator?
An independent administrator is a person approved and appointed by the court to administer an estate. If the deceased left a will, the independent administrator will replace the executors named in the will but if the deceased did not leave a will, the independent administrator will replace the individuals entitled to the estate under the Intestacy Rules.
To ensure they are truly independent, an independent administrator cannot be connected to the estate and cannot have any financial interest in any of the assets which form part of it.
The court will almost always expect an independent administrator to be an experienced probate practitioner and will often look to appoint the partners of a law firm.
When is an independent administrator required?
There are many circumstances in which the appointment of an independent administrator would be beneficial to an estate.
An executor named in a will may be untraceable, or unable to act because of bankruptcy or poor health, leaving the beneficiaries to become ever more frustrated at a lack of progress.
Often, however, an independent administrator is appointed because of some disagreement or conflict of interest between an estate’s personal representatives and/or the beneficiaries.
The executors of an estate may not trust one another or find themselves unable to agree on how to deal with an estate, meaning key decisions cannot be made and the estate’s administration inevitably stalling. Alternatively, the beneficiaries may consider an executor to be unfit or an inappropriate person to act in such an important role.
What are the benefits of an independent administrator?
Fundamentally, the role of an independent administrator is to identify, collect and protect an estate’s assets for the benefit of the beneficiaries whilst any claims or disputes are resolved. After the resolution of all disagreements, the independent administrator will distribute the estate in accordance with the terms of settlement.
In fulfilling their role, an independent administrator must carry out all of the duties associated with administering an estate, which would otherwise be carried out by the executors named in a Will or the administrators entitled under the Intestacy Rules. Importantly, they must also remain completely independent and impartial throughout their management of an estate.
As independent administrators are invariably highly experienced professionals, their appointment ensures that an estate will be administered expertly and efficiently. A conflicted, incompetent or absent personal representative who is unable or unwilling to progress an estate’s administration can result in significant financial losses to an estate. An independent administrator will ensure that this does not happen and that the estate is preserved for the good of the beneficiaries.
How is an independent administrator appointed?
The appointment of an independent administrator will always require an application to the court. The nature of the application will depend on the current stage of an estate’s administration, and to what extent the personal representatives and/or the beneficiaries can agree on what is in the estate’s best interests.
To minimise the potential losses associated with poor management of an estate, it is better for an independent administrator to be appointed at as early a stage as possible, but this is not always realistic and a court application can be made at any time.
Not only is a lack of progress hugely frustrating to the beneficiaries of an estate, but it can also result in financial losses and a smaller inheritance. The appointment of an independent administrator is a complex matter, but will ensure that progress continues and an estate’s value is preserved whilst any disagreements are resolved.
If you have any questions about independent administration, please contact our expert team firstname.lastname@example.org.