Choosing someone to handle your estate once you’re incapacitated or gone is a difficult task, to be sure. You’ll want someone capable of stepping in to make decisions on your behalf, according to your wishes.
But, what exactly do fiduciary duties entail? And how can your loved ones hold an executor accountable if they suspect a conflict of interest is involved?
Four factors in a breach of fiduciary duties
For example’s sake, let’s say your aunt Catherine designated you as the executor of her estate. Upon acceptance, your responsibilities take effect.
You familiarize yourself with Catherine’s financial accounts, pay her bills and distribute assets as requested. You keep her funds separate from yours, organize her records and work with your attorney to ensure you’re acting in your aunt’s best interests.
Your cousins have the right to disagree with what they receive and the amount of power bestowed upon them. However, should they fear a breach of fiduciary duty, they would have to prove:
- You agreed to conduct Catherine’s affairs legally and ethically
- You failed to act accordingly
- Your execution caused harm
- The damage was intentional
Assuming Aunt Catherine had a current will, you could refer to her directives to defend yourself in court. Like any allegations of mishandling your fiduciary duties, your cousins would need legal grounds to contest her will.
Isn’t this avoidable?
Developing an estate plan is an essential part of minimizing contention between family members during their grief. Having things in writing, though, is just the first step you should take toward designating assets to your beneficiaries.
Keep your estate plan current, and communicate and share your wishes with your loved ones, to reduce the chances of competition, jealousy and anger after you’re gone. Although your family might disagree with your choices, they should respect them and the legal rights with which you set your wishes in place.