When a Personal Representative Breaches Their Duty

June 23rd, 2017
Personal Representative Duties: Hand Writing

Serving as the personal representative (also called the executor or administrator) of an estate is a great responsibility. You're responsible for identifying, inventorying, securing, and distributing a deceased person's assets, not to mention paying their creditors and the estate's income taxes. For someone who's never served in this capacity before, the responsibility can be overwhelming, especially if the estate contains complex assets like a business or rental property out of state. It can be easy to make a mistake, which is why Ohio law authorizes a personal representative to hire a probate attorney to assist in the administration, and for the attorney's fees to be paid out of estate funds, not the personal representative's pocket.

Most personal representatives take their position very seriously and strive to do a good and efficient job. On occasion, however, a personal representative may act carelessly or even unethically, breaching the duty they've undertaken to faithfully execute. What recourse do heirs and creditors have when a personal representative breaches their duty?

What Is a Breach of the Personal Representative's Duty?

A personal representative is a fiduciary: they stand in a position of trust, ethically and legally, to the estate and its heirs. This fiduciary duty means that the personal representative is bound to act in the best interests of the estate, even if those run counter to the personal representative's own interests. Common breaches of the personal representative's duty include:

  • Using estate funds for the personal representative's own benefit
  • Committing fraud by concealing assets or some other act or omission
  • Misappropriation of assets
  • Negligent or reckless management of estate assets
  • Failing to properly account for estate assets (typically gross negligence, not minor errors)
  • Not following the deceased's explicit direction in the will or a trust
  • Failing to file and pay estate income taxes
  • Failing to properly notify heirs or creditors
  • Failing to pay legitimate claims against the estate
  • Mishandling of or failure to invest unclaimed estate funds
  • Giving improper preference to one beneficiary or class of beneficiaries over another
  • Unnecessarily delaying distribution to heirs or conclusion of the estate's administration

Some of these breaches may be accidental, but some are the result of intentional wrongdoing. Unsurprisingly, Ohio law provides for action against a personal representative who breaches their duty to the estate.

Consequences for an Ohio Personal Representative's Breach of Duty

If an executor breaches their fiduciary duty, there are a number of consequences. They may be removed from their position by the probate court. If the estate includes personal property that is required to be sold, and the personal representative fails to do so, there may be a steep financial penalty. If the personal representative keeps, consumes, or disposes of the asset, he or she may be held liable for double the appraised value of that personal property. Heirs or beneficiaries may also file a civil suit against an executor for breach of duty.

In addition to financial consequences, there are interpersonal consequences for a personal representative's breach of duty, as well. If, as is typical, the personal representative is a family member of the deceased and heirs, a breach of duty could lead to irreparably broken family relationships.

The consequences for mishandling of estate assets or other breach of duty is one of the most important reasons personal representatives should have the assistance of a qualified Ohio probate attorney. An experienced attorney will help the personal representative avoid an unintentional breach of duty as well as safeguard against intentional breaches.

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Categories: Executors / Personal Representatives