A Will is arguably one of the most important documents that you will prepare in your lifetime. It sets out what you want done with your ‘things’ once you’ve passed on. A key aspect of your Will is who will organise and distribute your estate (i.e. acting as the executor of your estate). You want your executor to be capable of administering your estate without placing too much burden on them at a time of grief. It is for these reasons that you may consider appointing a lawyer to act as your executor. It is also an option to appoint a state or territory public trustee to act as an executor. However, there are some arguments against doing this.
Appointing a State Trustee or Public Trustee
Because the public trustee is a public service, there can be delays. There will likely be a number of staff working on the one estate matter, which means that for each interaction, your beneficiaries may be talking to a different staff member. This is in comparison to when a competent family member or a lawyer is appointed as an executor.
Public trustees tend to take a 100% control approach. On the flipside, a lawyer may be more accountable to the estate and beneficiaries as they have a business with a reputation that needs to remain intact.
State and Public Trustees in Australia
As each public trustee office is run by their state or territory government, their practices may alter depending on the status of that government. The below list provides the different name variations for the public trustee offices across the states and territories:
- ACT: Public Trustee and Guardian
- NSW: The NSW Trustee and Guardian
- NT: The Public Trustee
- QLD: The Public Trustee
- SA: Public Trustee
- TAS: The Public Trustee
- VIC: State Trustees
- WA: Public Trustee
State Trustee and Public Trustee Commissions and Fees
Public trustees tend to charge by a commission or an hourly rate, which can result in expensive fees being paid from the estate.
As a hypothetical calculation for the Queensland public trustee that charges at an hourly rate, if The Public Trustee spends 8 hours per week on the administration of the estate over a period of 6 months (26 weeks), then that comes to 208 hours, which could come to a final fee of $47,496.80 (incl. GST).
The total fee for commission based fees (that are applied generally across the other states/territories), will depend on the value of the estate, however, using an estate value of $500,000 the commission could come to $22,000 plus the additional fees.
‘Free’ isn’t really free
As is evident, appointing the public trustee as executor of your estate could end up being a costly endeavour. There are some State Trustees and Public Trustees that offer free Will drafting if you appoint them as executor. However, the savings made from having your ‘free’ Will drafted may be a drop in the ocean compared to the above commission/fees charged by a public trustee as your executor.
Who you appoint as executor of a Will is an important decision that you need to make when preparing your Will. It is essential that you take all matters into consideration before appointing your executor.