QLD Executor Spent Deceased's Money Before She Had Passed

[Tamara]

Hi there,
My mother was terminally ill a few months back. She had appointed a friend of hers as power of attorney to help plan any of her funeral services with the help of us (her children). This friend was also appointed joint executor, with one of my aunties, of the will to which everything was left equally to us 3 children. When mum was coherent, she had taken out her superannuation money and had it in an account which this 'friend' had access to. We have since found out that this 'friend' executor had helped herself to some of mum's money while mum was still alive, we have no receipts nor have we been shown what the money was spent on. This executor has hired a n estate planning lawyer to do the probate and I have asked the lawyer if he can help me to find out how much super mum had withdrawn to see how much the friend had helped herself to but the lawyer has said he works for the 'friend' executor so I would need to get my own lawyer if we wanted this info.

Is there anyway of finding out how much superannuation mum had prior to this lady taking some?
Us kids just want this friend to be held accountable for her actions. This was not her money to help herself to. Nor had/has she included the other joint executor of a will into any of the spendings which I would have thought was also illegal.

Just want to know what options we have, and if its worth fighting?

 

[Paul Cott]

Tamara,

I would think that inquiries of the super fund could be made and maybe a statement provided which shows what has gone in and out of the fund. Your auntie, the other executor should be able to make those inquiries.

Then you should know what you are dealing with as far the super fund monies are concerned. Hope that helps.

 

[Sarah J]

Hi Tamara,

1. As Paul suggested, call up the super fund and enquire. Your aunt, as co-executor, is recognised at law to handle your mother's affairs so she will be most entitled to do this. However, you may try contacting the fund yourself as well.

2. Did your mum put this super money into a trust account held by this "friend" executor in favour of you and your siblings as beneficiaries? This super money may not actually form part of the estate. Further, did the "friend" executor apply this money toward reimbursement of costs and expenses in exercising her duties as power of attorney or later as executor? You need to find out whether the "friend" executor really did in fact misapply the trust money.

3. If the "friend" executor really did misuse the money, your aunt as co-executor can sue the "friend" on behalf of the estate. If you are one of the intended beneficiaries of this money, either by an express trust created by your mother or as a beneficiary of the estate to which the money forms, they you may sue the "friend" as a beneficiary for breach of fiduciary duty.

 

[Tamara]

Thanks Sarah J. I will give the super fund a call, and just check the funds. Yes these funds form part of mums estate. They were withdrawn and put into mums personal account to which this friend had access to, and was transferring out of mums account and into her own. That was until mums cell phone was cut off and the 'friend' no longer had access to the pin codes to verify transfers were no longer able to be received.
We are aware of at least $5k that was taken by the 'friend' for 'living expenses' while mum was staying with this friend and also tried to pay for other friends flights and accommodation to attend mums funeral which we said was not ok with us (as beneficiaries).

If we try to sue the 'friend' what are the chances we will win, will it be worth it in terms of extra money we will need to spend to go through with it?

 

[Sarah J]

Hi Tamara,

If you are clear that these funds form part of the estate, you're aunt, as co-executor is able to sue on behalf of the estate and you are able to sue as a beneficiary on the ground that the friend executor did not act in the best interests of the beneficiaries, misapplied funds, mismanaged the estate and ultimately, is in breach of his/her fiduciary duties.

 

[Sarah J]

Whether it is worth suing or not is a difficult question to answer. It will depend on a number of factors, including:

- How much the fund was worth and how much this friend executor misappropriated
- The legal status of the fund (i.e. if it is in fact part of the estate or in trust for some purpose)
- What the friend executor did with this money and whether he/she can argue it was for a proper purpose
- His/her actions in executing and administering the estate, in all circumstances

It might be best to approach a lawyer about this matter. I would recommend contacting a local community legal centre to enquire.

 

[Tamara]

Whether it is worth suing or not is a difficult question to answer. It will depend on a number of factors, including:

- How much the fund was worth and how much this friend executor misappropriated
- The legal status of the fund (i.e. if it is in fact part of the estate or in trust for some purpose)
- What the friend executor did with this money and whether he/she can argue it was for a proper purpose
- His/her actions in executing and administering the estate, in all circumstances

It might be best to approach a lawyer about this matter. I would recommend contacting a local community legal centre to enquire.

Hey Sarah J.
Ok i have a bit more info. The statement of assets and liabilities from the probate lawyer had the super listed. The total sum including jewellery and car is $60k. It also lists that there are zero debts/liabilities.
The friend had now sent her own updated (excel spreadsheet) listing the money she had spent. This money was spent without the joint approval of the co-executor, and was spent after mums passing. The estate went from $60k down to $18k.
There also seems to be $25k missing or unaccounted for.
We have decided to fight her on this. Is there a time limit to which we have to do so? Can we claim legal costs if we win?

 

[Sarah J]

1. It is best to sue as soon as possible, however, the limitation is generally 6 years. But this will depend on which State or Territory you live in. Which State or Territory do you live in?

2. If you win in the trial, the judge will make an order as to costs. The usual order is "party-party costs". This means that you can claim for all costs that are reasonably incurred, which from practice, is roughly 2/3 of the actual costs spent. You will unlikely recoup all the costs. After the costs order, the winning party will give an estimation of their costs spend, or a bill, and if the losing party disputes the bill, the matter will then proceed to a costs hearing called "taxation", where a taxing master (court personnel) will go through each item and match it according to that year's schedule of costs. This costs hearing will also incur its own costs which can then be recouped on the same basis.

 

[Tamara]

1. It is best to sue as soon as possible, however, the limitation is generally 6 years. But this will depend on which State or Territory you live in. Which State or Territory do you live in?

2. If you win in the trial, the judge will make an order as to costs. The usual order is "party-party costs". This means that you can claim for all costs that are reasonably incurred, which from practice, is roughly 2/3 of the actual costs spent. You will unlikely recoup all the costs. After the costs order, the winning party will give an estimation of their costs spend, or a bill, and if the losing party disputes the bill, the matter will then proceed to a costs hearing called "taxation", where a taxing master (court personnel) will go through each item and match it according to that year's schedule of costs. This costs hearing will also incur its own costs which can then be recouped on the same basis.

We live in Qld but my mums will and probate was granted in WA.

What would the best course of action? do we ask her directly to explain the missing funds or do we get a lawyer to send a letter

 

[Sarah J]

Hi Tamara,

The aim is to find out what happened to the money (i.e. what did she spend the money on, how much is left etc). If your relationship with the friend is still cordial and you believe she will be cooperative, definitely try and speak with the friend first and ask her the whereabouts of the account (and to provide receipts). If you have not tried contacting the friend before this, contact her and see what she says. You can do this by calling her up together with a formal letter requesting information about the account (this way, you have the request on record). If you cannot get meaningful answers from this friend, then consult a lawyer.

In relation to which state's lawyer: since the super was included in the statement of assets/liabilities for your mum's estate and probate was granted in WA, I would recommend engaging a WA lawyer, or a QLD lawyer that is competent in wills and probate in WA.

Having said that, a lawyer will be costly. During your first interview, ask for an estimate of costs and undertake a risk analysis (ask whether the costs are proportional to your expected/likely outcome).