NSW Is the estate legally liable to reimburse an executor for private legal advice

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PeterP

Active Member
22 August 2021
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31
The estate has been administered and all money is in trust waiting for distribution. One executor employed a solicitor privately to communicate with the other executors. The estate was sent invoices for the independent legal fees by this solicitor and a direction for these to be paid from estate funds. When the invoices where questioned the solicitor cited sect 59(4) of the Trustees Act (NSW) as being relevant and allowing the expenses to be claimed against the estate.

Is the estate legally liable to pay? Action to recover the money on behalf of their client has been threatened.
 

Docupedia

Well-Known Member
7 October 2020
364
51
794
Section 59(4) states:
(4) A trustee may reimburse himself or herself, or pay or discharge out of the trust property all expenses incurred in or about execution of the trustee's trusts or powers.

The emphasis here is "...incurred in or about execution of the trustee's trusts or powers."

I would consider that needing a lawyer to communicate with the other executors is less about 'execution of the role' and more about 'the relationship between the executors'.
 

PeterP

Active Member
22 August 2021
8
0
31
Thanks for the response. Would 59(4) apply to executors as well as trustees? I understand there are times when an executor is both but if still undertaking duties as an executor and the independent solicitor had not involvement with the management of money in trust waiting distribution (which is still the role of an executor) my question would be - is there any other legislation that would make the estate legally liable for this expense? The construction of the Will appointed executors as trustees also. We need to make a decision about whether we should defend the claim.
 

Docupedia

Well-Known Member
7 October 2020
364
51
794
Executors are trustees. You’d need to get specific advice on the actual circumstances to see whether any other legislation applies.