- Executors and Administrators of an Estate have significant discretion in the probate of an Estate under New Jersey Law.
- This article addresses important principles of Estate Administration decided by the courts regarding the role and decisions of Estate executors and administrators.
Like it or not, an Estate representative has a lot of freedom and discretion when it comes to probating the administration of an Estate.
Are There Time Limits for Executors to Perform an Accounting?
NJ Courts have consistently ruled on challenges to the actions and decisions taken by an Executor-Administrator stating that there is no statutory authority requiring an Executor to inform a beneficiary regarding Estate assets and liabilities within any specific timeframe, and there must be clear and convincing evidence to demonstrate special causes to warrant an accounting prior to the one year period set forth in N.J.S.A. 3B:17-2. Most often a judge will deny a request for an accounting without prejudice to a beneficiary’s right to challenge a final accounting. When the one year is up, most Judges also find that an Estate representative does not abuse his or her authority or violate their fiduciary duty when he or she has mad unilateral decisions without approval of the beneficiaries during the first year of estate administration.
Remedies Available to the Courts When Deciding Cases Involving Executors and Administrators
When deciding cases challenging a fiduciary’s handling of an Estate, our Appellate Courts have found “Remedies available to Courts of equity ‘are broad and adaptable’” (meaning the judge can do what he/she wants within a certain limits). “While equitable discretion in Estate matters is not governed by fixed principles and definite rules, implicit in the exercise of equitable discretion is a conscientious judgment to achieve a just result.
“A trial court’s rulings on discretionary decisions by Executors and Administrators are entitled to deference and will not be reversed on appeal absent a showing of an abuse of discretion involving a clear error in judgment.” “An abuse of discretion” occurs, for example when a trial judge’s “decision is made without a rational explanation, inexplicably departed from established policies, or rests on an impermissible basis”.
Issues Involving the Distribution of Estate Assets
In disputes over the distribution of the assets of an estate “a court first looks to the language of the Will to determine if the testator expressed intent as to how the property should be distributed.” A Court reviews the meaning of the Last Will. When a Will clearly expresses an intent that all of the Estate property should be sold and the proceeds distributed in cash, not in kind, a beneficiary must accept a cash distribution from the Estate.
In kind distributions are only permitted where:
- The person entitled to the payment has not demanded payment in cash;
- The property distributed in kind is valued at fair market value as of the date of its distribution; and
- No residuary devisee has requested that the asset in question remains a part of the residue of the Estate
So if a decedent’s last will mandates an Estate to liquidate to cash and distribute it to beneficiaries, that is what a court will order.
To discuss your NJ estate administration and probate matter, please contact Fredrick P. Niemann, Esq. toll-free at (855) 376-5291 or email him at fniemann@hnlawfirm.com. Please ask us about our video conferencing consultations if you are unable to come to our office.
By Fredrick P. Niemann, Esq. of Hanlon Niemann & Wright a Freehold Township, Monmouth County, New Jersey Probate Estate Administrator Attorney