Thursday, 6 July 2017

Executors Commission changes

The right of Executors to charge commission for their services is currently regulated by the Administration and Probate Act 1958 (Vic), the Wills Act 19917 (Vic), The Legal Profession Uniform General Rules 2015 and relevant case law. In Walker & Ors v DÁlessandro [2015] VSC 15, the Court laid down some basic rules to be followed by a Practitioner seeking to take commission from the estate of a deceased person. These, in a nutshell, were that the Practitioner was obliged to provide details of work done to justify the commission separately from details of any charges for legal work, should advise all relevant parties of their right to have the Court review any sum claimed for commission and that the beneficiaries be advised of the desirability of obtaining independent legal advice.
The new Section 65A of the Administration and Probate Act gives the Court power to order the return of excessive commission to an estate upon the application of ANY interested person (including a creditor) and also to do so upon its own motion.
Newly added SS 65B and 65E  preclude commission unless the informed consent of all beneficiaries is provided in writing prior to the execution of the will but permit professional fees in the alternative.
Section 49A of the Wills Act similarly provides that a remuneration clause in a will is void unless the testator provided informed consent prior to the execution of the will.
Section 65C of the Administration and Probate Act permits an Executor to charge commission with the "informed"consent of the beneficiaries. See also Rule 12(4) of the Legal Profession General Conduct Rules in this regard.
Section 65D prescribes the information that must be provided when seeking to take fees and commission. The basis of remuneration, the method of calculation, the estimated value of the payment and the interested parties right to have the amount reviewed must all be disclosed. The information must be provided in writing, in plain English and must also be provided to the parent or guardian of any minor.
Transitional provisions stipulate that the new sections only affect wills signed after they commenced in 2016.

1 comment:

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