Why the Role of a Personal Representative Matters
The administration of a deceased person’s estate is founded upon trust, accountability, and fiduciary responsibility. Executors named in a will and administrators appointed through the appropriate legal process are entrusted with significant authority over the assets and affairs of the estate.
Their responsibilities extend beyond simply collecting and distributing property. Personal representatives are expected to administer the estate properly, protect its assets, maintain appropriate records, and act in accordance with their legal obligations and the interests of those entitled to the estate.
When disagreements arise among personal representatives, however, estate administration can quickly become contentious. What begins as a difference of opinion over how an asset should be managed can develop into prolonged disputes, delays, increased costs, and, in some cases, litigation.
Why Executors and Administrators Disagree
Disagreements among personal representatives are more common than many families realise.
Conflicts may arise over:
- The interpretation of provisions in a will;
- The valuation of estate assets;
- Whether particular properties should be sold or retained;
- Investment decisions;
- Payment of debts and expenses;
- The management of family businesses;
- The timing and method of distribution to beneficiaries; and
- The treatment of competing claims against the estate.
Where the estate includes substantial real estate, operating businesses, investment portfolios, or other valuable assets, disagreements can become particularly serious.
Fiduciary Duties of Personal Representatives
Personal representatives occupy positions of trust and responsibility. Under Nigerian law, they are subject to fiduciary obligations in the administration of an estate.
Among other responsibilities, personal representatives are expected to act honestly, protect estate assets, avoid improper conflicts of interest, maintain proper accounts and records, and exercise appropriate care in carrying out their responsibilities.
They should not use their position to obtain an improper personal benefit at the expense of the estate or its beneficiaries.
A failure to properly discharge these responsibilities may expose a personal representative to legal consequences, including potential personal liability in appropriate circumstances.
When One Executor Acts Without the Others
One common source of conflict arises where one executor attempts to exercise authority unilaterally without properly consulting or involving co-executors.
This can create serious practical problems, particularly where major estate assets are involved.
For example, disputes may arise if one personal representative attempts to sell estate property, withdraw or apply estate funds, make significant investment decisions, or otherwise deal with estate assets without proper authority or agreement.
Clear communication and adherence to the applicable legal framework can help prevent such disagreements from escalating.
Proper Accounting Is Essential
Estate administration should be supported by accurate and transparent financial records.
Problems frequently emerge where estate funds are not properly accounted for or where beneficiaries cannot determine how estate assets and income have been managed.
Personal representatives should maintain appropriate records of:
- Estate assets;
- Income received;
- Debts and liabilities;
- Administrative expenses;
- Property transactions;
- Investments; and
- Distributions to beneficiaries.
Proper accounting not only supports efficient administration but also helps build confidence among beneficiaries and reduces the likelihood of allegations of mismanagement.
Conflicts of Interest Can Undermine Trust
Personal representatives may sometimes have personal interests that conflict, or appear to conflict, with their responsibilities to the estate.
For example, a representative may have a personal interest in purchasing an estate asset, may also be a beneficiary, or may have business relationships that intersect with estate transactions.
Such circumstances require careful management and transparency.
Where beneficiaries believe that a personal representative is using their position for personal advantage, disputes can escalate quickly. Identifying and appropriately managing potential conflicts at an early stage can help protect both the estate and the personal representative.
Protecting Family Businesses and Investment Portfolios
Estate administration becomes particularly complex where the deceased owned a family business, shares in companies, rental properties, or substantial investments.
The death of a founder or principal shareholder can create uncertainty regarding who should manage the business, how ownership interests should be dealt with, and how the value of the business should be preserved.
Personal representatives may therefore need to make important decisions while balancing their fiduciary responsibilities with the interests of beneficiaries.
Poorly managed disagreements at this stage can affect the value of the estate itself.
The Court’s Role in Estate Administration
Courts have supervisory powers over the administration of estates and may intervene where circumstances require judicial oversight.
Depending on the nature of the dispute and the applicable law, appropriate proceedings may involve applications relating to the production of accounts, compliance with fiduciary obligations, the preservation or management of estate assets, or the removal and replacement of a personal representative.
The possibility of court intervention makes it particularly important for executors and administrators to understand the scope of their responsibilities before taking significant decisions concerning estate assets.
The Risks of Poor Estate Administration
Failure to properly administer an estate can have consequences for both the estate and the individuals responsible for managing it.
Key risks include:
- Mismanagement or loss of estate assets;
- Conflicts of interest;
- Failure to maintain proper accounts;
- Unauthorised transactions;
- Delays in distributing assets;
- Deterioration in the value of businesses or properties;
- Loss of beneficiary confidence; and
- Costly litigation among beneficiaries and personal representatives.
In complex estates, these risks can significantly reduce the value ultimately received by beneficiaries.
Choosing the Right Executor Is Part of Estate Planning
For business owners, high-net-worth individuals, and families with substantial assets, selecting executors should be approached with considerable care.
Family relationships alone should not necessarily determine who is appointed. Competence, integrity, independence, reliability, financial awareness, and the ability to work constructively with other personal representatives are important considerations.
An individual may be a trusted family member but still lack the skills or temperament required to administer a complex estate.
Where appropriate, professional involvement may also provide additional structure and accountability in the administration process.
Preventing Disputes Before They Begin
Many disputes can be reduced through proper estate planning.
A well-considered estate plan can provide clarity regarding the management and distribution of assets, establish appropriate succession arrangements, and reduce uncertainty among beneficiaries and personal representatives.
Individuals should also consider whether their proposed executors are capable of working together and whether the estate’s complexity requires additional professional support.
Clear instructions, appropriate documentation, proper record-keeping, and open communication can all contribute to a more efficient administration process.
What This Means for Families and Business Owners
The choice of executor or administrator can significantly affect how efficiently an estate is administered.
Individuals preparing estate plans should consider not only who they trust but also who has the competence, independence, judgment, and temperament required to discharge fiduciary responsibilities.
For estates involving businesses, investment portfolios, multiple properties, or complex family arrangements, careful planning can make the difference between an orderly transition and years of avoidable conflict.
Key Takeaway
Estate administration is not simply an administrative task. It is a fiduciary responsibility carrying significant legal obligations.
Personal representatives must understand their duties, act transparently, protect estate assets, maintain proper records, and avoid placing personal interests ahead of the interests of the estate.
For families and business owners, thoughtful selection of personal representatives, combined with proper estate planning and accountability, can significantly reduce disputes, preserve family wealth, and help ensure that the deceased person’s legacy is administered in accordance with their wishes.
Good estate planning does not end with deciding who receives your assets. It also requires deciding who can be trusted to manage those assets responsibly.
A publication of Edidiong Akpanuwa & Co.
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