The best way to pay your executor

Last week's article on the calculation of executor's commission has generated fresh questions and comments which deserve some attention.

Let me start by saying that an executor is the person appointed under the will to do the work necessary to carry out the executor's wishes. In other words, the executor is responsible for winding up the estate. For his efforts, the law entitles him to receive compensation in the form of a commission equivalent to six per cent of "all sums paid by him" (section 48 of the Administrator General's Act).

Most people do not realise that an executor may also be a beneficiary under the will. Where this occurs, the law presumes that the gift to the executor is his compensation for winding up the estate, and some attorneys advise their clients to make this provision in their will in order to avoid having the executors collect a hefty commission calculated at the rate of six per cent of all sums paid by him.

The fact is that this may not always yield the result you seek. If the clause giving the gift to the executor in his capacity as executor is not carefully worded, it could allow the executor to accept the gift, although refusing to act or being incapable of acting as executor. For example, the cases show that a clause which states that a gift is to "my friend and executor" will allow the executor to choose the gift and decline to be executor, but a clause which states that a gift is to "X in his capacity as executor".

Perhaps the best approach to dealing with the problem is to first decide whether you would like to compensate your executor and then determine what sum you would consider adequate. Depending on the response to those questions, one prominent attorney has suggested that you could then insert a clause in the will which clearly states that:

There shall be no compensation at all; or

That compensation shall be calculated at the rate of "x per cent of the gross value of the estate; or

Make a specific provision in the amount of "$x" to be paid to the executor.

Another troublesome question relates to the amount of work the executor is obliged to undertake before he can say that he has earned his commission. Is he to get paid once he has received the grant of probate, at some time before the estate is fully administered or when the estate has been fully administered? This may be the topic of another article, but the 'Theobald on Wills' suggests that it is sufficient if he proves the will.

The word of caution underlying this issue is that it is important to seek legal advice in an effort to ensure that your will is carefully drafted and your intentions are clear.

Sherry Ann McGregor is a partner and mediator with the firm of Nunes Scholefield DeLeon & Co. Please send feedback and questions to lawsofeve@yahoo.com or lifestyle@gleanerjm.com.