Legal Question in Wills and Trusts in New York
Executor's Power to ''Sell'' an Asset at No Cost to Someone Not in Will
Is it legally permissible for the executor to ''sell'' a decedent's asset (i.e., home) to one of her children who is not named in the will at no cost (or substantially less than the fair market value)? The executor is the decedent�s daughter and is named in the will to receive 1/2 of the estate with the other 1/2 of the estate to be distributed in 2 equal shares to the children of the decedent's son who died. The will states, in part, the executor can �sell any assets, at public or private sale, for cash or credit, ... lease and dispose of and distribute in kind, all property, real and personal, at such time and upon terms and conditions as she may determine, all without court order.� This seems to suggest that the executor can do as she wishes, regardless of the bequeath distribution requirements. Thanks for any help!
3 Answers from Attorneys
Re: Executor's Power to ''Sell'' an Asset at No Cost to Someone Not in Will
It would be improper for an attorney to provide you with legal advice without having first analyzed all of the facts and circumstances of your particular matter.
However, I will try to provide you with some general information.
An executor has a legal duty to act with the best interests of the beneficiaries in mind. Any actions by the executor that deviate from this standard may be challenged in Surrogate's Court.
If you decide that you would like to retain an attorney, please feel free to keep me in mind (212) 971-1384.
Re: Executor's Power to ''Sell'' an Asset at No Cost to Someone Not in Will
While the executor has the right and discretion to follow the terms of the Will, a fiduciary duty of fairness and good faith is imposed for the benefit of all named beneficiaries. The proposed act, essentially giving away the house for nothing, appears to breach the duties owed, unless there is some verification of this right. Not naming the proposed "buyer" in the Will is some verification that the buyer was not intended to benefit in any way. Of course the executor can do with her share anything she wants (including giving it to anyone), but this does not apply to the remainder. More facts are needed as to why the proposal has been made. I recommend that the remaining people consider retaining an attorney familiar with estate matters with a view to bringing an action in the Surrogate's Court for breach of fiduciary duty and such other claims as these facts may raise. While the language in the Will is quite broad, and, on its face, appears to allow the proposed activity, this does not override the responsibility owed to the remaining beneficiaries in the absence of other facts.
Re: Executor's Power to ''Sell'' an Asset at No Cost to Someone Not in Will
I do not believe the transavtion you suggest would be a proper use of executor's power. An executor is required to act in the best interest of the named distributees, the transaction you describe would be cutting out the distributees in preference of a non-named person. This reeks of bad faith, and unless you can show that this would have been the intention of the testator I would strongly suggest you rethink your proposal.
Should you like to discuss this or any other legal matter, you can call my office to schedule an appointment for a consultation or in the alternative, I can be reached for on-phone low-cost legal consultation at 1-800-275-5336 x0233699.
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