Do you own a business or a large estate and are worried about what will happen to it after your death? Appoint an estate administrator. He or she will ensure that your business and assets are still treated as you would wish after your death. In this article, we’ll look at exactly what an estate administrator does, how to appoint one and how to remove one.
An estate is a set of property rights and obligations that pass to heirs upon a person’s death. It includes all the property left over from the deceased person, including real estate, movable property, shares in companies, money, debts and rights and obligations.
Inheritance law then determines how the property is distributed among the heirs and what their obligations are towards the deceased’s debts or liabilities. This process of dividing the estate is called probate and is initiated after the death of an individual (the testator) to determine who inherits the property left behind by the testator and how. Inheritance proceedings may be conducted according to a succession contract, a will or the law.
The succession proceedings may also determine whether there are debts or liabilities of the deceased that need to be paid out of his estate. We discuss what to do with inherited debt in our article.
A testator is a deceased person who has left behind property to be inherited. It is the term used for a person whose estate is subject to probate. The testator may specify in his or her will how his or her estate is to be distributed among the heirs, or, in the absence of a will, the rules of succession law apply to determine who inherits and to what extent. The testator is also the person who can determine who will be the administrator of his or her estate.
The administrator of the estate is the natural person or legal entity appointed by the testator to administer the estate (i.e. the property of the deceased testator). His or her task is to administer the assets of the estate until the probate proceedings are concluded.
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The administrator of the estate is obliged to perform his or her duties in accordance with the law or the instructions of the testator. The Civil Code grants him the following duties and rights:
The administration of the estate consists in particular in securing and protecting all the property left behind by the testator. This may include real estate, money, securities, personal effects and other assets. In practice, however, an administrator of the estate is appointed especially if the testator owned a business that needs to be administered.
In this case, the administrator of the estate is then responsible for ensuring the operation of the business, meeting obligations to employees and clients, etc. The administrator must therefore manage the financial affairs of the business, including the management of bank accounts, the payment of employees and the repayment of suppliers and other liabilities.
He is also responsible for the actual management of the business and for compliance with all legal and administrative obligations relating to its operation. This includes, for example, filing tax returns, complying with employment regulations and fulfilling other corporate governance obligations.
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If necessary, the administrator of the estate shall make provision payments to persons entitled to them. This means that the administrator of the estate can, if necessary, provide funds for the subsistence needs of persons entitled to inheritance. The aim is therefore to ensure that the heirs are not in a difficult financial situation, for example because of lengthy succession proceedings.
This may be the case, for example, of a dependent spouse of the deceased who does not have the financial means to cover essential living expenses such as rent, utility bills or routine food and medical expenses.
The administrator of the estate is tasked with delivering a report to the legatees about the bequests that have come to them. A legacy is an institution that allows the testator to remove an object from the estate and give it to a specific person who is not automatically an heir under the law.
In practice, this means that the administrator of the estate is obliged to inform the persons designated by the testator in his will as legatees of the specific objects bequeathed to them.
The administrator of the estate may sell, lease or mortgage the property entrusted to him, but only if this serves to preserve the value or substance of that property. This is provided that the administrator acts for the benefit of the heirs and in accordance with the interests of the estate.
An example might be where the testator left behind a large parcel of land which was used as agricultural land. The administrator of the estate decides that it would be more efficient and in the interests of the heirs to lease this land to a local farmer. This will both preserve the value of the land used for farming and contribute to the financial security of the heirs.
Are you planning to draw up a succession agreement? Read on to find out what the rules are and what should be in it.
In certain situations and with the consent of the heirs or the court , the administrator of the estate may act outside the ordinary administration of the estate. For example, if the testator owned a large collection of artworks and one of the heirs proposes that this collection be displayed in a public museum to promote the artworks and increase their value.
The testator may appoint the administrator of all or part of the estate by means of a notarial deed or public deed. The testator may impose specific duties and conditions on the administrator, such as the payment of the debts of the testator, dealings with heirs and third parties, and other administrative acts related to the succession. In some cases, the court may also appoint an administrator of the estate.
The testator is also able to specify how and whether the administrator will be remunerated for his services. The remuneration of the administrator of the estate may, for example, be set as a fixed amount or as a percentage of the value of the estate administered.
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The administrator of the estate may also be removed from his/her office, even after the death of the testator and the opening of succession proceedings. Anyone who is a party to the proceedings concerning the estate and whose legal interests are affected by the activities of the administrator of the estate may file a petition for the removal of the administrator of the estate . The court may also dismiss the administrator on its own initiative. An appeal may be made only onthe grounds laid down by law:
In addition to the administrator of the estate, the executor of the will or the heirs may also be in charge of the administration of the estate. The executor of a will is the person whom the testator has appointed in his will to carry out his last will and ensure its execution.
In the absence of the appointment of an administrator of the estate or an executor of the will, all the heirs are in charge of the administration. They are therefore joint administrators of the estate and have the right to decide on the administration of the testator’s estate.
If you own ordinary property, then usually there is no need for an administrator of the estate. However, if you own a business or have a large and complex estate (for example, land that needs to be looked after) then an estate administrator may be worthwhile. This is because you need to appoint someone to such a role who is familiar with your business and assets and knows how to handle them properly. An estate trustee can ensure the continued operation of the business and protect its value during the probate process and ensure that everything runs smoothly.
The administrator of the estate is the person in charge of administering the estate until the succession proceedings are completed. He or she is responsible for safeguarding and protecting the estate, dealing with the financial affairs of the business, dealing with legacies and arranging for payments to be made to beneficiaries. The administrator may be appointed by the testator or by the court and may be removed on the grounds of serious breach of duty or other serious reasons.
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Ondřej is the attorney who came up with the idea of providing legal services online. He's been earning his living through legal services for more than 10 years. He especially likes to help clients who may have given up hope in solving their legal issues at work, for example with real estate transfers or copyright licenses.
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