“At first glance, naming two executors to jointly administer an estate seems like a smart idea, but can naming co-executors also be more trouble than it’s worth?” – James Dolan, 2019
Managing the affairs of a deceased loved one’s estate is a task that requires the utmost consideration and planning. While the idea of appointing co-executors may seem like a practical solution, the reality often unfolds as a complex dynamic with both benefits and challenges. In this blog post, we will set out to answer the question asked by author James Dolan in his 2019 article titled: Are Co-Executors a Good Idea?
Siblings as co-executors
Appointing multiple executors is not a new practice and may be more common than you think. Most clients appoint their children as joint-executors, sometimes simply to avoid offending one child. Dolan cites Gurpreet Randhawa, principal at Sitka Law Group who shares words of caution on such arrangements. “Rather than making the relationship better, and resolving past conflict, it probably would have the opposite effect.”
To avoid such problems, Randhawa suggests will-makers look for warning signs of future conflict between proposed co-executors, such as whether they get along, whether they live in different cities, or if one might not be able to share the same work-load due to work or life circumstances.
Family member and financial professional as co-executors
Another common practice seen is to appoint both a family member and a financial professional, which can bring a diverse skill set to the table. This approach aims to balance the emotional and practical aspects of estate management. Dolan cites an example offered by Solange Buisse, associate with Taylor McCaffrey Lawyers who states, “The Son can work on emptying the house and dividing the personal effects, while the accountant can work on winding up the family corporation.”
Co-Executors: Pros & Cons
A benefit of co-executors is that it creates “checks and balances.” Buisse goes on to explain that a Testator may trust their kids to make good choices, but all decisions must be jointly reviewed and approved by all executors. This creates a natural “double check” on all estate decisions. However, Buisse also underscores a critical caveat that might not be immediately apparent to many: in most Canadian jurisdictions, co-executors share joint liability for all decisions irrespective of their individual involvement.
This legal nuance creates potential pitfalls for co-executors and emphasizes the need for a comprehensive understanding of the risks associated with this role.
In conclusion, the selection of co-executors demands a balance between leveraging complementary skill sets and working cooperatively to mitigate the potential risks. Prospective testators and their advisors must be careful to assess their individual circumstances and family dynamics to ensure their decision aligns with their estate distribution wishes. To conclude his key points, Author James Dolan leaves us with a comprehensive Pros & Cons list:
Pros
- Dual perspectives
- Professional expertise (if working with a professional co-executor)
- Division of labour
- Checks and balances (ability to double check your decisions with a co-executor)
Cons
- Potential for delays due to coordination
- Potential to amplify underlying family conflicts (if co-executors are siblings)
- Joint liability (co-executors are equally liable for each other’s actions)
Get trusted estate planning advice
Have questions about estate planning? We’re here to help. Get in touch with an advisor today and take control of your financial future.