Can an Executor Withhold Money From a Beneficiary?
From Our “Ask a Question,” Mailbag: “My mother died, and her Will says my sister and I divide everything. My sister is the executor, and she won’t give me my money. She says I am not ready and will waste the money. Can an executor withhold money from a beneficiary?”
Probate Lawyer, Peter Klenk
Can an Executor Withhold Money From a Beneficiary?
When a person dies, there is a process to make sure their assets pass to the correct people. If a person dies owing more than they own, then the creditors get it all. You can’t give your heirs something that you don’t own. But, if your assets exceed your debts, then the executor has money to distribute.
What Are the Executor’s Powers to Distribute?
Once appointed by the state, the executor has a fiduciary duty to secure the deceased person’s assets. Further, the executor has the fiduciary duty to the beneficiaries to distribute the assets as the Will directs. You could have a Will that says, “My Executor can give my things as he wishes.” But, this is not typical. Most typically, Wills clearly state where the probate assets pass.
Sometimes the Will is specific. For example, “$20,000.00 to my friend Jessica Media.” Other times, specific assets are addressed. Such as, “My House in Philadelphia to my Son, Robert Greysferry.” A Will can also place assets in Trust for a beneficiary. The trust typically then has rules about when and how the beneficiary can have use and enjoyment of the trust property.
No matter what the Wills says, though, the Executor is bound to follow the directions.
So, if your mother’s Will says that all her assets are to be divided equally between her two children and there is no trust, then you should receive your inheritance. Your sister has no power to deny what her mother instructed, even if your sister disagrees.
What if the Executor Fails to Distribute the Inheritance?
The executor is given broad powers to secure and preserve assets. But, that power is not limitless. At any time, a beneficiary can bring the Executor to a judge and demand an explanation for the Executor’s action or lack of action.
In your case, if your sister fails to give you an inheritance, you can retain our firm to file a petition with the judge. Your sister, as executor, is legally obligated to respond. She must justify her actions to the judge. Remember, the judge isn’t a detective. The judge can only consider what facts are brought to the hearing. As your attorneys, we can explain to the judge why your sister’s actions are wrong. If the judge agrees, the judge has several options. The judge could order your sister to give you the money. The judge could also remove your sister as executor and appoint someone else to carry out your mother’s wishes.
For more information, follow this link to my article about Breach of Fiduciary Duty.
Can an Executor Withhold Money From a Beneficiary?
I hope you found helpful this short article responding to the question, Can an Executor Withhold Money From a Beneficiary. I have also included some links for more detailed information. If you are curious about updating your Will, Power of Attorney, or Living Will, contact us. Let our Estate Planning lawyers help walk you through what can be a confusing process. In fact, feel free to contact our office for a free consultation.
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