Personal
Corporate Executor / Trustee
The role of an Executor
An Executor is someone chosen in a Will to handle a person’s assets and liabilities.
The Executor takes on the important role of adminstering the deceased estate, such as managing assets and following the instructions in the Will.
This should include:
Checklist
Asset
Inventory
- Compile a detailed list of the deceased person’s assets
Probate
Process
- Initiate the probate process
- Provide the original copy of the Will
Debts &
Expenses
- Identify and notify potential creditors
- Manage outstanding debts, taxes and expenses from the estate
Clear
Accounting
- Have clear record of inflows and outflows
- Safeguard the estate’s assets
Communication
with Beneficiaries
- Keep beneficiaries informed of progress
Legal &
Administrative Tasks
- Handle any disputes that may arise
- Complete administrative tasks like closing accounts and cancelling subscriptions
Distribution
of Assets
- Follow the instructions in the Will
- May involve selling property, transferring ownership, or distributing specific items to beneficiaries
Closing of
the Estate
- Prepare a final accounting of the estate’s assets, expenses and distribution
This job can be tough, especially for complicated estates. Appointing family members as Executors might be hard for them, especially when they’re already emotionally overwhelmed with the loss of a loved one.
Appointing a professional Executor may be a better option as it can alleviate the challenges and emotional strain associated with administering a loved one’s assets.
Value of a corporate Executor
In Singapore, one such option is appointing a licensed trust company to act as the corporate executor. The question is how different it is between appointing a corporate Executor and appointing an individual as the Executor? A corporate executor is useful in the following scenarios:
- When the testator has no reliable individual to act as the executor. This could be due to a small nuclear family or when all the beneficiaries are minors
- Potential conflict among family members and avoidance of disputes
- Family members are all overseas
Assessing the value of a Corporate Executor in Estate Administration
Comparison of an Individual Trustee and Corporate Trustee
Individual Trustee | Corporate Trustee | |
|---|---|---|
Objectivity | • Have personal knowledge, relationships and familiarity with the family dynamics, which can lead to conflicts of interests. • Usually accepted based on a personal relationship and favour. | • Objective in decision-making. • Not influenced by personal relationship or family dynamics. • Reduces frictions amongst family members and maintain harmony. • Higher level of expectation on fiduciary duty to the trust. |
Expertise | • Lack of professional expertise can pose challenges in handling complex trust matters. | • Dedicated expertise in trust administration. • Experienced in trust matters arising for day-to-day handling of past and existing trusts. • Structured approach to managing trusts, ensuring compliance with regulations and best practices. |
Succession Planning | • A change of trustee requires a deed of appointment and transfer of the Trust’s assets to the new Trustee. This can be cumbersome. | • If directors or employees of the corporate Trustee change, the corporate Trustee remains the same legal entity, and there is no need to transfer assets to another entity. |
Liability | • The Trustee is responsible for the Trust’s affairs and debts and can be held personally responsible. | • A company is a separate legal entity, and the directors of the company have limited personal liability. |
Continuity and Perpetuity | • Limited to the age, health or changes in personal circumstances. • May resign, become incapacitated and disrupt the trust administration. | • Advantage of continuity and perpetuity. • Consistent management of the trust assets over the long term. |
Cost | • Zero to low fees, especially if a family member or a close friend may serve without compensation. | • Ongoing annual fees based on a percentage of the trust assets. |
Case Study of a recent case we handled
