Inheritance

Yes, especially where the executor is also a beneficiary , so that his role involves a conflict of interests, and the offended beneficiary is a charity or social cause, and the bequest is in memory of the deceased or his family. These points were made by Jerusalem Family Court when it accepted a plea by the children’s charity, Ilan, to cancel an agreement, it had entered into with the executor of the will, who together with his wife and children, were the only other beneficiaries under the estate. The court held that the executor of the will had acted in bad faith, and was subject to a conflict of interest. It said it was clear that he had misled the charity’s representative and as a result she had mistakenly signed the agreement which was contrary to the deceased’s wishes.

It relieved the executor of his duties in relation to that part of the will, and increased the amount of money the charity should receive, ordering that the defendant should pay interest on the unpaid difference.

Where an executor of the estate is not sure how to pay off debts , he should apply to court for instructions about this. Basically, where there are insufficient funds in the residual estate to cover the debts after the beneficiaries shares have been put aside, the beneficiaries will have to bear the burden of the debts , according to their relative inheritance. It does not matter whether they inherit financial rights , real estate or moveable property.

No ! The Supreme Court held in the late sixties that the money an executor receives for administering the estate is liable for taxation under the Income Tax Ordinance as it is derived from a job or post. This is so even if the executor did not ask or expect a fee for the services and it was totally dependent on the discretion of some outside source eg the court. It cannot be regarded as a payment in the form of a gift which would not be taxable, it was held.

No – where the executor is also a beneficiary there is a clear conflict of interests between his role to execute the will and his interest to gain under it as a beneficiary. Where there is a problem in executing the will for some reason, then the executor should ask the court for instructions , and in any event, if an agreement is reached whereby the other beneficiary accepts a lesser sum , it would need court approval.

No ! In the late 1960’s the Supreme Court held that a distinction should be made between a person’s share of an inheritance, which is free of tax, and his fee as an executor of the estate, which is taxable as it is income arising from a job or post . Accordingly, tax considerations should be weighed up before an application is made to the court for a fee for services as executor of an estate. Furthermore, the level of the fee set does not depend on what the executor himself asks for – but on the amount of work actually involved, and is at the court’s discretion, up to a maximum figure set in the regulations.

Yes, dismissal is one of several ways in which the role of an executor of an estate may end according the Inheritance Act . The court may dismiss him/her if he/she failed to do their job properly or if it sees another reason for dismissal. It can act on its own initiative or at the request of an interested party.

Under the Inheritance act the Inheritance Registrar and the family court. If all the interested parties agree in writing a religious court can,too.

The Inheritance Law recognizes two situations regarding the appointment of an executor. The first is where there are instructions regarding this in a will and the second where there is no will or the will does not mention an executor.

In the first situation, the court will appoint the person instructed to be the executor in the will, even if the beneficiaries or a third party object, unless it gives special, written reasons for not doing so.

In the second situation the court will appoint someone if all the interested parties give their written agreement to the appointment. Otherwise, the court will appoint a neutral person as it sees fit.

Where the court has discretion not to appoint someone according to the instructions of a will, it must be careful to avoid a person with vested or personal interests that could conflict with the fulfillment of his role. However, just because objection has been made to the will this is no reason to automatically refrain from appointing the person according to the instructions of the will. The court oversees the whole process of the administration of the estate anyway,