Personal Representatives, Trustees and Beneficiaries
Core concepts
Distinguish the personal representative (executor or administrator) from the trustee. The personal representative administers the estate; the trustee holds property on trust for beneficiaries after administration ends. The same person may act in both capacities, but the duties differ.
Duties and liabilities
Personal representatives and trustees owe fiduciary duties: to act in good faith, to avoid conflicts of interest, not to make secret profits, and to act within their powers. They must exercise reasonable care and skill - a higher standard for a professional. They are liable for devastavit and for breach of trust, but may be relieved by the court where they acted honestly and reasonably.
Beneficiaries
Beneficiaries have rights to information, to accounts, and to compel proper administration. They may sue for breach of trust or devastavit. Their interest may be vested or contingent, and questions test the difference.
Traps
Watch the self-dealing rule, the rule against conflict, and the position of a personal representative who is also a beneficiary. Also test the appointment and removal of trustees and the effect of a power of appointment.
Rule of thumb
Ask: in what capacity is this person acting, and what duty attaches to that capacity?