When the Court is Prepared to Disallow Executor’s Commission & Order Costs
The Victorian Supreme Court April and June 2022 decisions that lawyer Thomas Koutsoupias’ claim for executor commission and remuneration be disallowed and he pay the interested beneficiaries legal costs demonstrates the Court has zero tolerance for lawyer executors who breach disclosure obligations to will-makers when drawing Wills for them.
Galbally & O’Bryan acted for the interested beneficiary in this test case.
Lawyer Executor – Commission Disallowed & Order to Pay Costs
Key Case Points: Zaprudsky V Koutsoupias
- The will-maker’s estate was worth $1.116 million.
- The will-maker was vulnerable, frail and elderly.
- The will drawn by Mr Koutsoupias included lucrative executor commission and remuneration clauses.
- The interested beneficiary filed a challenge to Mr Koutsoupias’ right to claim executor commission and remuneration due to his failure to obtain the will-maker’s written informed consent to the clauses.
Why the lawyer executor commission was disallowed & costs order in favour of the interested beneficiary was made
On 1 November 2017 Section 65B of the Administration and Probate Act (1958) came into force wherein a will executor has no entitlement to receive a payment under will executor commission and remuneration clauses unless:
(a) the will-maker has given written informed consent to their inclusion; and
(b) the written informed consent was given by the will-maker before the will was signed.
Mr Koutsoupias failed to obtain the will-maker’s written informed consent to the will executor commission and remuneration clauses.
The information Mr Koutsoupias should have given the will-maker to comply with his informed consent obligation should have included:
(a) that there was no automatic right for Mr Koutsoupias to receive a commission or remuneration such that the clauses did not need to be included.
(b) in the absence of commission or remuneration clauses in the will, Mr Koutsoupias can still apply to the Court and subject to court order be allowed a commission not exceeding 5% for his “pains and troubles as is just and reasonable”.
(c) if commission or remuneration clauses are included, the commission or remuneration amounts may be paid irrespective of the amount of work performed by Mr Koutsoupias.
(d) If commission or remuneration clauses are included, then an interested beneficiary would only be able to challenge the level of Mr Koutsoupias’ commission or remuneration via a court application.
The Court ordered Mr Koutsoupias to pay the interested beneficiary’s application costs because notwithstanding his failure to obtain the will-maker’s informed written consent, he failed to concede he had no entitlement to executor commission or remuneration.
Interested Beneficiary – How to Challenge Executor Commission and/or Remuneration Clauses
- A request to the executor to provide all evidence of will-maker written informed consent be made.
- If no will-maker written informed consent and the executor maintains the will commission and/or remuneration are enforceable, a court application to disallow any payment under the clause(s) should be made.
- Even if there is will-maker written informed consent, a court application to reduce the commission and/or remuneration can be made if the amount payable is excessive.
Get Executor Commission Advice Now
Do you have a case to challenge an executor claim to a commission or remuneration?
Galbally & O’Bryan Wills Executor Commission lawyers can provide you with advice.
Partner Andrew O’Bryan and Senior Associate Carl Wilson are expert Wills lawyers and can offer free phone/ first consultation advice.
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