Prickly Probates Series – Mentally Incapable Executors

The first in our Prickly Probates series – People are living longer nowadays as a general rule than they did in previous generations, and while this is lovely in so many ways, it is also causing a prickly issue for probate applications to occur more often.

When someone is appointed as an executor of a will, and they are still alive when the will-maker dies, they are obliged to either apply for probate and administer the estate or to step down as the executor (which allows somebody else to apply for probate and administer the estate). Accordingly, if someone is appointed as executor when the will-maker dies, and that person is not capable mentally of doing either of the above, that creates a Prickly Problem for the Probate Paperwork.

This scenario can come up in any situation but it is particularly often the case when an elderly couple appoints each other as executors in the first instance. Sometimes the surviving spouse, while alive, is not mentally capable of administering the estate of their spouse once their spouse has died.

Happily, there are a number of options to deal with the issue:

THE WILL ITSELF

The will itself provides the easiest solution to this problem if the wording allows it. If the will appoints an executor on the conditions that they are both:

alive; and
able to be the executor;

an executor who is not mentally capable can be simply passed over for the next executor in the list of executors in the will (or any other executor who is appointed jointly with them).

However, many wills appoint the executor only on the condition they are alive, which means that if they are alive but not able, from the court’s point of view, they still expect that executor to apply for probate themselves.

RENUNCIATION

In some cases, the will wording is less important. If the executor is not up to completing the estate administration, but they are well enough in their mind to understand their decision to step down as an executor, they can sign a document to step down as the executor which is called “renouncing probate”.

If renunciation is possible, then it is not important what the will says about the conditions for an executor to be appointed. The executor simply can step down by signing the renunciation document, and that is the end of the issue. Whoever is the next executor in the list of executors in the will can then apply for probate themselves.

PROBATE TO THE ATTORNEY OF MENTALLY INCAPABLE EXECUTOR

There are many situations, however, where:

the executor is not able to renounce; and
the will either does not provide for that executor to be passed over due to mental incapacity; or
the will does allow the executor to be passed over due to mental incapacity, but there are no other executors in the will to use as an alternative.

It is in these situations that an application for probate to the attorney of a mentally incapable executor is most appropriate (and very helpful).

Essentially what this application does is allow someone who has been appointed as an attorney for the mentally incapable executor under an enduring power of attorney to apply for probate on their behalf and perform that executor’s duties in administering the estate on their behalf.

In the example of an elderly couple used earlier, the people who have been appointed attorneys under an enduring power of attorney for the surviving spouse are, more often than not, the couple’s children. These children are also usually the beneficiaries of the will once both parents have died, so it makes good sense that they should take on the role of executor for their deceased parent.

This procedure can also be used for someone who has been appointed a property manager for the mentally incapable executor. The main difference between an attorney in this context and a property manager is that the enduring power of attorney is signed by the person who has become mentally incapable before they became mentally incapable. Therefore the attorney is appointed by that person. Becoming a property manager, however, happens after the person in question has already become mentally incapable (and they have not already signed an enduring power of attorney) and the property manager is appointed by the Family Court.

DIFFERENCES FROM A USUAL PROBATE APPLICATION

There are many differences from a usual application for probate in an application like this, but the main ones are:

the GP of the executor who is mentally incapable has to sign their own separate affidavit for the court which explains that the executor is not capable to administer the estate;
a copy of the enduring power of attorney must be provided as an exhibit to show who has been appointed the attorney under that document; and
the probate that is granted to the attorney for the mentally incapable executor is limited until:
- the mentally incapable executor regains mental capacity and applies for probate themselves;
- three months from the date of death of the mentally incapable executor;
- the attorney ceases to be the attorney of the mentally incapable executor under the enduring power of attorney; or
- the court removes the attorney as executor due to:
  - absence from New Zealand;
  - their wish to be removed; or
  - their incapacity to complete the role of executor.

FOR MORE INFORMATION

If you find yourself in the unenviable situation of requiring a grant of probate when the only possible executor is mentally incapable, get in touch. We can take you through your options and make this complex application simple and painless.

If you are a lawyer struggling to make one of these applications for a client, you might consider using us to complete the application for you. We run a service where we prepare the application, send it to you to sign with your clients, and then we make the application to the High Court. Once complete, we send the successful grant back to you.

Your client need not know we exist (we are simply charged as a disbursement on your invoice to your client) and because we are experienced in making these applications and within walking distance from the High Court probate unit (so our applications are hand-delivered instead of relying on the post back and forth to the court), we can save you and your client time and money. Instead of having to come up to speed on a complex application, you will rarely have to make; we’ll make these applications straightforward and painless for you.

For more information please contact Jenny Lowe. Jenny is one of few legal specialists in New Zealand for probate and letters of administration applications, covering both the simple and the complex. She is particularly skilled in applications where the deceased lived and died overseas, but the estate has assets in New Zealand. Please contact Jenny Lowe by email at jenny.lowe@nzprobatesandreseals.com.