If you've been chosen as an executor in a will but can't or don't want to fulfill the duties, you can step down. This involves signing a "power reserved" form, which legally releases you from the responsibility.
In this article, we'll explain what "power reserved" means in probate and how it works.
What does "power reserved" mean in probate?
With power reserved, executors of a will can choose not to be actively involved in managing the estate.
When someone writes a will, they appoint an executor. This role involves important tasks like sorting out the person's belongings, paying debts, and giving out inheritances as stated in the will.
However, an executor can decide not to take on this responsibility. Some people do this because they don't want to deal with the potential risks involved, others because they're grieving or facing challenges like living far away or being unwell.
Who can have power reserved in probate?
You don't have to be an executor if you don't want to.
You can choose to reserve power instead. This means you won't be active in managing the estate for now, but you can step in later if you want to. In the meantime, other executors will handle things. They'll get a Grant of Probate, showing that you have power reserved. This lets them manage the estate while you have the option to join in later.
What tasks can be covered by power reserved?
When an executor reserves power, they should stay out of the day-to-day estate management.
If they later want to get involved after probate has been granted to another executor, they need to apply for double probate if there are four or fewer executors handling the estate.
How is the executor chosen to have power reserved?
When there are multiple executors in a will and one decides not to join in the probate process, they reserve power for themselves.
The active executor lets the court know they'll handle probate alone. The court grants probate to the active executor but notes that the other executors have power reserved. This can happen only if the will names other executors who can take over or if there are already multiple executors involved.
If the will has only one executor, that person must decline their role entirely to be excused from their duties and responsibilities.
Is there a time limit on power reserved in probate?
There's no set time limit for an executor to change their mind about reserving power in probate. However, beneficiaries might get impatient if they feel executors are withholding money or assets. If it goes on for over 12 months, beneficiaries could claim interest at the statutory rate.
Can power reserved be reversed or modified?
Power reserved can be reversed easily if someone decides they want to get involved in managing the estate later on.
But, if an executor has already started working on the estate administration, they can't step back. Intermeddling happens when an executor starts managing the estate. So, if you've already begun, you must keep acting as executor.
How does power reserved impact beneficiaries?
An executor cannot change a will. When one executor reserves power and the others take on the estate management, the will must be followed as written, and all beneficiaries must receive what they're entitled to.
The other executors have a legal responsibility to the beneficiaries. They must follow the will's instructions and avoid causing financial harm to the beneficiaries. If they do cause harm, they could be held accountable for any losses. This duty applies to each beneficiary named in the will.
What if there is a dispute over power reserved?
In will disputes, claims usually don't target executors with reserved power since they have limited liability. Legal claims on an estate typically focus on active executors managing the estate, as they're responsible for any problems.
If an executor refuses to step back or can't because they've already handled the estate, a beneficiary may have to go to court to replace them. This should be a last resort because, if the claim fails, the beneficiary might have to pay legal fees.
How can I ensure power reserved is handled smoothly?
To handle power reserved smoothly, complete and return the Power Reserved Form to the probate registry. This form shows that, as a named executor, you currently choose not to fulfill your role but reserve the right to do so later.
A probate solicitor can help you fill out the form correctly and manage the estate when you decide to resume your role. Alternatively, you can appoint a solicitor to assist you as executor instead of reserving power.
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