Selecting an executor or trustee is one of the most important decisions a person can make when preparing an estate plan. At Boroja, Bernier & Associates, we understand that this choice carries both legal and personal consequences. The executor or trustee is responsible for carrying out the instructions in an estate plan, managing assets, paying debts, and distributing property according to Michigan law. Choosing the wrong person can result in delays, disputes, or even litigation. Michigan residents who plan ahead and select a trustworthy, capable individual can help ensure that their estate is administered smoothly and in full compliance with the law.
Understanding The Role Of An Executor And Trustee
An executor is the individual appointed under a will to manage the estate after death, while a trustee is responsible for administering a trust according to its terms. Both roles carry fiduciary duties, meaning the person must act in the best interests of the beneficiaries and the estate. Under the Michigan Estates and Protected Individuals Code (EPIC), MCL 700.3703, executors must settle and distribute an estate as efficiently and fairly as possible, consistent with the law and the terms of the will. Trustees under MCL 700.7801 must administer the trust in good faith and in accordance with its terms.
In both cases, the person chosen takes on significant responsibilities. They may need to handle real estate sales, investment management, payment of taxes, and communication with heirs. Because of these obligations, the decision should never be made lightly.
Qualities To Look For When Choosing An Executor Or Trustee
The best executor or trustee is someone who is honest, organized, and has sound judgment. While family members are often chosen for these roles, emotional ties can sometimes complicate the process. A neutral third party, such as a trusted advisor or professional fiduciary, can reduce the risk of family conflict. Michigan law does not require an executor or trustee to live in the state, but selecting someone familiar with local laws and financial institutions can make the process smoother.
It is also important to consider the person’s financial literacy. Executors and trustees must maintain accurate records, handle tax filings, and make decisions regarding investments. If the estate or trust involves complex assets, such as business ownership, rental properties, or investment portfolios, a person with financial or legal experience may be a better fit than a relative unfamiliar with those areas.
Common Legal Challenges With Executors And Trustees
Disputes often arise when beneficiaries believe the executor or trustee has failed to fulfill fiduciary duties. Under MCL 700.7802, fiduciaries are required to act loyally and impartially toward all beneficiaries. If an executor or trustee favors one party over another, mismanages funds, or withholds information, beneficiaries may file a petition with the probate court to seek removal or an accounting.
In some situations, co-executors or co-trustees may be appointed, which can provide checks and balances but may also create delays if they disagree. When conflicts arise, the court may intervene to ensure that the estate or trust is administered in accordance with Michigan law.
The Importance Of Successor Executors And Trustees
Planning for the unexpected is an essential part of estate management. The chosen executor or trustee may be unable or unwilling to serve at the time of need. For this reason, it is wise to name successor fiduciaries in the will or trust. A successor executor or trustee steps in if the primary appointee is unavailable. This foresight helps prevent court delays and ensures that the estate is not left without leadership.
When To Consider A Professional Fiduciary
For complex or high-value estates, hiring a professional fiduciary may be the best option. Banks, attorneys, and trust companies often serve as trustees or personal representatives in Michigan. Professional fiduciaries charge fees, but their expertise can prevent costly mistakes and reduce the likelihood of disputes. Individuals with blended families or contentious relationships among heirs may also benefit from a neutral professional administering their estate or trust.
Reviewing And Updating Fiduciary Appointments
Estate plans should be reviewed every few years or after major life changes such as marriage,
divorce, or the death of a previously named executor. Changes in relationships, financial circumstances, or state laws can all affect whether the chosen executor or trustee remains the best choice. Regularly updating these appointments helps ensure that the estate plan reflects current wishes and circumstances.
Michigan Estate Planning Frequently Asked Questions
What Are The Main Differences Between An Executor And A Trustee?
An executor handles a person’s estate after death, ensuring that debts are paid and assets are distributed according to the will. A trustee manages assets held in a trust, often both during the grantor’s lifetime and after death. Executors operate under court supervision, while trustees typically manage affairs privately according to the trust’s terms.
Can A Beneficiary Also Serve As An Executor Or Trustee?
Yes, under Michigan law, a beneficiary may also serve as executor or trustee. However, this dual role can create conflicts of interest if decisions appear self-serving. When family dynamics are strained or complex, it may be better to appoint an independent party to maintain neutrality and fairness.
What Happens If The Executor Or Trustee Fails To Perform Duties Properly?
Beneficiaries can petition the probate court for removal or a formal accounting if a fiduciary mismanages the estate or violates duties. The court may order restitution, appoint a new fiduciary, or impose other remedies to protect the estate’s assets and beneficiaries’ rights.
How Often Should Fiduciary Appointments Be Reviewed?
It is recommended to review fiduciary appointments every three to five years, or sooner if significant changes occur in relationships, finances, or applicable laws. Regular review ensures the named executor or trustee is still the best choice and capable of fulfilling the role when the time comes.
Is It Better To Appoint One Executor Or Multiple Executors?
Multiple executors can share responsibilities and provide oversight, but coordination between them can be difficult. Having one capable executor supported by professional advisors may result in a more efficient administration.
What Are The Costs Associated With Hiring A Professional Fiduciary?
Professional fiduciaries typically charge fees based on a percentage of the estate’s value or an hourly rate. While this adds expense, professional administration can prevent disputes, minimize tax issues, and ensure compliance with Michigan probate requirements, which may ultimately save money and time.
Call Boroja, Bernier & Associates For Guidance
Selecting the right executor or trustee is one of the most important decisions in estate planning. The attorneys at Boroja, Bernier & Associates help individuals and families make informed choices that protect their wishes and preserve family harmony. With offices in Troy, Michigan, and Shelby Township, Michigan, the firm serves clients throughout Oakland County and Macomb County.
Call the Michigan estate planning attorneys at Boroja, Bernier & Associates by calling 586-991-7611 for a free consultation. Learn how thoughtful estate planning can provide peace of mind and ensure that loved ones are protected.
