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Legal costs and deceased estates – who pays?

A common question for an executor or the administrator of an estate is – who pays for legal costs I incur? It’s an important question, particularly because legal costs will often be one of the first expenses that are incurred when administering an estate.

Ordinarily, an executor/administrator is entitled to be reimbursed from the estate’s assets for the legal costs they reasonably incur in the course of administering an estate. They may not be entitled to be reimbursed where the costs are excessive or unreasonably incurred or incurred in pursuit of matters that are not connected to the estate. Additionally, different rules may apply for costs incurred where the executor/administrator incurs those costs for a personal benefit or a matter not for the benefit of the estate.

Importantly, the right to reimbursement is a legal entitlement. The practicalities are a separate matter. Usually, a grant of representation (either a Grant of Probate or a Grant of Letters of Administration) is required before the executor/administrator can access the deceased’s bank accounts. Obtaining the grant will often requires legal representation and lawyers (like many other professionals) will ordinarily require payment for their fees in advance.

In many instances, an executor/administrator (or another relative) is able to pay for the legal fees in advance and obtain reimbursement once they obtain control of the deceased’s assets. In some situations where upfront payment is not possible, lawyers may be prepared to advance credit until reimbursement can be made (often charging a premium for this service).

A trickier situation is where there is a dispute about the validity of a Will or about the grant of representation. In these cases, the matter will need to be determined by the Court and orders for costs will be made at the conclusion of any trial. In those instances, the parties to the dispute will need to bear their own legal costs until the matter is concluded.  

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