An Administrator of an Estate is Not Communicating With The Beneficiaries – Is That Allowed?

When an administrator of an estate is not communicating with beneficiaries, they feel slighted and disrespected. They feel that the administrator is hiding something from them. And they feel that the administrator might be making mistakes or stealing money from the estate.

It is clear that beneficiaries get upset when the administrator is not communicating with them. What is not as clear, however, is how much of a duty to “communicate” an administrator actually has.

An administrator is a fiduciary, meaning that he has a duty to exercise the utmost good faith and undivided loyalty toward the beneficiaries throughout the relationship.^[1] Does the duty to exercise “good faith and undivided loyalty” include a duty to communicate? An administrator “must act in accordance with the highest principles of morality, fidelity, loyalty and fair dealing.” ^[2] Does the administrator’s failure to communicate violate those principles? Here are a few scenarios that shed more light on this issue.

Sometimes the administrator simply does not know that the beneficiaries expect to be communicated with. This is especially true for a first-time administrator. If that is the case, a phone call, email or letter may clear up this misunderstanding.

Some administrators are just not good communicators. They think that as long as they are doing everything right, they do not have to advise the beneficiaries.

An administrator who has not been appointed might think that it’s too early to communicate anything substantial to the beneficiaries since he has not started doing anything yet.

At the same time, some administrators relish the feeling of power and control they have as the administrator, and they want to extend that feeling into an ability to keep the beneficiaries in the dark. And some administrators actually go as far as to steal from the estate.

What recourse do beneficiaries have when they feel that the administrator is hiding information and not communicating with the beneficiaries because the administrator is mismanaging the estate or is stealing money from the estate? The beneficiaries can bring a proceeding to have the judge of the Surrogate’s Court compel the administrator to file an account of the estate. ^[4] If ordered to submit an accounting, the administrator will have to submit it to the court, usually within thirty to sixty days.

The accounting is a set of schedules that include all possible information about the estate, including an itemized list of the assets that are in the estate, the funds or property received by the estate, the expenses of the estate, the beneficiary distributions already disbursed and the beneficiary distributions yet to be disbursed. The beneficiaries can review the schedules and decide that they are satisfied with the information. Or the beneficiaries can compel the administrator to provide all of the documents associated with the estate as well as sometimes the administrator’s personal documents. They can ask for things like account statements, closing statements, tax returns, loan applications etc.

Every administrator who is not communicating with beneficiaries needs to realize that even though in the short term they can hold off beneficiaries requests for information, beneficiaries do get their information eventually, whether the administrator wants it or not. It is better for the administrator to not upset the beneficiaries and to communicate with the beneficiaries. Avoiding acrimony means saving having go through the stress and expense of litigation.

If your administrator is not communicating with you or is withholding information, or if you are an administrator and you think that the beneficiaries are wrongly accusing you of misconduct, you can get in touch with me. I am New York estate lawyer Albert Goodwin and I can be reached at (212) 233-1233.

[1] Leon C. Lazer, et al., New York Pattern Jury Instructions – Civil § 3.59 (2d ed. 2006); see also Sokoloff v. Harriman Estates Development Corp., 96 N.Y.2d 409, 416, 754 N.E.2d 184, 729 N.Y.S.2d 425 (N.Y. 2001); Lamdin v. Broadway Surface Advertising Corp., 272 N.Y. 133, 138, 5 N.E.2d 66, 67 (N.Y. 1936);

[2] In re Estate of Naumoff, 301 A.D.2d 802, 803, 754 N.Y.S.2d 70 (3d Dep’t 2003).

[3] NY EPTL § 11-1.3

[4] NY SCPA § 2205