EPTL 11-1.1: The Statutory Powers of New York Executors and Trustees

EPTL 11-1.1 is the statute that answers the most common question fiduciaries ask: “Am I allowed to do this?” It gives every New York executor, administrator and trustee a default set of powers to collect, manage, invest, sell and distribute estate and trust property without asking the Surrogate’s Court for permission each time. If the will or trust instrument is silent, the fiduciary looks to this statute. If the will or trust says something different, the instrument controls.

The statute matters in two directions. A fiduciary needs to know what he can do on his own signature. A beneficiary needs to know when the fiduciary has gone beyond the statute, because an act outside the statutory powers can be undone, surcharged, or made grounds for removal.

Who the Statute Covers

EPTL 11-1.1(a) defines “fiduciary” broadly. The statutory powers belong to executors named in a will and appointed by the Surrogate’s Court; administrators appointed when there is no will, who then distribute property under EPTL 4-1.1, the intestate succession statute; administrators c.t.a., appointed when a will exists but the named executor cannot serve; preliminary and temporary fiduciaries, subject to any restrictions in their letters; and trustees of testamentary trusts and lifetime express trusts.

The powers apply “in the absence of contrary or limiting provisions” in the will, the trust instrument or a court order. That opening phrase of EPTL 11-1.1(b) does most of the work in litigation. A power that appears in the statute can still be off-limits to a particular fiduciary because the testator restricted it or the court limited the letters under SCPA 702.

The Core Powers Under EPTL 11-1.1(b)

Power to Invest and Reinvest

EPTL 11-1.1(b)(3) authorizes the fiduciary to invest and reinvest estate and trust property. The power to invest is separate from the standard that governs how the investing must be done. That standard is the Prudent Investor Act, EPTL 11-2.3, which requires the fiduciary to consider the portfolio as a whole, diversify unless it is prudent not to, and match the investment strategy to the purposes of the estate or trust. Having the power to invest never excuses a fiduciary from that standard. An executor who parks $700,000 in a single stock for three years while the estate is open has exercised a statutory power imprudently, and imprudent exercise is surchargeable.

Power to Take Possession, Manage and Collect

Under EPTL 11-1.1(b)(5)(A), the fiduciary may take possession of property, collect rents and income, make ordinary repairs and manage the property generally. For an estate that owns a two-family house in Queens, this is the provision that lets the executor collect the tenant’s rent, pay the property insurance and fix the boiler, all from estate funds and without court involvement.

Power to Sell: EPTL 11-1.1(b)(5)(B)

This is the most frequently cited subsection of the statute. The fiduciary may sell property at public or private sale, on terms the fiduciary considers appropriate. Three points about this power are regularly misunderstood.

It covers real property. Even though legal title to a decedent’s real property vests in the beneficiaries or distributees at the moment of death, that title is subject to the fiduciary’s statutory power of sale. An executor or administrator can sign the contract and the deed as fiduciary.

It applies to administrators, not just executors. An administrator of an intestate estate has the same power of sale as an executor. Court permission is generally not needed to sell the decedent’s house in intestacy.

It does not apply to specifically disposed-of property. If the will says “I devise my house at 123 Main Street to my daughter,” the house passes to the daughter directly and the executor has no statutory power to sell it. Selling specifically devised real property requires the devisee’s participation or a court proceeding under SCPA Article 19, which permits a disposition of real property for enumerated purposes such as paying debts, administration expenses or taxes.

Power to Lease

EPTL 11-1.1(b)(5)(C) lets the fiduciary lease estate or trust property. In practice this means an executor can keep a rental unit occupied and producing income during administration rather than leaving it vacant. Long-term leases that would tie the beneficiaries’ hands for years after the estate should have closed invite objections at the accounting, so fiduciaries typically keep lease terms short unless the will grants broader authority.

Power to Contest, Compromise and Settle Claims

Under EPTL 11-1.1(b)(13), the fiduciary may contest, compromise or otherwise settle claims in favor of or against the estate or trust. A creditor demands $80,000; the executor believes the claim is worth $50,000 and settles at that number. The statute authorizes the settlement. The executor still answers for the reasonableness of the compromise at the accounting, and a beneficiary who thinks the estate overpaid can object there. Certain settlements sit outside this power and need court approval regardless, most notably the compromise of a wrongful death action, which requires Surrogate’s Court approval under EPTL 5-4.6.

Powers to Pay, Distribute and Close Out

The remaining subdivisions of EPTL 11-1.1(b) authorize the fiduciary to pay funeral and administration expenses, pay taxes, distribute property in kind rather than selling everything to cash, and execute and deliver the deeds, releases and other instruments needed to carry out the administration.

Two related statutes interact with these powers. Before general distribution, the executor must set aside the exempt property that passes to the surviving spouse or minor children off the top of the estate under EPTL 5-3.1, the family exemption; the power to sell and distribute does not reach property the exemption statute has already carved out. And a trustee’s power to distribute principal is governed by the trust instrument and, where the instrument grants discretion, by EPTL 7-1.6, which controls invasion of trust principal. EPTL 11-1.1 supplies the mechanical power to transfer property; it does not expand a trustee’s discretion to decide who gets it.

What EPTL 11-1.1 Does Not Authorize

The omissions are as important as the grants. Acts missing from the statutory list require authority from the will, the trust instrument or the court.

Continuing the decedent’s business

An executor has no statutory power to keep running the decedent’s restaurant, contracting company or professional practice. Absent authority in the will, the executor must petition the Surrogate’s Court under SCPA 2108 for permission to continue the business. An executor who runs the business without authority is personally liable for losses, while profits belong to the estate.

Borrowing and mortgaging

The statute does not authorize a fiduciary to borrow money or place a mortgage on estate property. A fiduciary who needs financing must find the power in the instrument or obtain a court order.

Self-dealing

No subsection of EPTL 11-1.1 permits a fiduciary to sell estate property to himself, his spouse or his own business, even at fair market value. Self-dealing transactions are voidable at the beneficiaries’ election without proof of unfairness. The safe routes are unanimous informed consent of all interested parties or advance court approval.

Making gifts

The power to distribute means distributing to the people entitled under the will, the trust or the intestacy statute. It is not a power to be generous with other people’s inheritance.

Worked Examples

Sale of a residuary house. A decedent’s will leaves “all my property, real and personal, equally to my three children” and names one child as executor. The estate’s main asset is a house worth $600,000. Under EPTL 11-1.1(b)(5)(B), the executor may list the house, sign a contract of sale and deliver a deed signed “as Executor of the Estate of [decedent]” without any court order. The buyer’s title company will require a certificate of letters testamentary, usually dated within six months of closing. One sibling’s objection to the sale does not block it; the objecting sibling’s remedy is a proceeding in Surrogate’s Court, not a veto.

Sale of a specifically devised house. Same house, but the will devises it specifically to the eldest child. Now the power of sale does not apply. If the estate lacks liquid funds to pay a $90,000 estate tax bill, the executor must either obtain the devisee’s cooperation or bring an SCPA Article 19 proceeding to reach the property for tax payment.

Concentrated stock position. An estate holds $900,000 of a single employer’s stock, which is 85 percent of the estate’s value. The executor has the power to retain or sell under EPTL 11-1.1, but EPTL 11-2.3 requires a diversification analysis within a reasonable time. If the stock drops 40 percent while the executor does nothing for two years, beneficiaries can seek a surcharge measured by the loss attributable to the failure to diversify, roughly $306,000 on these numbers if diversification would have preserved the value.

Multiple Fiduciaries: Who Signs

When two fiduciaries serve, they must act jointly on discretionary matters; one co-executor cannot sign a deed alone. When three or more serve, EPTL 10-10.7 permits a majority to act, and a dissenting fiduciary who states the dissent in writing is protected from liability for the majority’s decision. Purely ministerial acts, such as depositing an estate check, can be done by one. Buyers, banks and brokers routinely require all fiduciaries’ signatures anyway, so co-fiduciaries in conflict often end up in Surrogate’s Court on a petition to compel or to remove.

Proving and Restricting the Powers in Surrogate’s Court

The statutory powers become usable only when the court issues letters. The sequence runs as follows.

1. Appointment. The nominated executor petitions for probate under SCPA 1401 (the will must satisfy the execution requirements of EPTL 3-2.1), or a distributee petitions for letters of administration under SCPA Article 10.
2. Letters issue. Letters testamentary or letters of administration are the fiduciary’s credential. A certificate of letters, obtainable from the court for a small fee, is what third parties rely on.
3. Restrictions, if any. The court may limit the letters under SCPA 702, for example “restraining the fiduciary from selling real property without further order of the court” or requiring funds to be deposited jointly with the fiduciary’s attorney. A restricted power in the letters overrides EPTL 11-1.1.
4. Preliminary letters. During a will contest, a preliminary executor appointed under SCPA 1412 can marshal and manage assets but is commonly restrained from distributing and often from selling real property.

Beneficiaries who believe a fiduciary is misusing the statutory powers have specific remedies: a proceeding under SCPA 2102 to compel the fiduciary to act or to supply information, a compulsory accounting under SCPA 2205, and a petition for suspension or removal under SCPA 711 and 719 for misconduct such as self-dealing or waste.

Timing Rules That Shape the Powers

Common Pitfalls

Is a Fiduciary Overstepping the Statute, or Are You Being Blocked From Using It?

For beneficiaries, we petition to compel accountings, unwind self-dealing transactions, and surcharge or remove fiduciaries who acted outside EPTL 11-1.1 or the will. For executors, administrators and trustees, we confirm which powers your letters actually grant, obtain SCPA 2108 or Article 19 authority when the statute does not cover the transaction, and defend your decisions at the accounting. To review the specific power in dispute before you sign or before you sue, call the Law Offices of Albert Goodwin at 212-233-1233 or email [email protected].