A fiduciary – an executor, administrator, guardian, or trustee – holds a position of trust. Because the fiduciary acts for the benefit of others, he must account for the manner in which he handles the assets entrusted to him. Accordingly, a fiduciary has an obligation to account to the beneficiary, at reasonable times, for each item of the estate or trust that comes into his hands.
An action by the personal representative of an estate to settle his or her account is commenced by filing a complaint and the issuance of an order to show cause in the Chancery Division – Probate Part of the Superior Court. In all actions for the settlement of accounts, interested parties (including creditors, heirs, beneficiaries, etc.) then have the opportunity to serve the personal representative with written exceptions thereto.
Pursuant to the New Jersey Rules of Court, in all actions by a fiduciary for the settlement of accounts, other than plenary actions, any interested party may serve the accountant with written exceptions to any item in or omission from the account, including any exceptions to the commissions or attorney’s fees requested. It is essential that any such exceptions be filed in a timely fashion and drafted and executed in proper form.
The exceptions to the account must state particularly the item or omission excepted to, the modification sought in the account, and the reasons for the modification. By way of example, exemptions to an account may challenge a matter described in the inventory, charges or allowances requested, items improperly omitted from the account, depreciation in investments, the executor commission, or the requested counsel fees. Exceptions which are not stricken because of insufficiency in law must be adjudicated upon an evidentiary hearing unless no factual dispute exists.
Because estate administration, estate litigation, and Will contests require specialized knowledge, you may wish to consult with an experienced attorney if you have questions regarding a loved one’s or your own Last Will and Testament, your or your loved one’s Power of Attorney, suspicions of undue influence, the probate process, administration of an estate or trust, fiduciary obligations, preparation of a formal or informal accounting, refunding bonds and releases, and the procedures for filing a formal accounting / inventory or exceptions thereto. This article is for information purposes only, and is neither legal advice nor the creation of an attorney client relationship.
Justin M. Smigelsky, Esq. / Timothy J. Little, P.C. – 2017 – All Rights Reserved
Probate / Estate Practice Areas: Drafting of Wills and Trusts, appointment and removal of fiduciaries, probate procedures, intestacy, fiduciary duties and obligations, fiduciary accountings and exceptions, fiduciary compensation, marshaling of assets, actions to compel an inventory, insolvency petitions, will contests and disputes, caveats, the elective share, undue influence claims, Power of Attorney abuse and inter vivos gift disputes, ejectment and eviction from estate or trust property, Refunding Bonds and Releases, New Jersey Transfer Inheritance Tax (IT-R), New Jersey Estate Tax (IT-Estate)
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