Changes to regulation of legal practitioner executors

On 15 October 2013, the Victorian Law Reform Commission’s report on succession laws was tabled in the Victorian Parliament by the Attorney-General, Robert Clark.

The report is the result of 18 months’ work by the Commission’s team, led by Commissioner Dr Ian Hardingham QC. The purpose of the review was to ensure that the laws of succession operate justly, fairly, and in accordance with community expectations.

The need for reform has long been recognised. In 1991, the Standing Committee of Attorneys General initiated a project to develop uniform succession law and practice across Australia. The Commission’s review was informed by the recommendations of the National Uniform Succession Laws Project.  

The report contains 78 recommendations for legislative reform, changes to court practices and new professional rules and guidelines. The Commission has also called for better public information about preparing wills, applying for probate and administering estates.

While most of the recommendations concern the administration and distribution of deceased estates, a number are directed to the legal profession. Of these, some require amendments to legislation, and others call for initiatives by the profession itself.

The Commission was asked to report in particular on ‘whether there should be special rules for legal practitioners who act as executors and also carry out legal work on behalf of the estate’. There are sound reasons why legal practitioners are appointed as executors and it is important to the community that they continue to provide this service. Nevertheless, the Commission was repeatedly told about a small but significant minority that takes unfair or unauthorised advantage of the position to reap generous amounts from estates in remuneration for this work.

Legal practitioners have no automatic right to charge commission for executorial services. They need to be authorised by the will or the beneficiaries, or they must apply to the Supreme Court. Cases such as Walker v D’Alessandro [2010] VSC 15 (15 February 2010) and Smulewicz v Recht [2011] VSC 368 (10 August 2011) have highlighted the importance of ensuring that the consent on which the legal practitioner relies is free and informed and that the estate is not charged both commission and professional fees for the same services. Complaints to the Legal Services Commissioner, and submissions to the Commission during the review, show that the problems these cases illustrate may not be widespread but are persistently experienced.

Rule 10.1 of the Professional Conduct and Practice Rules 2005 currently requires legal practitioners who draft wills that appoint them as executor to inform their client about the remuneration they would receive and the fact that a person who might not seek commission could be appointed. As complying with this Rule does not ensure that the client’s consent is obtained, the Commission recommended that it be revised.

More broadly, the Commission identified a need for the legal profession’s Conduct Rules to squarely address the conduct expected of legal practitioner executors and provide guidance on how to comply with their duties. It recommended new Conduct Rules, supported by guidelines for legal practitioner executors in meeting their fiduciary responsibilities.

In addition, the Commission recommended extending the reach of the Legal Profession Act 2004 (Vic), or the new uniform legislation for regulation of the profession, to the activities of legal practitioner executors. Proposed amendments would require costs disclosure to beneficiaries, empower the Legal Services Commissioner to resolve disputes between legal practitioners and beneficiaries, and reinstate the right of beneficiaries to seek review of legal costs by the Costs Court.

Of course, complaints about the amounts charged to estates by executors are not confined to circumstances where the executor is a legal practitioner, and the Commission has made recommendations with a broader application as well. It has recommended amending the Administration and Probate Act 1958 (Vic) to specify that a professional executor is unable to rely on a remuneration clause in a will unless, before signing the will, the will-maker gave their informed written consent to the inclusion of that clause. A further amendment would specify that an executor may receive commission with the fully informed consent of all interested beneficiaries.
The Commission was also asked to report on ‘whether a court should have the power to review and vary costs and commission charged by executors’. There was general support for the idea within the legal profession, though differences in view about the scope of the court’s power. The NSW Supreme Court has such a power, which has rarely been used but is seen as having a strong deterrent effect in that jurisdiction, and the Commission recommended that Victoria adopt similar power, based on section 86A of the Probate and Administration Act 1898 (NSW).

The report, including all the recommendations, can be accessed at

Date published: 
16 May 2014

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