If a PR fails in their responsibilities, the beneficiaries and any other PRs can take steps to have them removed, for instance, if they are not properly administering the estate or failing to account for the administration, or there is a conflict between PRs.
The ruling in The Estate of Veronica Cadogan deceased  EWHC 1577 is particularly useful for its discussion on the legal responsibilities of the PRs of an estate and the risks of incurring personal liability. The case recently concluded with a former administrator of the estate being ordered to pay around £1.7m to the estate.
The Cadogan estate
Practitioners may be familiar with the background to what was a long-running, nine-year litigation. Kirsty Cadogan and her brother, Kevin, were the administrators of their late mother’s estate - a complex and high value estate that included a number of properties.
Their mother left a will but no grant of probate had been taken out, and Kirsty and Kevin obtained letters of administration with will annexed in April 2013.
However, disputes arose between the two administrators and other individuals. In 2016 Kevin and Kirsty issued claims against each other for ‘wilful default’ in respect of their dealings during the estate administration.
Wilful default “seems to require nothing more than that the representative has fallen below the standards to be expected of a reasonably competent representative…” (Williams, Mortimer & Sunnucks: Executors, Administrators and Probate (21st ed) as quoted by JJ Judge Klein).
In April 2017, the court removed Kirsty and Kevin as administrator and appointed Mills & Reeve Trust Corporation Ltd as professional administrator in their place.
Kirsty’s contention was that a family business run by Kevin had used some of the properties in the estate without paying occupation rent, accounting for profits made or accounting for rent from other properties. He admitted failing to collect rent for the estate for the business’s occupation of the properties but said he had given credit for sums due. Kevin counter-claimed against Kirsty for alleged failure to collect rent or obtain possession of properties.
Kirsty won her claim and the High Court has now ordered Kevin to account to the estate to the tune of £1.7m. HH Klein quoted Williams thus: “A representative must duly administer and distribute the estate of the deceased. For these purposes, he owes duties to preserve the assets, to deal properly with them, and to apply them in the due course of administration for the benefit of those interested according to that course. A representative who breaches any of these duties is guilty of a devastavit and may be personally liable to make good the loss caused to the estate…”
He also stated that a reasonably competent administrator controlling the properties in issue, “which are effectively income-generating properties, would have obtained income (by way of rent or other occupation fee) for the benefit of Mrs Cadogan’s estate. I am satisfied that Kevin has failed to do this and so is liable to account to the estate for that failure on the footing of wilful default”.
He went on to say that considering the sums which may have been generated by those properties for the benefit of the estate, Kevin’s failure was significant. His failures arguably tantamount to negligence and maladministration.
While this was a complex and high-value estate, it is a good reminder of the risks inherent in acting as a personal representative, and the consequences of failing to comply with their duties.