Executors of wills take on a very responsible task. They fulfill the final will of the testators, in accordance with their meaning. In doing so, testators can give them many freedoms and set just as many limits. In their will, testators can also set other rules, for example, on the duration of the execution. For some aspects of asset succession planning, however, executors of wills are particularly suitable. For example, to support and protect minors or, at least according to the decedent’s understanding, heirs otherwise exempt from doing business – even from themselves. Executors of wills fulfill the role of an asset protector and sometimes even a mentor in matters of asset management.

1. Executors of Wills – Introduction

We live in a modern world. The times in which fairytale kingdoms existed and all acted according to the will of the ruling house, the word of the queen and king's law and that of princesses and princesses at least had considerable weight, seem strange to us today. But there is one aspect from these times that has persisted into our days, namely the regency.

Now you are probably wondering where a regency is relevant today. Except for the internationally known Prince Regent Mohammed bin Salman of Saudi Arabia, who has taken over the government of the Saudi monarchy for his father, hardly anyone should think of another current example here. So, in what other context should a regency be relevant to us?

Perhaps the tension would have remained high until the resolution of the question in this post had we left the answer out of the title and chapter heading. But yes, it is the executor. However, most executors of wills cover a rather limited area of responsibility. However, this can be quite comparable in scope to the role of a regent, if a testator so wishes.

Surprise: There is a second correct answer besides the previous one, namely foundation boards. They also practically manage assets that someone has left behind before. They are also bound by the will of the donor, but otherwise they basically only bear responsibility towards the donated property by protecting it and, if possible, increasing it further.

2. What does an executor do?

2.1. Enforcement of settlement

As the designation already indicates, an executor administers the estate of a testator. He thus ensures that the last will of the testator is enforced in his sense. First and foremost, this means, of course, that the inherited property is divided among the designated heirs as specified in the will. This is our classic understanding of the tasks of an executor of a will.

In fact, the tasks of executors of wills can go far beyond that. For example, an executor of a will can ensure before the division of the inheritance that any creditors are satisfied. Likewise, he can pay outstanding taxes out of the estate. Thus, it can also fall within his responsibility to pay funeral costs, to make a timely notification of the acquisition to the tax office, to file an inheritance tax declaration and to pay the inheritance tax. But also monitoring the fulfillment of legacies can be part of his tasks. All of this is known as settlement execution.

2.2. Permanent and administrative enforcement

To return to the keyword regency, the administration of the heir in the sense of the testator and for the benefit of the heirs can also be transferred to an executor of a will. However, a restriction of this activity is regularly part of the will. In this case, executors see wills as a transitional rather than a permanent solution. This is especially true if heirs are minors. Even if the heirs are already grown up, a testator can arrange for the administration of the inheritance. For example, one tries to ensure that the heirs do not expose the assets to risks, for example, spend it. So this can be seen as a kind of extended asset protection. However, testators can also have an interest in using an executor of a will in the case of heirs who are ill for a long time or even permanently. This ensures that the property is managed in faithful hands until the time when the heirs are able to deal with it independently.

However, all conditions for this and many other aspects must be precisely defined in the will. One then speaks of a permanent enforcement, in part also of an administrative enforcement. In addition, the duration of a permanent enforcement is legally limited to a maximum of 30 years (§ 2210 BGB). However, testators may also lay down other conditions of testament which either lead to the termination of the permanent execution or relieve the executor of his duties.

3. How do you become an executor?

This brings us to another important point. It shall affect the remuneration for this responsible task. There is no legal provision requiring compensation for enforcement. Thus, it is left to testators to regulate this in their will, if necessary.

Incidentally, executors of wills tax their income from this activity in accordance with the provisions of § 18 (1) no. 3 EStG. In tax terms, they are thus equal to freelancers.

4. What are executors allowed to do?

From what has been said so far, it should be clear that an executor of a will assumes a very high responsibility. Therefore, testators should be absolutely sure that they appoint an executor who they can fully trust even beyond the end of life. Finally, there is no longer any opportunity from the commencement of his activity to intervene in the action of the executor of the will. Neither by a probate court (except for gross breach of duty) nor by a family court, which would represent minor heirs. Only the will of the deceased is decisive.

However, this also means that executors of wills are usually not allowed to do business with themselves (§ 181 BGB). There are two exceptions. On the other hand, a testator in the will may allow transactions of the executor. On the other hand, an executor can have unrestricted access to the part of the inheritance that the decedent has left, bequeathed or owes him. Otherwise, an executor is obliged to preserve the property for the heirs as far as possible. Thus he may sell parts of the property, but an equivalent value must be acquired for it. Gifts are therefore excluded. Even debts can be incurred by an executor of a will, provided they are in the interest of the heirs.

5. Executors of Wills as Multitool – Conclusion

Many aspects can be listed in the will in order to regulate the activity of the executor in advance. He is then bound to them. And this should be taken into account if you want a permanent or administrative enforcement. Whether, for example, a remuneration comes into question and if so, in what amount, should be included in the will. But also very important is the time until which the enforcement should continue, or the circumstances that end it. And of course, one should also specify in detail what the executor of the will should consider in the division or administration of the property.

Equally important, however, is that one informs oneself in advance about the manifold possibilities, how one can have the transfer of assets by way of an inheritance by an executor of will. An executor of a will can perform a very wide range of tasks. The decedents have almost endless scope for design here. An executor of a will is thereby limited practically only by the powers and limits of the deceased within which he may act. Just like a regent. Only the king is denied him.