Corporate executor-nominate not entitled to appoint an attorney rules sheriff



A corporate executor is not entitled to appoint an attorney, a sheriff has ruled, as the “fiduciary duties of an executor-nominate are personal to the holder of the office”.

Sheriff John McCormick at Glasgow held that it was not competent for an executor-nominate which is a company - in this case a bank - to appoint an attorney.

He said the law was “well settled” and that “no authority” was provided to support a departure from “longstanding and accepted practice,” which is that neither an individual nor a corporate executor is entitled to appoint an attorney to carry out the fiduciary duties of an executor nominate.

The sheriff gave his judgment in an application relating to the estate of an individual referred to as “KFC”, who had appointed The Royal Bank of Scotland plc and his wife as his executors.

The bank had granted a power of attorney in favour of five named partners of Brodies LLP, one of whom had signed the application for confirmation.

On behalf of the bank it was submitted that at common law a company can appoint an attorney to carry out its functions, including executing documents, on the company’s behalf.

The power of attorney had been intended to provide only for the “administrative function” of executing deeds, including the declaration on the application for confirmation, though it was accepted that the wording of the power of attorney “went much further”.

It was also accepted that the bank had not, until recently, sought to use a power of attorney when fulfilling the office of executor, and that the intention had been to regularise agency arrangements between the bank and the solicitor - the implication being that it was “administratively convenient” for the bank.

However, the sheriff said the submissions “lacked depth”.

Delivering his judgment, Sheriff McCormick said: “The sole reference to an executor having the power to appoint an attorney in relevant legislation occurs in the context of an executor residing abroad who may appoint someone in Scotland as his attorney. Aside from that exception, parliament has not provided for an executor appointing an attorney and I see no reason to extend that exception.  On the contrary, there are sound public policy reasons for not doing so.

“The executor, corporate or otherwise, should execute and accept responsibility for the declaration on the application for confirmation.  It is the executor who seeks to be confirmed in that office. To permit an executor to exercise his, her or its powers by way of an attorney (save in the exception of an executor resident abroad) would be open to abuse.

“The fiduciary duties of an executor-nominate are personal to the holder of that office. Those fiduciary duties include applying to be confirmed on the entire known estate of the deceased, settling liabilities and distributing the estate in accordance with the will. Civil liability may lie with an executor.

“It is in the public interest that an individual or a company, having accepted office as executor, does not distance himself, herself or itself from the fiduciary responsibilities incumbent upon an executor. This applies, irrespective of whether, as here, the executor is entitled to charge a fee.”

He added: “No authority was provided to support a departure from longstanding and accepted practice. No colourable reason was provided, other than an unspecified convenience to the bank. If the administration of such estates is inconvenient, the option is to decline or to resign office as executor-nominate.”

Accordingly, the sheriff refused to grant warrant to issue confirmation on a declaration signed by the attorney.

Before closing, Sheriff McCormick also mentioned “three matters of concern”. The first involved the bank’s approach towards the court.

He said: “The law and procedure is clear, well settled and is not seriously in dispute.  The process of applying for confirmation is routine and well understood by the bank.  Had the bank wished to adopt a different approach, the proper course would have been to draw this to the sheriff clerk’s attention and seek a hearing before the Sheriff, rather than wait for a vigilant sheriff clerk to notice.”

The second demonstrated what the sheriff described as “the perils of the approach” suggested by the bank, the court having received a second application for confirmation also purporting to use a power of attorney, by a different Scottish bank.

He explained: “The deceased had been resident in Scotland. The power of attorney was executed in Scotland. It contains similar wide powers. It purports to appoint as its attorney an unspecified number of unnamed employees of a separate bank, having its registered office in London. The deed states that it shall be governed by English law. It has been returned.”

He also addressed the suggestion that to certain executors the fiduciary duties accompanying that office were an “administrative inconvenience occurring between death and fees”.

“If that is the case, such an approach is to be deprecated,” the sheriff said.