Can you face lawsuits for mismanaging an estate?

On Behalf of | Feb 23, 2022 | Estates

When someone appoints you as the executor or personal representative over his or her Indiana estate, you must take on many responsibilities on that party’s behalf. Serving as someone’s executor typically involves paying off debts and notifying creditors and beneficiaries, among other obligations. If you do not cover your bases, you expose yourself to potential liability.

According to CNBC, serving as someone executor or personal representative requires a high level of responsibility and organization. You may be able to ward off many potential lawsuits by exercising care and sound judgment. However, you still run the risk of facing a lawsuit related to the following.


You have a legal obligation to close the estate you oversee in accordance with state laws. If any of the estate’s beneficiaries believe you are trying to misrepresent the facts or illegally profit from it in some way, they may file a lawsuit against you alleging fraud.

Breach of fiduciary duty

You may also face a lawsuit filed by a beneficiary if he or she believes you breached your fiduciary duty in some way. Possible examples might include overpaying yourself for services rendered, misappropriating money or assets from the estate or selling assets for less than they are worth. Failing to leave enough time to sell the property at a reasonable price, stealing from the estate or otherwise acting in a manner that serves your own interests, rather than those of the beneficiaries, may also expose you to litigation.

Beneficiaries may not be able to hold you accountable for all issues arising from administering the estate. However, if your actions directly impact how much beneficiaries receive, they may look to hold you accountable.