Can an executor sell an asset of the estate at a discount to a friend?

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Can an executor sell an asset of the estate at a discount to a friend?

I have 2 sisters who are the executors of my mother’s estate. Can they sell the house to one of their I friends for less than what has been offered on the house by someone else? Do I have any rights as an heir in this matter?

Asked on July 24, 2014 under Estate Planning, Texas

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 7 years ago | Contributor

An executor of an estate has what is known as a "fiduciary duty". That means that they must act at all times in good faith and conduct themselves in the best interests of the estate. Consequently, any type of self-dealing (and selling an estate asset at a discount to a friend would be included), is a breach of that duty. 

Accordingly, if a beneficiary believes that an executor has breached their fiduciary duty, they can bring the matter before the probate court. If the court determines that the fiduciary has failed in any one or more of their duties, it can order their removal and hold them personally liable for any harm done to the estate.

At this point, you should consullt with a local probate attorney for further advice.

 


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