A “fiduciary” is a person who owes a special duty of loyalty and good faith, fair dealing and the utmost in ethical character, to another individual or entity. In the context of estates and guardianships, a “fiduciary” is generic name for, and refers to, the person or entity that serves as executor, administrator, conservator, trustee, guardian of person, power of attorney, and other individuals in similar positions.
Fiduciaries, by definition, develop and set forth the course of action for the particular estate administration, probate process, trusteeship, or conservatorship, and are charged with the duty of following that course of action to a successful conclusion. Most importantly, fiduciaries are required to collect, protect and preserve the assets of the estate, trust or conservatorship, to evaluate the propriety of creditors’ claims, to pay such claims that are valid, to manage the assets in a manner that promotes protection and growth, and ultimately to distribute the assets to those entitled to receive them after the job is done. In the case of a Last Will and Testatment, the fiduciary (or executor), must transfer the assets to the intended beneficiaries upon conclusion of the estate’s business. In trusts, the trust document itself directs when and how the fiduciary (or trustee) is to manage and distribute the assets of the trust. In minor guardianships, the fiduciary (or conservator) must transfer the assets to the Ward when he or she reaches the age of eighteen (18), and in adult guardianships, the assets must be transferred to the estate representative after the death of the Ward.
Because fiduciaries manage assets, they must be trustworthy and dependable. They must also be credible, and have a proven track record for effective management of all types of assets, including liquid sums, stock and portfolio investments, real estate and personal property.
For years, select banks have advertised as fiduciaries, seeking to be named as executors and trustees of large estates. In more recent years, however, many banks have retreated from seeking fiduciary appointments for routine estates, and now a majority of banks in the business have minimum requirements before they will agree to serve a your fiduciary.
Besides banks, there are professional fiduciaries who serve as executors, administrators, trustees and conservators, like Mike Smith, partner at Andrew, Merritt, Reilly & Smith, L.L.P. Individuals like Mr. Smith are often chosen for multiple reasons. First, families often prefer someone with experience, who knows the legal and administrative issues related to estates, trusts and conservatorships. Such experience often reduces the overall costs to estate, trust or conservatorship, while at the same time speeding up the overall process. Second, a local individual is accessible, and someone you can actually meet with or talk to on the telephone, and who does not have “minimum dollar amount” requirements before they will serve. Last, often families feel that it is important to have an objective, third party to administer the families affairs. Unfortunately, money often times will cause friction in and amongst a family, and a third party fiduciary helps to avoid friction, feelings of favoritism, and the like.
The cost to hire of fiduciary varies, depending on whether you are dealing with a bank or a professional fiduciary. Typically, banks have published fee schedules fixing the fiduciary’s compensation. Professional fiduciaries occasionally have published fee schedules, but more often than not, are paid based on Georgia law, which provides a fee (also called a commission) of 2 ½% of all incoming monies, and 2 ½% of out-going monies. There are other minor commissions provided by Georgia law, but this is the prescribed fee under current Georgia law. Of note, whether your fiduciary is a family member or a professional fiduciary, the fee is the same. Accordingly, many people choose to have the experienced, neutral third party to serve, for efficiency, security, and ease of process. Last, when the professional fiduciary is a lawyer, the legal costs are generally reduced because of the familiarity the lawyer has with the particular matter based on his fiduciary service.
On behalf of the firm, Mike Smith and his staff have served as executor, administrator, trustee, guardian of property and conservator in over 1,500 cases, and maintains and administers approximately 120 active fiduciary cases on an on-going basis. Mr. Smith manages estates, trusts and conservatorships ranging from a few thousand dollars to several million dollars. The firm has a specially designed support staff designated for specific responsibilities and oversight on each file, and have long, established relationships with financial planners, accountants and other professionals for cost efficient consultation and representation on behalf of the estate, trust or conservatorship. Of course, absent conflicts of interest, the firm provides all of the legal representation where necessary.
Feel free to contact the Mike Smith about serving as your fiduciary. His vast experience as executor, administrator, trustee and conservator is unequalled amongst any other professional fiduciaries.
Andrew, Merritt, Reilly & Smith, L.L.P.
Seven Lumpkin Street
P.O. Box 1246
Lawrenceville, Georgia 30046
Phone (770) 513-1200
Fax (770) 513-1201