When can you appoint a liquidator for an estate?
In the event of an inheritance, it sometimes occurs that a third party – a creditor or other stakeholder, for example – wishes to have a liquidator be appointed. That third party can submit a petition to the court, but this is granted only if certain conditions are met. Contract law attorney Robert van Ewijk explains how this works.
Request for the appointment of an estate liquidator
Generally, an estate is settled by the heirs. They ensure that creditors are paid and then share in any positive balance or remaining items jointly after that. A third party can make a request for an external liquidator . Dutch law (article 4:203, paragraph 1 of the Civil Code) states the circumstances under which the court can designate a liquidator. In this blog, I discuss only the situation in which the party charged with the management of the estate (i.e. the heirs or an executor) is either unsuitable to do so or evinces serious shortcomings in the compliance with his obligations. But that condition is not easily met.
Serious shortcomings in managing the estate
The executor’s shortcoming in fulfilling his task of managing the estate must be of a serious nature in order to constitute grounds for the appointment of a liquidator. The party wishing to have a liquidator appointed must claim and must prove that such a situation exists. Consider, for example, a situation in which the executor of an estate “borrows” money from the estate, removes goods from the estate or places creditors or other stakeholders at a disadvantage in some other way.
What happens after a request for the appointment of a liquidator?
Once a petition for the appointment of a liquidator is submitted to the court, the court then calls the petitioner, the heirs, the estate agent and the executor (if these parties exist) to appear. They can make counterclaims against the petition and provide their points of view. Once this has been done, the court will make a decision about the appointment of a liquidator.
What are a liquidator’s tasks?
If the court appoints a liquidator, then this party acts in place of the heirs and/or executor of the estate. The liquidator then has exclusive authority over the estate. When monetising the assets in the estate, he must be in contact with the heirs as much as possible. The liquidator is entitled to payment, which must be paid from the estate.
Inheritance law attorney at AMS Advocaten
If you are a stakeholder in the settlement of a state and believe that a liquidator should be appointed, then please contact the inheritance law attorney at AMS Advocaten. He can advise you as to whether it makes sense to submit a petition for the appointment of a liquidator.