740 - Passings of Accounts as a Strategic Tool Beyond Retrospective Approval

·11 min·1 clip

Jonathan Cappi and Osama Salimi reveal how passing of accounts can be used as a strategic tool for future actions.

The episode begins with hosts Jonathan Cappi and Osama Salimi introducing the topic of passing of accounts as a strategic tool. They clarify that passing of accounts is traditionally a court-supervised retrospective review of a fiduciary's administration during a defined accounting period. The hosts explain that this process results in court approval for past conduct, often fixing compensation if not provided in the will. They then pivot to creative uses, suggesting that passing of accounts can be employed to get approval for future actions like interim distributions or encroachments. This is done by attaching proposed statements of distribution to the affidavit of verification during the passing process. The hosts discuss how this approach can bind beneficiaries if included in a consent judgment, providing assurance before taking action. They highlight scenarios where this is particularly useful, such as when beneficiaries cannot give proper consent or when there is potential resistance from capital gift-over beneficiaries. Limitations are noted, including that courts will not rule on objections to future discretion exercises and will only assess authority, not method. The episode concludes with a reminder of the importance of transparency and circulating ideas among beneficiaries, even outside formal proceedings.

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