Understanding the Probate Service

“Probate”is the word commonly used for the administration of a deceased’s Estate. It actually means the name of the legal document that is produced by the High Court if the deceased left a valid Will with surviving Executors.

There are several ‘Grants’ that can be issued, but the most popular are the Grant of Probate and the Grant of Letters of Administration, for when someone dies “intestate” (without a Will).

Role of Administrator or Executor

Simply, it is the responsibility of the Executor or Administrator to deal with all aspects of the administration of the deceased’s Estate. In practice, many Executors and Administrators ask a solicitor to do this for them, due to the sizeable amount of paperwork that is generated.

Solicitors can be appointed as Executors and this is usual where you wish to ensure that a particular firm carries out the administration of the Estate for you, especially where there is a house involved.

The solicitor holding the Will should be approached as soon as possible after death in order that they can make the necessary arrangements for the administration of the Estate. If there is a Will and it is held by a solicitor you must inform that solicitor of the death as soon as possible.

A list of assets and liabilities will be compiled. If necessary, assets will be professionally valued. Once the values of the assets and liabilities have been obtained, the necessary Inland Revenue forms will be completed, a formal Oath will be sworn and the application made for the appropriate Grant .

The assets of an Estate cannot be encashed, or a house sold, until the Grant has been issued. Even when the entire Estate has been liquidated, it is not always a good idea to distribute it amongst the beneficiaries. There are two specific deadlines that have to be considered – one for creditors of the estate and another for potential beneficiaries to make a claim. 

Also, an Executor or Administrator is not legally obliged to distribute an Estate until one year has elapsed from the date of death. Most non-professional Executives do not know this, and will make payments from an Estate without being aware of the personal liability they may have. Administrating an Estate can be a complex and time-consuming task. 

Asking a solicitor to act on your behalf is not an admission of defeat – it is extremely sensible! A good solicitor will keep you involved in the process, and provide you with regular updates. You should always use a solicitor who is experienced in dealing with Estates, preferably one who is a member of the Society of Trusts and Estates Practitioners (STEP), a prestigious organisation for those who are specialists in the areas of Wills, Trusts and Estates.

Probate Advice

Funeral Planner have linked up with TWP LLP and offer probare services.

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You Can't Take It With You: Episode 5

How do you decide to leave your business to the family?

Hans and Anna have six children, five sons live in the UK and one daughter lives in New Zealand, Their family Garden Centre business has been recently valued at £4 Million and is based in two locations. Three of the sons are currently involved in the business whilst the other two run their own operations.

Nev and Alan have two children, a son and a daughter. Their family Land Management business has a recent price tag of £3 Million. Their son works in the business and their daughter who lives 100 miles away is a school teacher.

Hans and Anna are both getting on and have reached their 80's and a decision is rather urgent but they just can't decide. The indecision is now hurting the business as it is now drifting and certain sections are losing money. The three sons who work in the business offer no true leadership skills and have offered loyalty, hard work but little else.

Gerry sets out to meet the rest of the children in the UK.

Nev and Alan's children have very clear opinions on what to do with their inheritance. Damian wants the business to go into a trust which will allow him to grow it for future generations. The daugher Vashti wants her share and feels placing the estate into a trust shows a last of respect to her.

Nev and Alan want complete fairness but also don't want to put the business at risk so they feel placing the business in a trust is the best solution.

Gerry arranges for the meeting with Sue Medder to offer advice to both couples.

Hans and Anna agree that the estate should be placed in equal shares  for the children but cannot decide who will be Managing Director amongst the sons. They are sent away to make a decision about the MD role. Gerry points out that the decision of MD should be immediate to secure the current business status and allow the business to flourish.

Nev and Alan have their meeting and still feel a trust is the best solution though this is clearly unfair on their daughter.

Gerry arranges for the family debates over dinner with Hans and Anna sitting with their five sons to discuss options. The boys generally disagree until Antony, a middle son, shows his hand and says he is happy to move from his existing business and take control, Antony throughout the show has demonstrated the most business sense and he is also the diplomat.His offers does go down well with his other siblings and parents.

During the Nev and Alan family debate Damian says very little as I suspect he feels he is in the box seat. However Vashti makes it very clear that the decision to put the estate in a Trust is unfair and it certainly shows how controlling their parents will remain even after their death. She challenges her Mother about having a similar role to her in the family business which certainly struct a nerve and challenged her current position in respect of the Will. Alan said very little other than it should be 50/50 but it is clear that the parents were closer to Damian. Vashti tells them she does not want an inheritance she cannot spend. This clearly affects her Mum, Nev.

The final meetings arec arranged with Sue Medder and Gerry.

Hans and Anna have acted quickly and installed Antony as MD and the business is now in better hands. They split the business into six equal shares and state that Antony will remain as MD after they die.

Nev and Alan arrive and Nev does the talking and initially says she wants it in a Trust but with no rules attached. This is discussed but Sue highlights that no clarity will exist and it would end in dispute. Gerry adds that this would be a very uncomfortable position for both children.

Nev suddenly changes her mind and decides it should be a direct split 50/50 and no Trust. Alan nods in agreement.

Before Nev changes her mind again the Wills are produced and they both sign.

My gut feeling says this is not the final outcome and these Wills may change again one day.

This episode wants again highlights estate issues and how difficult the decisions can be without communication.

How many other business owners are in the same position and don't make a decision leaving behind a real mess.

Next week's final episode will highlight issues within families when certain siblings are disabled or need extra support and attention.

Tune into BBC2 on Friday for the last episode.

You can't take it with you, but you can ensure who has it

An increasing number of people are needing more complicated Wills, in line with those currently being featured in the BBC 2 programme 'Can’t Take it With You', says Francis Durrant of Barr Ellison Solicitors in Cambridge, making it all the more worrying that 70% of people die without making a Will. 

 

“People wanting to leave money to charity or to leave uneven amounts to different relatives and people who are delaying writing a Will because they undecided how to divide their estate are some of the issues featured in the programme and we ourselves are seeing an increasing number where the Will is not straight forward.

Whatever people have to leave it’s important that they write a Will to ensure their estate is left with the people they want to leave it to and they don’t pay any unnecessary tax.”

Reasons why people are increasingly having more complicated Wills include the increase in couples cohabiting rather than marrying, more complicated trust provisions and more people having second marriages. “It is particularly important for unmarried couples to make Wills because they do not have the protections you automatically receive as a married couple,” says Francis. “Also trust provisions can be put in place that can actually end up saving tax and second or subsequent marriages obviously make Wills a lot more complicated.

People are also concerned about the possible remarriage of a survivor and how that would affect what they leave to loved ones. And even if people believe they have very straight forward requirements, with people living much longer they need to think about protecting funds against the increasing cost of long term care.”

Francis believes that it is often the fact that a Will is likely to be complicated that puts people off taking the plunge: “If people are worried about who should receive what or how they should go about it they should remember that any difficult decisions they have to make are likely to be far easier than leaving family with the stress of them dying intestate.”

 

It’s also important, he says, to remember to keep a Will updated to take into account any changes in beneficiaries’ needs and a person’s financial and personal circumstances. 

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You Can't Take It With You: Episode 3

The third episode shown at 9.00pm last Friday evening. The theme: fairness amongst the siblings.

Sir Gerry Robinson turns his attention towards two families who have to decide how to split their estate fairly and avoid major issues amongst the siblings.

The first family is from Kent who have built a large dairy farm which is currently valued at £4 Million. Raymond wants to leave the farm to his three sons who all worked there and leave out his daughter who is currently at University and has no plans to work on the farm in the future. His wife Jane thinks this is entirely unfair and they seek advice from senior lawyer Sue Medder who provides a number of options for the couple.

The second family are devout Muslims and want to follow the teachings from the Koran. The Koran states that boys should be left twice as much as their sisters but certain conditions are attached.

Khalid and Sara face a dilemma in writing their Will. Do they remain true to their faith which is clearly unfair in modern Britain or do they share their estate equally.

Raymond and Jane discuss the Will options with their children. Sir Gerry probes the individuals to determine their views which in most respects is rather selfish. All the sons are happy to cut their sister from the farm and business. One son also wants to stop his sister receiving one of the family properties which was a compromise suggested by their Mother.

The family debate saw all the son's state their opinion which really upset their sister and shocked their Mother.

Raymond showed little emotion throughout the discussion and sent out mixed messages. His main priority was to ensure the farm continued as a business for his sons and felt that was only possible by cutting out his daughter.

Sue Medder presented an option where the business is split into shares and the shares are allocated in the Will. This option allows all four children to benefit from the business with the share proportions decided by both Raymond and Jane. The other options included leaving the business to one son or the three sons.

Khalid and Sara from Cheshire seek advice from specialists in Muslim law and have a discussion whch also involved friends who have similar issues. The advice received from the Muslim hierarchy was inflexible and pressurised the couple to follow Sharia law which would mean leaving Sara only 1/8th of the estate and the remaining estate to be shared with his own family and stated that their son receives twice as much as his sisters. Khalid and Sara believed this was fundamentally unfair in their eyes and they seeked further advice from members of their community. A leading Muslim academic had a different view and suggested the estate could be spread evenly if the son decided not to support his sisters for the rest of their lives.

The decision had to be made and Raymond and Jane decided to follow the share option with a 32%, 29%, 29% and 10% split for the business, also giving one of the properties to their daughter and splitting the remaining properties amongst their sons. Jane was very happy with this but it was clear Raymond has been pressurised and didn't really like the option. If Jane was to go first there may be changes!!

Khalid and Sara followed the second piece of advice they received and shared the estate equally but allow the option for the son to take twice as much if he committed to support his sisters. They also decided that the family home would stay with the surviving spouse and would then pass on to the children after the death of surviving spouse. This conclusion was progressive for Khalid and Sara and represented an understanding of modern day life in Britain which expects a fair split on the estate.

Once again the key point of this show is that a Will must be discussed and prepared before death as ignoring the decision will create major issues for all the surviving family members and could tear families apart.

Next week the issue moves to child care and who will take care of your children before they reach the age of 18 if both parents die. This looks like another important subject especially in modern times when families are often been affected by divorce and separation.




 

You Can't Take It With You: Episode 2

The second show in the series introduced us to more couples torn over what to do with their estate once they move on.

The theme this week was to focus on favouritism and how that impacts on families after the Will is read and how it can cause real heartache.

The first family have five daughters, their parents, Robert and Brenda, could not agree on a will because Brenda wanted to leave more of their estate to the youngest and Robert disagreed and wanted it all to be split evenly.

The second family had to deal with an earlier unfair Will which benefited one son more than a daughter; Trevor getting 80 per cent, while his half-sister Pam was left with less than 20%.

He now has to decide how much he should leave to Pam's three children to redress the balance from his half of the estate once he pops his clogs.

Robert and Brenda with the help of Sir Gerry held a family meeting to discuss their concerns which highlighted the difference of opinion. The youngest daughter felt the meeting too emotional and briefly left in tears. The four elder sisters recognised they had received benefits the youngest daughter had yet to receive and they agreed she should benefit by receiving an payment of £35,000 before the estate was split evenly.

This left one final issue. Which daughter would receive their Father's Police Gallantry Medal and Robert finally made a difficult decision which actually met with his wive's approval.

In the second dispute Trevor found the family meeting very difficult and couldn't really discuss the matter though Sir Gerry wouldn't let it go and hustled for a view. This discussion must have suffered from a few long silences as it was edited to a short interchange amongst the family members.

Trevor seemed to have no time for his half sister and favoured only her eldest daughter who could trust with a proportion of his estate. He actually said he trusted his step children with all of his estate but following much discussion, and a little outrage, did he come to his senses.

The second family decided to place one half of the estate in trust for the niece and two step daughters, dependent on her died first, and leave the other half to their spouse. This allowed the surviving spouse to remain in the family home for as long as they wished.

There was a sad footnote as Brenda from the first family had died since filming but at least she died with a valid Will in place and happy that the issue of the estate was settled.

Next week's programme will focus on how tradition and religion can create unfair Wills.

Can't wait.