Administration: Grants of representation

Question 1

REMINDER BECAUSE I ALWAYS FORGET IT

Answer 1

If a trust arises under a will, 2 trustees are needed. If minor has vested interest can give to parents as they can give valid receipt (among other options)

Question 2

What is a grant of representation?

Answer 2

Court order confirming authority of those named in it to administer the estate

Question 3

What are the 3 types of grant?

Answer 3

1. Grant of probate
2. Grant of letters of administration (with will)
3. Grant of letters of administration

Question 4

What does the grant confirm?

Answer 4

• Identity and date of death of deceased
• Deceased left valid will
• Identity of executors appointed
• Value of estate to which grant applies (succession estate)

Official signature + stamp +holographic seal added

Question 5

When will a grant not be needed?

Answer 5

If estate contains only assets not requiring a grant

Question 6

From when does the succession estate legally vest in the hands of the executor and administrator?

Answer 6

• Executor = from death
• Administrator = when appointment confirmed by grant

Authority only extends to succession estate!

Question 7

How will PRs provide evidence of their appointment when complying with duties to administer estate?

Answer 7

Grant of representation (provides proof of PR’s authority to act)

Question 8

When is a grant of probate appropriate?

Answer 8

• Deceased left valid will
• Will appoints executors and at least one is going to act

Issued in names of those executors who apply

Question 9

If will only disposes of some of deceased’s property (i.e. partially intestate), is a grant of probate still required?

E.g. whole/part of estate left to pre-deceased family member by will and no substitution provisions apply

Answer 9

Yes

Question 10

What does it mean if the appointment of an executor under will is limited? How is this reflected?

Answer 10

• Means authority only extends to specific assets, jurisdiction or time
• Will be reflected in authority conferred by grant

Question 11

Can someone named in a will give the right to take out a grant to someone else?

Answer 11

No - but can formally appoint someone to act on their behalf under power of attorney

Question 12

When is a grant of letter of administration (with will) appropriate?

Answer 12

• Deceased left valid will
• Appoints no executors who are willing/able to act

Rule 20 applies - entitled to apply for grant in order of priority

Same as grant of probate re correct grant even if it does not dispose of all estate (i.e. partially intestate)

Question 13

When must at least 2 administrators be appointed under a grant of letters of administration (with will) or grant of letters of administration?

Answer 13

If there is a life or minor interest

Question 14

When is a grant of letters of administration appropriate?

Answer 14

Deceased died intestate (no will or invalid will)

Rule 22 applies - entitlement derives from relationship to deceased and right to share of estate under intestacy

Question 15

For what assets (in succession estate) is no grant required for PRs to deal with?

Answer 15

• Assets that can be distributed under Administration of Estates (Small Payments Act) 1965
• Personal household possessions and cash

Question 16

Orders made under Administration of Estates (Small Payments Act) 1965 permit what to be paid to whom?

Answer 16

• Permit a restricted category of assets (national savings [bank accounts, premium bonds, savings certificates]; Friendly, Industrial and Provident Society deposit accounts; arrears of salary and wages; pensions where deceased was public service; building society accounts)…
• …to be paid to persons who appear to be beneficially entitled to assets without formal proof of title

Question 17

What is the upper financial limit of payments made under Administration of Estates (Small Payments Act) 1965? What happens if value of asset is grater?

Answer 17

• £5,000 per asset
• If greater = grant required to establish title to whole sum (not just that in excess of £5,000)

Example: A will includes:
Building society account worth £60,000

• Grant required as value greater than statutory limit under Act

Premium bonds worth £2,000

• Grant not required

High street bank current account worth £10,000

• Technically not subject to Small Payments Act but bank may agree to close account without sight of grant

Question 18

Does the Administration of Estates (Small Payments Act) 1965 make relevant payments obligatory for those holding assets?

Answer 18

No - only permissible

Does not compel them to pay

Question 19

Why are the provisions of Administration of Estates (Small Payments Act) 1965 rarely required?

Answer 19

Most banks/financial institutions adopt own policy and release sums (commonly up to £15k) without sight of grant permitted evidential requirements are complied with to close account and show that recipient entitled to money (death certificate, will, confirmation of entitlement under intestacy)

PRs may also be expected to sign undertaking confirming right to administer and give indemnity to bank in event payment made to wrong person

Question 20

Why are PRs able to dispose of chattles without having to produce formal proof of their authority? What is the exception to this? And what should they check before doing so?

Answer 20

• Title to personal household possessions passes by delivery and proof of ownership not required when they are sold
• Exception: cars (reg docs needed), joint property (would need consent from joint owner)
• Should check whether any items gifted specifically by will before selling items

Question 21

What cash can a PR take possession of with no grant?

Answer 21

Cash found at deceased’s home

Question 22

What is not needed for assets passing outide of succession estate to be released? What is needed?

Answer 22

• Grant not needed for release
• Death certificate and any other documentation required by asset holder needed

Question 23

Recall the items passing outside of succession estate - what is the process for dealing with them?

Answer 23

• Property owned as joint tenants - property passes automatically on death; land reg/bank transfers title into name of surviving owner
• DMCs - deceased transferred ownership/control to B in lifetime
• Life policies written in trust, discretionary pension lump sums nom for TP - funds payable to named B on production of death certificate
• Assets held in trust in which deceased had interest - T should be notified of death and trust deed determines what happens

Question 24

What are the advantages to having assets in estate that can be administered without a grant?

Answer 24

• Releases money to Bs without waiting for grant/administration to be completed
• Provides source of funds to meet expenses inc IHT
• Cost-effective way to carry out administration of small estate/estate comprising only assets which do not require grant

NB unless an estate comprises only assets where a grant is not required the PRs will need to obtain a grant of representation
Once a grant is required, it is usually simpler to administer the whole estate with reference to the grant rather than try and administer some assets without it (even if in principle that might be possible)