Administration of Estates

Question 1

What is the deadline for IHT?

Answer 1

The deadline for submitting the account is:

12 months from the end of the month in which the death occurred. If the deceased died on 15 March the IHT account would need to be submitted by 31 March the following year.

The deadline for paying IHT due is:

6 months from the end of the month in which death occurred, after which interest becomes payable on the unpaid tax. If the deceased died on 15 March the IHT should be paid by 30 September.

In practice the PRs will submit the account and pay the IHT due as soon as possible because the grant will not be issued until information about the estate has been provided to HMRC and any IHT has been paid; the PRs need the grant to carry out the administration payment of interest on unpaid IHT should be avoided.

Under ss. 227-228 IHTA the IHT due in respect of certain assets may be paid by 10 equal annual instalments.

IHT payable in respect of property that does not qualify should be paid in full by the usual deadline. Instalment option exists to prevent undue hardship on the taxpayer.

Question 2

What categories of estate do no have to complete an IHT400?

Answer 2

Low Value Excepted Estate and Exempt Excepted Estate

Question 3

What is the definition of a low value excepted estate?

Answer 3

A low value excepted estate is one where there is:

no IHT payable, and the reason for this is because

the gross value of the estate is below the NRB.

The gross value for these purposes is the total taxable estate figure plus the value of certain ‘specified transfers’ plus the value of ‘specified exempt transfers’.

Specified transfers include chargeable transfers made in the 7 years before death comprising cash, chattels, shares or land.

Specified exempt transfers include exempt gifts to spouses/civil partners and charities.

The NRB considered here is:

· The current NRB amount and any transferable NRB available from their spouse.

· The residence NRB is not considered, and if claimed, the estate cannot be excepted.

Question 4

What is the definition of an exempt excepted estate?

Answer 4

• the gross value of the estate is no more than £3 million, but
• no IHT is payable, and the reason for this is because
• after debts are deducted and spouse and/or charity exemption are applied the net value of the estate is below the NRB.(N.B. debts alone cannot bring the estate into exempt excepted status).

The meaning of gross value and NRB are the same as for the low value excepted estate.

Only spouse or charity exemption can be considered for these purposes – no other reliefs can be taken into account.

Question 5

Exceptions to the excepted estate rules

Answer 5

The deceased made a gift with reservation of benefit that subsists at death (or the reservation ended in the 7 years prior to death and the transfer was not exempt)

The estate includes either more than one trust interest, or, a single trust interest worth more than £250,000 (and is not passing to spouse)

Foreign assets are worth more than £100,000

The value of specified transfers exceeds £250,000

A claim for the RNRB is being made (the claim for RNRB - IHT 435/6 - would accompany the IHT 400).

Question 6

What is an IHT421?

Answer 6

An IHT 421 (the probate summary) should also be completed. It contains details about the deceased and a summary of the gross/ net succession estate (assets passing under the grant rather than the IHT estate).

Question 7

What is a C4?

Answer 7

The C4 is used to inform HMRC about:

additional assets/ liabilities discovered after the IHT 400 was submitted

corrections to the value of assets/liabilities originally included in the IHT400

changes to exemptions/reliefs applied – e.g. an increase or decrease in value or where these were not claimed or not due

a variation of the original beneficiary entitlements which affect the IHT liability e.g. changes in the value of what an exempt beneficiary receives

If the PRs complete a C4 they will also make an adjustment to the calculation of IHT as the liability has either increased or decreased.

If new assets are discovered, the original value of an asset was too low (or a liability too high), or reliefs were mistakenly claimed - the total value of the taxable estate will increase. The PRs should pay the additional IHT due when sending HMRC the C4.

If new liabilities are discovered, the original value of an asset was too high (or liability too low), or reliefs due were not claimed - the total value of the taxable estate will decrease. The PRs will claim a refund of IHT already paid.

Question 8

How do PRs raise funds to pay IHT?

Answer 8

Direct Payment Scheme

Banks or building societies may not be able to release funds to the PRs prior to the issue of the grant but they can be asked to make a direct payment from the deceased’s account(s) to HMRC by telegraphic transfer under the Direct Payment Scheme.

PRs must complete schedule IHT 423.

Borrowing

From a beneficiary (often interest free). The main beneficiary of the estate will often fund the payment of IHT using funds outside of the succession estate/ for which the grant is not required e.g. money held in a joint bank account which passed by survivorship, or the proceeds of a life policy written in trust.

From a bank, where commercial rates of interest will apply.

Question 9

What is the difference between an administrator and an executor?

Answer 9

A PR appointed by a person’s will is called an executor

A PR appointed by operation of statute is called an administrator.

Question 10

What is the grant of representation?

Answer 10

The grant is an order of the High Court. It is necessary because it establishes the:

• authority of the PRs to act (in particular, their right to collect assets and distribute the estate); and
• validity of the deceased’s will, or, that the deceased died intestate.

The PRs will not usually be able to collect or realise assets in the estate without producing the appropriate grant.

Question 11

What does a PR do?

Answer 11

This involves collecting in the deceased’s assets, ensuring the deceased’s debts are paid, meeting tax liabilities and other estate expenses and then distributing the assets to the beneficiaries who are entitled (either under a will or intestacy).

The role of a PR is fiduciary in nature. All duties of a PR must be performed in accordance with their duty of care. What amounts to ‘due diligence’ will depend upon the circumstances and complexity of the estate.

To act as a PR a person must be appointed either by the deceased’s will or by operation of statutory rules – the Non-Contentious Probate Rules 1987 (‘NCPR’).

Question 12

How might solicitors be involved with the administration of an estate?

Answer 12

The solicitor has been instructed by the PRs for advice on the administration.

The solicitor has been appointed as executor under the deceased’s will.

The solicitor has been instructed to act on behalf of a party to a contentious probate matter.

Question 13

What duties does the PR have before the issue of the grant?

Answer 13

• Common law duty to dispose of the deceased’s body (Williams v Williams). This is usually arranged by surviving family members and will have already taken place before a solicitor becomes involved.
• Statutory duty to provide information about the estate to HMRC and pay inheritance tax (IHT) due (Ss 216 and 226 Inheritance Tax Act 1984 (‘IHTA’)). A grant will not be issued unless information required to be reported to HMRC has been delivered and any IHT due has been paid.

Question 14

What duties does the PR have once the grant is issued?

Answer 14

Duty to inform HMRC and pay IHT

• Collect and get in the real and personal estate of the deceased and administer it according to law
• Provide an inventory and account of the estate assets

Identify and locate the deceased’s assets (including sums owed to the deceased) * Identify the deceased’s liabilities and creditors * Obtain control, possession, or legal ownership of the assets

‘administer’ the estate in full by:

• keeping the assets secure * paying the deceased’s debts and liabilities * meeting administration expenses * paying legacies * and distributing the residue to those legally entitled.

However, PRs do have a general duty to carry out the administration with due diligence and within a reasonable time. PRs should complete the administration within 12 months of the date of death (s 44 AEA) known as the ‘executor’s year’ (but applies also to administrators). If the administration takes longer than 12 months this does not necessarily mean a breach has occurred, but from this time PRs are required to justify any delay.

• If additional assets are discovered after the administration is complete the PRs have a duty to administer these assets. * If creditors or beneficiaries, who were not known at the time, come to light after the estate is fully administered and demand their entitlement, the PRs may be personally liable. This matter is not considered in detail in this element.

In addition to the general duty of due diligence, by virtue of s 35 TA 2000 PRs are subject to the same statutory duty of care as trustees when they exercise powers under the TA 2000 to which the duty applies.

Fiduciary duty: PRs must not, unless authorised by the court or fully informed beneficiaries: Place themselves in a position of conflict e.g. a PR may not purchase an asset from the estate even if this is for a fair value or Profit from their position

Question 15

What is the power to appropriate?

Answer 15

The power is subject to the following rules:

· A specific beneficiary must not be prejudiced.

· Consent of recipient beneficiary is required.

· The value of the asset must be considered at the date of transfer/appropriation rather than the date of death.

If the value of an asset exceeds the beneficiary’s entitlement the PRs may not appropriate.

If the value of the asset is less than the entitlement the PRs may appropriate and then make a balancing cash transfer.

Question 16

How can PRs use their power to invest?

Answer 16

The general power of investment in s 3 TA 2000 applies to PRs just as it does to trustees. PRs are also permitted to acquire freehold or leasehold land in the UK in accordance with s8 TA 2000.

PRs must carry out regular reviews of investments (commonly annually).

When exercising the general power of investment or reviewing their investments the PRs must have regard to the standard investment criteria in s4 TA 2000.

The s 5 TA 2000 duty to obtain advice also applies unless the PRs reasonably conclude that in the circumstances it is unnecessary or inappropriate.

Question 17

How does the power of a PR to charge for their services work?

Answer 17

Professional PRs e.g. solicitors may claim reasonable remuneration for their services (i.e. time spent carrying out the administration) provided:

· they are not acting alone, and

· that co-PRs give their written consent.

A lay PR or, a professional PR who is acting alone, needs to be given express power in the will to charge for their services.

S 28 TA 2000 makes it clear that payment as remuneration for services is not to be treated as a gift under s 15 Wills Act 1837.

Question 18

What work may a PR delegate?

Answer 18

PRs are permitted to employ agents and delegate their powers, except for the following:

· how and whether assets should be distributed

· whether fees or costs are payable from income or capital

· the appointment of trustees /nominees/custodians

PRs may not appoint a beneficiary as their agent but may appoint one of the PRs if they are sufficiently qualified.

If delegation is required, the PRs must:

· do so in writing to the agent and

· provide them with a written policy statement which the agent must agree to comply with (s15).

The use of an agent and the terms of the policy document need to be kept under review (s22).

Question 19

What powers to PRs have regarding trusts?

Answer 19

Power to appoint trustees (gifts to minors) (s 42 AEA)

Where a legacy is given absolutely to a minor there is no general power to pay the legacy to the beneficiary until they reach 18 because a minor cannot give valid receipt.

The PRs therefore need to hold the relevant assets on trust for the minor, investing these assets in accordance with the statutory powers and utilising their statutory powers of maintenance and advancement where appropriate, until the minor attains 18. (These powers are held in their capacity as trustee and, therefore, not considered in this element.)

However, under s 42 AEA PRs could instead appoint trustees (usually the minor’s parent/guardian) of the legacy and give the legacy to the trustees rather than retaining it.

Power to accept receipt from parent

It is thought that under s.3 Children Act 1989 a minor’s parent or guardian has the power to give a good receipt to the PRs on behalf of a minor. However, this power is commonly included expressly for clarity.

If the testator does not want the parent or guardian to receive the legacy on behalf of the minor, the will can be drafted expressly to give the legacy to trustees to hold until the child reaches majority.

Note that an express clause within a will which permits PRs to accept receipt from a minor beneficiary aged 16 or older is effective.

Question 20

Can a joint PR act alone?

Answer 20

Can a joint PR act alone?

If more than one PR is appointed then, similarly to trustees, they are required to make decisions together and should exercise discretionary powers unanimously (unless the PRs are joint executors appointed by will and the will states otherwise).

However, when exercising a lawful power to sell or transfer an estate asset during the administration, a jointly appointed PR will usually have the authority to act alone. For example: a PR acting alone has authority to pass title to the deceased’s personal possessions to a third party and so bind the other PRs.

Note that, as an exception, a sole PR may not deal with stocks and shares which are registered in the joint names of the PRs.

Question 21

When can a claim be brought against a PR?

Answer 21

Maladministration could include:

• Incorrectly administering the estate by making distributions to the wrong beneficiaries
• Using the residuary estate to meet liabilities which should have been paid from other parts of the estate
• Paying legacies before debts without retaining sufficient funds for creditors

Misuse of assets could include:

• Making personal use of the estate assets

Negligence might include:

• Unreasonable delay in carrying out the administration
• Failing to invest or making poor investment decisions in breach of the duty of care

Breach of fiduciary duty could include:

• Acting as both buyer and seller of estate assets unless the transaction is authorised (breach of ‘no conflict’ duty even where a fair price is paid)
• Receiving unauthorised remuneration (breach of ‘no profit’ duty)
• Self-dealing

Question 22

Can a PR be removed?

Answer 22

In addition to any personal liability, a PR who fails to carry out their duties properly may be effectively removed as PR by:

· A court order under s.50 Administration of Justice Act 1950 appointing a replacement PR

· An administration action, where the court would take over the administration itself

Question 23

How can a PR protect themselves against liability?

Answer 23

· Seeking court directions

· S 48 AJA 1985 application

· S.27 Trustee Act 1925 notice

· Benjamin Order

· Presumption of Death Act

· Insurance

· Payments into court

· Indemnity from beneficiary

· S.61 Trustee Act 1925

Question 24

When might a PR seek court guidance?

Answer 24

If PRs foresee difficulties in the administration (e.g. the construction of the will is ambiguous) and are concerned this may lead to them incurring personal liability (e.g. by making distributions to the wrong beneficiaries) they may seek court guidance.

Administration proceedings could take the form of:

• an administration action application to have the estate administered by the court.
• specific relief, an application for guidance on a particular matter.

Payment to court

PRs could pay the legacy amount into court and distribute the balance of the estate. Although the person who would otherwise benefit from the share paid into court may not favour this option.

While the purchase of insurance would be a preferable option re a missing beneficiary, a payment into court may be suitable where a beneficiary can be located but is refusing to accept their inheritance.

Exoneration by the court

Under s.61 Trustee Act 1925 a PR may apply to the court for an order exonerating them, in whole or part, from personal liability for breach.

An order will not be made unless the court considers that the PR:

· acted honestly and reasonably,

· ought fairly to be excused for the breach of trust and for omitting to obtain directions of the court in the matter

[S.61 refers to trustees, which includes a PR for these purposes]

Question 25

What is s48 AJA 1985?

Answer 25

Although seeking court directions is the most prudent course of action, it is also very expensive and time consuming.

In cases where there is a question over the construction of the will, the PRs may instead make an application under s 48 Administration of Justice Act 1985 to distribute in accordance with a written legal opinion (providing the opinion is given by a person who meets the criteria in s 48 and there is no dispute making it inappropriate for the court to grant permission to rely on the opinion).

Question 26

What is s 27 Trustee Act1925?

Answer 26

PRs who distribute the estate remain personally liable to unpaid beneficiaries and creditors, even if the PRs were unaware of their claim at the time of the administration.

To prevent liability to unidentified beneficiaries and creditors, the trustees may publish a notice of their intention to distribute to known beneficiaries two months after the date of the advertisement.

The notice must be placed in the London Gazette, a newspaper circulating in the area in which any land held on trust is situated, and any other newspaper which is appropriate e.g. if the deceased owned a business, the relevant trade paper may be appropriate.

Section 27 only protects against claims by unknown beneficiaries and creditors.

It does not protect the PRs if they distribute assets ignoring the claim of a known but missing beneficiary or creditor.

It also does not protect other beneficiaries who receive more than their entitlement to the estate. A disappointed creditor/beneficiary may still claim against the beneficiaries.

This means PRs who are also beneficiaries may still be liable to other beneficiaries. S27 protects PRs from claims against them in their capacity as PR but not in their capacity as beneficiary.

Question 27

What is a Benjamin Order?

Answer 27

In the case of known but missing beneficiaries, the PRs will not be able to rely on s 27 TA 1925 and may instead seek a Benjamin Order permitting them to distribute the estate on the basis that the missing beneficiaries have died.

Although this is the common situation in which a Benjamin Order is used, it might also be used to permit the trustees to distribute the estate on the basis of a different assumption, such as the assumption that the missing beneficiary had no children.

The order relieves the PRs from personal liability if they administer an estate in accordance with the court order and the assumption turns out to be incorrect. As with s 27 TA 1925, a disappointed beneficiary or creditor can still make a claim against other beneficiaries to whom the property had been distributed.

Before an order is awarded the PRs must make full enquiries to attempt to establish the true position (Re Benjamin 1902) and demonstrate there is no reasonable prospect of knowing the true position without disproportionate expense.

Question 28

What does the Presumption of Death Act 2013 do?

Answer 28

The PRs may make an application under this act for a court order declaring that a person thought to have died, or not known to have been alive, for seven years or more has died.

The order will confirm the presumed date of death and relates generally to the deceased’s property and affairs.

If the criteria for application can be met it may be quicker and easier to use this process rather than requesting a Benjamin Order.

Question 29

Can PRs use insurance or indemnity to protect themselves?

Answer 29

Insurance

The PRs could purchase insurance to cover the risk that the beneficiary or creditor returns after the administration is complete and makes a claim against the PRs for the share they should have received.

However, it may not be possible to obtain insurance if the risk is too high. Insurance premiums may also be very expensive (although are likely to be less expensive than seeking a Benjamin Order).

Indemnity

The PRs could seek an indemnity from the beneficiaries they can trace.

The beneficiaries promise to reimburse the PRs for any loss the PRs suffer as a result of being sued by a disappointed beneficiary or creditor.

An indemnity from the existing beneficiaries is only as good as the person giving it. Also, it may prove difficult in the future to trace those providing the indemnity. As such this may not be a preferred option for the PRs.

Question 30

Can wills contain liability exemption clauses?

Answer 30

Exemption clauses in a will

The testator’s will may contain clauses which exclude or restrict liability for a PR’s wrongdoing. These clauses may cover a range of scenarios from innocent mistake to gross negligence and may offer different levels of protection to lay and professional PRs.

See the example below for a clause which exempts lay executors from liability (but still allows claims against professional executors) and also excludes the statutory duty of care for all executors:

“None of my Executors (other than a professional executor) shall be liable for any act or omission save for an act or omission involving willful fraud or dishonesty and I further declare the duty of care contained in section 1 of the Trustee Act 2000 shall not apply to any of my Executors”

Question 31

What are the main types of grant?

Answer 31

Grant of probate

Grant of letters of administration (with will)

Grant of letters of administration

Question 32

What does a grant confirm?

Answer 32

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

An official signature, stamp and holographic seal are added.

Question 33

Is a grant of representation required?

Answer 33

Legally, the succession estate vests in the hands of an executor from death but does not vest in the hands of an administrator until their appointment is confirmed by the grant.

Question 34

When is a grant of probate required?

Answer 34

• The deceased left a valid will
• The will appoints executors
• At least one of the executors appointed is going to act

Question 35

What assets can a PR deal with without a grant?

Answer 35

• Assets which can be distributed under the Administration of Estates (Small Payments) Act 1965 - up to £5,000 although most banks now have their own policy
• Personal household possessions
• Cash

Question 36

What are the preliminary steps of an administrator?

Answer 36

• Family members will usually register the death, arrange the funeral.
• The PRs must locate the original will (and any codicils) to identify the beneficiaries. If there is no will the intestacy rules will form the basis of the estate distribution.
• It is important that the PRs identify any potential problems with the will or codicil before making the application for a grant of representation.
• The PRs must compile a complete list of the deceased’s assets and liabilities as at the date of death and their lifetime transfers. Each institution the deceased had dealings with should be notified of the death.
• When valuing estate assets the PRs should be aware of any particular rules that apply and should record the value of the deceased’s share of any jointly owned assets.

Question 37

What happens if no PR remains?

Answer 37

Either: * Chain of representation applies, or * Grant of letters of administration de bonis non is issued

The chain of representation will apply if the last surviving executor (E1) dies having appointed an executor of their own estate and this person takes out the grant probate for E1’s estate (E2). S.7 AEA 1925 provides that E2 automatically becomes executor of the original testator’s estate as well as being executor for E1’s estate. No additional grant is required.

S.7 does not operate where administrators are acting.

If the chain of representation cannot operate a second grant will be issued - a grant of letters of administration de bonis non.

Three requirements must be satisfied: * the administration is incomplete; * there are no remaining personal representatives; and * there has been a previous grant of representation.

Question 38

When will an executor be unable to act?

Answer 38

• pre-deceased the testator or survived the testator but died before taking out the grant
• are a minor
• lack capacity
• are the testator’s former spouse/civil partner and the divorce/dissolution took place after the will was made. By s.18A/C Wills Act 1837 (unless the will expressly states otherwise).

Question 39

What should an executor do if they are unwilling to act?

Answer 39

• Renunciation
• Reserving power
• Appointing an attorney

Question 40

When can an executor NOT renounce their role?

Answer 40

An executor cannot renounce if they have intermeddled with the estate and the court will not accept an attempt to renounce.

What is intermeddling?

A person intermeddles when they take steps indicating they have ‘accepted their appointment’ and are fulfilling the duty to administer the estate (even if they do not in fact wish to act as executor). Examples include:

“Obtaining, receiving or holding” the deceased’s assets, or forgiving any debt or liability due to the estate (s 28 Administration of Estates Act 1925)

Paying debts, selling assets, disposing of personal property (under common law)

Acts of common humanity such as arranging a funeral or taking steps to secure the estate assets do not amount to intermeddling.

Question 41

What if an administrator is unwilling to act?

Answer 41

If a potential administrator does not wish to act they have a number of options:

• Renunciation
• Appointing an attorney

Note that unlike an executor, an administrator cannot ‘reserve power’.

Question 42

How can someone apply for the grant of representation?

Answer 42

• Completing and then posting a paper application form to Probate Registry
• Submitting an online application via HMCTs service and answering the relevant questions

Question 43

How do professional PRs apply for the grant of representation?

Answer 43

• Mandatory online application (includes most grants of probate)
• Online application possible but not mandatory (includes some simple applications under NCPR 20 and 22 e.g. sole applicant and no minority or life interests)
• Mandatory paper application (includes non-standard grants, and more complicated applications under NCPR 20 and 22). The full list is shown in Schedule 3 NCPR and includes those noted below:

o Second grant of probate e.g. to an executor who previously reserved power

o Grants to a PR where chain of representation applies

o Grants where original will is missing or there are issues with the will

o Grants to attorneys

o Grant under NCPR 20 if life interest arises

Question 44

What paper applications are used for a grant of representation?

Answer 44

• PA1A: deceased did not leave a will - NCPR 22 applies
• PA1P: deceased left a valid will (whether or not executors are appointed)

These are sent to the probate registry

Question 45

What do all grant of representation applications require applicants to do?

Answer 45

• confirm the identity of the deceased and the applicants (full name and aliases, address and contact details)
• justify the type of grant requested and their entitlement to act as PR
• provide information about the value of the estate and inheritance tax (IHT) status of the estate
• complete the legal statement on the probate form confirming the information provided is correct and they will administer the estate properly

Question 46

When does NCPR 20 apply?

Answer 46

• Grant of letters of administration (with will) is required where no executors appointed by will are applying and so NCPR 20 applies.

Applicants under NCPR 20 should:

• state which category of applicant they fall within (with reference to the will)
• clear-off anyone with a better right to apply (but not those with equal right) e.g. explaining why executors appointed by will are not acting
• state whether any beneficiary is a minor or if any life interest arises (in either case, at least two administrators are then required)

Question 47

When does NCPR 22 apply?

Answer 47

• Grant of letters of administration is required where the deceased did not leave a valid will (i.e. died intestate) and so NCPR 22 applies

Applicants under NCPR 22 should:

• state their familial relationship to the deceased / identify which category of applicant applies, and confirm they are entitled to the whole or part of the estate
• clear-off anyone with a better right to apply (but not those with equal right) e.g. explaining who surviving family members are
• state whether any beneficiary is a minor (if so, at least two administrators are required)

Question 48

When do probate registry fees and the death certificate apply?

Answer 48

Applicants must pay the probate registry fee. The amount depends on whether or not a professional is applying and the value of the estate. There is no fee for estates worth less than £5,000.

There is no “original” grant. The Probate Registry will provide the number of sealed copies as requested by the PRs when making the application.

The number required depends on the estate assets e.g. one per asset holder and a couple of spare copies. There is a small fee for each sealed copy requested.

Sealed copies are used when contacting assets holders. For example, if the deceased had an account with three different banks, the PRs would provide each bank with a sealed copy as evidence of their entitlement.

The PRs state how many sealed copies they want when completing the application.

A certified copy (not photocopy) of the death certificate should be provided.

Question 49

What items compromise an application for grant?

Answer 49

Needed for all applications:

• Online application or PA1A or PA1P
• Application fee + £ per sealed grant

Needed for some applications:

• Certified copy of the death Certificate
• Original Will / Codicil (if testator made one)
• Form of Renunciation (if an executor is renouncing)
• IHT 421 (if the estate is not excepted)
• Affidavit evidence
• Power of Attorney (if an attorney is applying)

Question 50

What aspects of the deceased’s income is taxed?

Answer 50

The PRs will need to account for:

• untaxed income due and paid before death
• some income paid after death which relates to a period before death. E.g.

o Rent due on properties the deceased let, but which had not been paid

o Final dividends declared before death but not paid.

Question 51

What is the statutory entitlement order under NCPR 20?

Answer 51

a) executor; b) trustee of the residuary estate; c) any residuary beneficiary (whether taking absolutely or for life), or, where there is a partial intestacy, a beneficiary of the estate under intestacy; d) the PRs of anyone in (c) other than a trustee or life tenant of the residue; e) any other beneficiary or a creditor; f) PRs of anyone in (e).

Question 52

What is the statutory entitlement order under NCPR 22?

Answer 52

a) surviving spouse or civil partner b) children of the deceased c) father and mother of the deceased d) whole blood siblings (share both parents) e) half-blood siblings (share one parent) f) grandparents g) uncles / aunts of whole blood h) uncles / aunts of half blood

Question 53

What is the legal requirement for making an affidavit?

Answer 53

• signed by all parties and dated
• completed and signed by the person witnessing (this must be an independent solicitor or commissioner for oaths) and their name, address and qualification must be stated
• must follow immediately on from the text and not on a separate page

Question 54

When are affidavits required?

Answer 54

Ideally, affidavit evidence would not be required. However, this may be needed where there is a valid will but there is something about the document which renders its validity or interpretation uncertain. The original will is submitted with the affidavit and the affidavit provides confirmation to the Probate Registry of the circumstances surrounding the drafting or execution of the will.

Where applicable, an affidavit will often relate to one of the following:

-Compliance with s.9 Wills Act (e.g. - Signatures are oddly placed, There is no attestation clause (but e.g. three signature appear at the end) )

-Knowledge & Approval

-Date (missing, incomplete, more than one date is included)

-Physical condition of the will (In the absence of affidavit evidence, PRs will have to rely on the presumptions regarding timing and interpretation in s 21 Wills Act 1837 and the common law when deciding how to distribute the testator’s assets.

• There are other physical signs that suggest a will may be incomplete or have been tampered with:
• Pin holes (indicating staples have been removed)
• Paperclip indentations (indicating another document was attached to the will)
• Non-consecutive page/clause numbering or other sign there may be missing pages
• Signs that an attempt had been made to revoke the will e.g. burning, crossing names out or tearing)

Question 55

What is the order of payment of legacies?

Answer 55

In general law, unless the will states otherwise, legacies are paid in the following order:

1.specific

2.general

3.residuary

If it is not possible to pay all of the legacies they abate (reduce) in reverse order. So:

• If funds are insufficient to pay all other legacies the residuary beneficiary takes no benefit.
• If funds are insufficient to pay all specific legacies, the general beneficiaries take no benefit. If there are sufficient funds to meet all specific gifts but not all general legacies, the general beneficiaries take a reduced inheritance. (Demonstrative legacies abate with general legacies once the specific fund set aside has been exhausted.)
• specific gifts take priority.

Within each category, if not all of the legacies can be paid, they abate proportionately.