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SQE - FLK1 > Wills and Probate > Flashcards

Wills and Probate Flashcards

1
Q

What are the two tests English law applies in determining validity of a will?

A

Must accord with:
1. Internal law of the country in which it was executed
2. Country in which T was domiciled
3. Counrty in which T was a national at the time of: (a) execution or (b) death

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2
Q

2 requirements for testamentary capacity?

A
  1. At least 18 years old
  2. Has mental capacity
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3
Q

4-stage test for testamentary capacity?

A
  1. Nature and effects of making a will
  2. Extent of property
  3. Moral claims to which they ought to give effect
  4. No insane delusion that affects the disposition of property
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4
Q

When is testamentary capacity assessed? Exception?

A

At the time of execution.

Exception is where:
1. T had capacity when instructing his solicitor to prepare the will
2. Will is prepared according to T’s instructions
3. When executing the will, T understood he was executing a will for which he gave instructions, even if he did not have full capacity

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5
Q

Who bears the burden of proving testamentary capacity? (2 points)

A
  1. The person seeking to have the will admitted to probate (usually the executors) BUT
  2. If the will appears to be rational on its face, capacity will be presumed and the BoP will lie on those opposing the will to prove incapacity
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6
Q

When does the presumption of testamentary capacity not apply? How can this risk be avoided?

A

When T is not normally compos mentis (e.g. long-term mental disorder).

Can be avoided by following GOLDEN RULE: getting a medical practitioner to: (1) confirm T’s lucidity at the time of execution and (2) witness the will

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7
Q

Who bears the BOP with respect to T’s knowledge and approval? 2 points

A
  1. Executor bears the burden of proving T knew and approved of the will’s contents BUT
  2. If T had the mental capacity to make a will, he is presumed to have knowledge and approval as well and the opponents of the will must prove otherwise
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8
Q

When is the test of knowledge and approval applied?

A

At the time of execution OR at the time T instructs a professional to write his will

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9
Q

What is the easiest way to resolve doubts as to knowledge and approval?

A

Include an ATTESTATION CLAUSE

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10
Q

In the testamentary context, how does undue influence work (3 points)?

A
  1. Burden is on thePERSON CHALLENGING the will
  2. Confined to ACTUAL undue influence
  3. Confined to COERCION (force or threats)
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11
Q

4 formalities for a valid will under S.9 of Wills Act 1837?

A
  1. In writing
  2. Signed by T or another person in his presence and by his direction
  3. Appears T intended his signature to give effect to the will
  4. T acknowledges or makes the signature in the presence of two or more witnesses present at the same time
  5. Each witness either: (a) attests and signs the will or (b) acknowledges his signature in T’s presence
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12
Q

What is the implication where a will is written partly in ink and partly in pencil?

A

Presumption is that pencilled parts were not intended to be final and should not be admitted to probate unless there is evidence T intended them to be final

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13
Q

Precaution where another person signs the will in T’s place?

A

Must adapt ATTESTATION CLAUSE to reflect exactly what took place

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14
Q

What exactly are the witnesses required to witness?

A
  1. T acknowledging that the signature on the will is his OR
  2. That T is writing on the will

Witnesses must be present at the SAME TIME

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15
Q

2 formal requirements surrounding witnesses’ signature of the will?

A
  1. Must sign, or acknowledge their prior signature
  2. In T’s presence
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16
Q

What additional procedure is required where the will contains no attestation clause?

A

Must include an AFFIDAVIT OF DUE EXECUTION before admission to probate

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17
Q

3 rules to keep in mind when selecting witnesses?

A
  1. Minors can witness if they have mental capacity
  2. Witness must be mentally and physically present
  3. If beneficiary (or his spouse or CP) witnesses the will, he will LOSE HIS BENEFIT unless there are at least two non-beneficiary witnesses
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18
Q

3 requirements for external documents to be incorporated into the will?

A
  1. Existed when will was made
  2. Clearly identified in the will
  3. Referred to as existing at the time
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19
Q

What is a privileged testator? How long does privilege last?

A

Can make wills without any formalities - can even be made orally.

Privilege lasts even after T ceases to be a member

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20
Q

3 classes of privileged testators?

A
  1. Soldiers in actual military service
  2. Mariner or seaman at sea
  3. Naval or marine forces in actual military service
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21
Q

What is the status of a mutual will: (1) before the death of T1 and (2) after T1’s death?

A

(1) Contractual agreement
(2) Constructive trust imposed on T2 in favour of the intended beneficiaries, preventing T2 from reneging on her promise to T1

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22
Q

4 requirements for a valid mutual will?

A
  1. Two or more persons execute wills pursuant to an agreement
  2. Agreement is in writing IF concerns disposition of land
  3. Parties agree that survivor shall be bound by the arrangement
  4. First party dies
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23
Q

What happens to a mutual will if T1 dies but T2 remarries?

A

Mutual will is revoked by operation of law but trust remains intact and continues to bind T2

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24
Q

2 points regarding a signed alteration to a will?

A
  1. Rebuttable presumption that a signed alteration was made PRIOR TO EXECUTION AND VALID
  2. Signature must be OPPOSITE OR NEAR to the alteration, or in a MEMORANDUM REFERRING TO THE ALTERATION
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25
Q

2 points regarding an unsigned alteration to a will?

A
  1. Rebuttable presumption that a signed alteration was made AFTER EXECUTION AND INVALID
  2. Will only be valid if: (a) T + 2 witnesses initial the alteration or (b) entire will with the alteration is re-executed or confirmed by a codicil, provided it refers to the alteration
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26
Q

What is the rule when an unattested alteration or obliteration is made to a will? 2 scenarios

A
  1. If the original wording is still apparent by natural means, the ORIGINAL WORDING is admitted to probate
  2. If the original wording is no longer apparent by natural means, the wording is REVOKED and the will is admitted to probate with a BLANK SPACE in place of the obliteration
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27
Q

What is the effect of the doctrine of dependent relative revocation? 3 points

A
  1. Usual rule is that EXTRINSIC evidence and NON-NATURAL means cannot be used to decipher a will
  2. But such evidence / methods can be used if there is evidence that T DID NOT INTEND TO REVOKE THE ORIGINAL WORDING OR
  3. There is evidence that T only intended to revoke the will conditionally (e.g., if the later will was valid)
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28
Q

What is a codicil (2 points)? What formalities must be included for it to be valid?

A
  1. Testamentary instrument supplementing the terms of the existing will
  2. With the effect of republishing the will to which it expressly refers at the date of the codicil’s execution

All the same formalities as a will must be followed

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29
Q

When does revocation of a will take effect?

A

If absolute, immediately. If conditional, then upon fulfillment of the condition.

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30
Q

4 ways of revoking a will?

A
  1. Later will or codicil
  2. Written intention to revoke
  3. Destruction of will
  4. Marriage or civil partnership
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31
Q

2 ways for a later will or codicil to revoke an earlier will?

A
  1. Express revocation clause
  2. Impliedly, which will ONLY revoke to the extent of any INCONSISTENCY (i.e. unaffected parts of previous will remain valid)
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32
Q

When does a revocation by later will take effect? Exception?

A

When the subsequent will is EXECUTED. But if the subsequent will is VOID (e.g. T lacked capacity), it cannot revoke a previous will and the first will remains in effect.

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33
Q

What formalities must be followed to revoke an earlier will by written intention to that effect?

A

All the same formalities as a will (signed by T, 2 witnesses etc)

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34
Q

4 requirements to revoke a will by destruction?

A
  1. Act which completely obliterates the essence of the will
  2. Which completes all T intends to do by way of destruction
  3. In T’s presence and by his direction
  4. T intended to revoke the will by this act at the time of destruction
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35
Q

What evidential presumption is noteworthy with respect to revocation by destruction?

A

A will that (1) was last known to be in T’s possession but (2) cannot be found on T’s death, is rebuttably PRESUMED TO HAVE BEEN DESTROYED with the INTENTION OF REVOKING IT

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36
Q

What is the rule surrounding marriage / CPs and prior wills? Exception (4 criteria)?

A
  1. Marriage or registered civil partnership AUTOMATICALLY REVOKES any prior will
  2. UNLESS it is clear ON THE FACE of the will that it was made: (a) BEFORE (b) IN CONTEMPLATION of a PARTICULAR marriage or CP (c) to a PARTICULAR person (d) in the foreseeable future*

ExtrinSIC EVIDENCE IS NOT ADMISSIBLE

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37
Q

If a married T separates from his spouse, what is the effect on his will?

A

No effect if no divorce or annulment order is made

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38
Q

If a married T divorces his spouse or dissolves his civil partnership, what is the effect on his will? 3 points

A
  1. Treated as if former spouse DIED on the date of the decree absolute, PARTIALLY REVOKING THE WILL
  2. Any prior appointment of the former spouse as EXECUTOR/TRUSTEE and/or TESTAMENTARY GUARDIAN will be revoked absent contrary indication
  3. LEGACY WILL LAPSE and fall into the residue

Note: same principles apply for a VOIDABLE MARRIAGE

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39
Q

If a married T’s marriage is void, what is the effect on his will?

A

Marriage is treated as never having occurred, so the existing wills are not revoked

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40
Q

3 requirements to revive a revoked will?

A
  1. Written will or a codicil complying with ALL NECESSARY FORMALITIES
  2. Instrument shows INTENTION TO REVIVE the revoked document
  3. Instrument is IN EXISTENCE at the time (i.e. not destroyed)
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41
Q

What are the 3 situations where extrinsic evidence is admissible to help a court interpret a will?

A
  1. Any part of the will is MEANINGLESS
  2. Language in the will is AMBIGUOUS ON ITS FACE
  3. Evidence (other than of T’s intention) shows that language in the will is AMBIGUOUS IN LIGHT OF SURROUNDING CIRCUMSTANCES
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42
Q

What is the scope of rectification?

A

Limited to correcting LINGUISTIC MISTAKES that prevent the instrument from reflecting T’S TRUE INTENTIONS

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43
Q

2 situations when rectification can be granted?

A

Will does not effect T’s intentions as a result of
1. Clerical error
2. Failure to understand T’s instructions

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44
Q

Deadline for application for rectification? What happens if deadline not met?

A

6 months from grant of probate (failing which, court permission is required)

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45
Q

What is a “devise”?

A

Gift of land / realty

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46
Q

What is a “legacy”?

A

Gift of chattels / personalty

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47
Q

What is a specific legacy? Key defining attribute?

A

Where T specifies a PARTICULAR PIECE OF PROPERTY

Subject to ADEMPTION

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48
Q

What is a general legacy? Most common kind of property?

A

Gift that is NOT of specific property but is instead to be provided OUT OF T’S ESTATE

Gift of money or shares

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49
Q

What happens if T leaves a general legacy of 100 shares in BP, but owns no shares in BP?

A

Executor will have to use estate monies to purchase shares in BP

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50
Q

What is a demonstrative legacy?

A

General gift where T specifies a designated fund out of which the gift is to be provided

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51
Q

What are the 3 certainties required for a valid gift?

A
  1. Intention
  2. Subject matter
  3. Objects
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52
Q

Define ademption. What is the consequence?

A

A specific gift is destroyed, lost, substantially changed or lawfully changes hands by the time of T’s death. The gift will FAIL and B will NOT BE ENTITLED TO COMPENSATION.

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53
Q

What are 3 situations where a gift of specific shares will stand even though the underlying company has changed?

A

Where the shares change in form only e.g.:
1. Company changed name
2. Company liquidated but was amalgamated with a new company

Or 3. Where gift was disposed of without authority

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54
Q

2 principles governing abatement?

A
  1. General legacies abate before specific legacies
  2. Demonstrative gifts are not vulnerable to abatement
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55
Q

When are the contents of a legacy to be construed?

A

Will speaks at the DATE OF DEATH.

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56
Q

What happens when T dies and his property is simultaneously destroyed?

A

Presumption that property was destroyed BEFORE T DIED - specific gifts will adeem.

57
Q

What happens when B predeceases T? How to avoid this result?

A

The gift will fail and fall into the RESIDUE, passing under INTESTACY rules.

Include an effective substitutional gift.

58
Q

When will a class gift lapse?

A

Only if ALL MEMBERS PREDECEASE T within the class

59
Q

What is the rule where a gift is made to two or more beneficiaries as JTs?

A

The gift will go to all SURVIVING BENEFICIARIES at the time of the distribution, and will only lapse if all JTs die.

NB - gift of property “in equal shares” is a gift as TENANTS IN COMMON

60
Q

What is the rule of commorientes?

A

If 2 beneficiaries die, the younger is deemed to have survived the elder for succession purposes

61
Q

What is the rule of statutory substitution (3 points)?

A
  1. Gift to the child or issue
  2. Intended beneficiary dies before T but his issue are still alive
  3. Gift will pass to surviving issue IN EQUAL SHARES
62
Q

Describe the rule in Lassence v Tierney (3 points)

A
  1. If a will contains a gift that APPEARS ABSOLUTE
  2. Followed by a DIRECTION THAT IT IS TO BE HELD ON TRUST
  3. The gift will be held on TRUST where EFFECTIVE
  4. But revert to an ABSOLUTE GIFT if it is INEFFECTIVE
63
Q

What presumption applies where T leaves his house to the spouse AND a life interest in the house to his issue?

A

That the gift to the spouse is ABSOLUTE notwithstanding the purported gift to the issue

64
Q

What is the rule of donatio mortis causa?

A

A gift made in contemplation of death TAKES EFFECT FROM DELIVERY and will fail if B predeceases T.

65
Q

What important presumption applies when leaving a legacy to an executor?

A

Any SPECIFIC OR PECUNIARY legacy to an executor is presumed to be CONDITIONAL on that person acting as executor

66
Q

When will it be acceptable for a solicitor to draft a will under which he receives a benefit? When is this particularly important according to SRA guidance?

A

If the client takes INDEPENDENT LEGAL ADVICE in respect of that gift

Especially important where the gift is of SIGNIFICANT VALUE

67
Q

3 precautions solicitor must take when taking client instructions on a will?

A
  1. Instructions for will-making can only be taken from the CLIENT THEMSELVES
  2. Should do so ALONE to avoid UI claims (and explain consequences / file attendance note if T refuses)
  3. Must assess T’s CAPACITY
68
Q

What does the term “issue” include (1 inclusion, 2 exclusions)?

A
  1. All legitimate, illegitimate and adopted children
    EXCLUDING
  2. Stepchild who is not adopted
  3. Natural child adopted by another person
69
Q

Describe the statutory intestacy rules surrounding the entitlement of a SPOUSE/CIVIL PARTNER (4 points)?

A
  1. Net estate up to 322,000 GBP OR no children - everything goes to spouse/CP

If net estate EXCEEDS 322,000, spouse/CP gets:
1. Personal chattels absolutely
2. 322,000 GBP plus interest from date of death
3. Half of the residual estate

70
Q

4 rules where an issue takes half of the residual estate on statutory trust?

A
  1. Held on a PER STIRPES basis (estate distributed according to FAMILY BRANCH)
  2. In EQUAL SHARESamong all surviving children, including en ventre sa mere, at the date of T’s death
  3. Until they attain the age of 18 OR get married OR register a civil partnership
71
Q

How long must a surviving spouse survive T in order to be entitled to inherit under the intestacy rules?

A

28 days beginning with D’s day of death

72
Q

What is the rule where T dies, leaving children but no spouse/CP?

What if there are no surviving children either (name 4 categories)?

A

Children share everything equally.

If no children, then in order:
1. T’s parents
2. T’s siblings (whole blood then half blood)
3. T’s grandparents
4. T’s uncles and aunts (whole blood then half blood)

73
Q

When would the surviving spouse need to exercise its special election under Schedule 2 of the Intestates’ Estates Act 1952 to purchase the matrimonial home?

A

Where T was the sole owner, or they held as tenants in common, then T’s spouse can elect to T’s interest in the home

74
Q

When may PR distribute the residuary estate?

A
  1. Pay all funeral, testamentary and admin EXPENSES
  2. Pay all of T’s LIABILITIES
  3. Distribute the residue under a TRUST FOR SALE
75
Q

Name 3 categories of property outside the succession estate.

A
  1. Property owned as JT
  2. Inter vivos gifts made donatio mortis causa
  3. Inter vivos gifts where T reserved benefit
76
Q

Name 2 important categories of property which fall outside both the succession and IHT estate

A
  1. Trust policies
  2. Pension scheme benefits
77
Q

What are the 2 kinds of grants of representation?

A
  1. Letter of administration - where there is (a) no will (b) no appointed executor or (c) no appointed executor that is willing and able to act
  2. Grant of probate - authorises executor to manage T’s estate in accordance with his will
78
Q

What are the 2 purposes of a grant of representation?

A
  1. Establish PRs’ authority to deal with the estate
  2. Establish validity of T’s will
79
Q

3 assets that can be collected without a grant of representation?

A
  1. Cash in T’s possession
  2. Chattels
  3. Sums of money below 5,000 in bank or BS accounts, on production of the death certificate
80
Q

What is the most important pre-requisite for obtaining a grant of representation?

A
  1. Submit HMRC account showing that IHT paid
  2. To Probate Registry
  3. Within 12 months of the end of the month of death
81
Q

When must IHT Form 205 be sent to the Probate Registry with the application for a grant of representation?

A
  1. Estate is excepted
  2. Date of death is before 1 January 2022
82
Q

3 minimum requirements for an excepted estate?

A
  1. T died domiciled in the UK OR the value of his relevant UK assets is under 150,000
  2. The value of T’s non-UK assets is below 100,000
  3. T did not make more than 150,000 GBP of lifetime chargeable transfers in the seven years before death
83
Q

3 requirements for a valid grant of probate?

A
  1. Valid will
  2. Under which the appointed executors are acting
  3. At least one executor has capacity (18 years old and mental capacity)
84
Q

When will an executor’s right to take out the grant and deal with T’s property cease?

A
  1. Executor dies without taking out the grant
  2. Executor renounces probate in signed writing, with a witness
85
Q

When will a grant of letter of administration with the will annexed be appropriate? 2 situations

A
  1. Will does not appoint executors OR
  2. An executor is appointed but cannot act because: (a) predeceased T (b) is unwilling or unable to take out the grant (c) divorced T or (d) died after T, but before taking out grant
86
Q

5 categories of people who are entitled to take out a grant of letter of administration with the will annexed?

A
  1. Trustee of the residuary estate
  2. Any residuary beneficiary
  3. Anyone entitled to share in the undisposed residue for a partial intestacy
  4. Any other beneficiary or creditor
  5. PRs of any of the above
87
Q

How many administrators can receive a grant of letter of administration with the will annexed? 2 points

A
  1. Maximum of four usually
  2. Where any beneficiary is a minor or a life interest arises, a grant of administration must be made either: (i) to a trust corporation or (ii) to at least two individuals, unless the court finds it expedient to appoint a sole administrator
88
Q

When will a grant of simple administration occur?

A

There is NO VALID WILL capable of being admitted to probate - i.e., total intestacy

89
Q

In a simple administration, when must two or more administrators be appointed?

A

Minimum of two administrators where property is held for minors on the statutory trusts

90
Q

What is the advantage of including in the will an attestation clause?

A

PRESUMPTION that the will was validly executed in accordance with S.9 of the Wills Act 1837

91
Q

Absent an attestation clause, who usually provides an affidavit of due execution? (4 categories)

A
  1. Attesting witnesses
  2. People present at the time of the will
  3. People able to confirm that the signature matches T’s handwriting
  4. Doctors
92
Q

When may an affidavit of knowledge and approval be required (3 situations)?

A
  1. T executed the will with a mark rather than a signature
  2. T was blind, illiterate or frail
  3. There are suspicious circumstances
93
Q

When may an affidavit of plight and condition be required (2 situations)?

A
  1. The state of the will suggests it has been INTERFERED WITH OR potentially revoked
  2. The state of the will suggests it is incomplete (e.g. it previously formed part of a larger document)
94
Q

Who usually provides an affidavit of plight and condition?

A
  1. Solicitor
  2. Person who made the potential attachment to the will
  3. Someone who can testify that: (a) will is in same condition as when it was found and (b) a search was made for later testamentary documents
95
Q

When and how can a draft or copy of the will (e.g. from solicitor’s file) be admitted to probate?

A

When the will cannot be located.

Requires affidavit evidence from applicant regarding: (1) contents of missing will (2) accuracy of the draft or copy (3) circumstances of the will’s disappearance, sufficient to revoke the presumption of revocation by destruction and (4) due execution

96
Q

When and how can intended beneficiary disclaim his interest?

A
  1. Anytime before accepting his interest in the estate
  2. Must make it to the PRs (must be in writing if avoiding IHT or CGT)

After validly disclaiming, B is treated as PREDECEASING T

97
Q

When and how can intended beneficiary effect a variation of his interest?

A
  1. He must already have accepted some benefit
  2. Must be made in writing (usually by deed) and if other Bs’ shares will be affected, their consent is required
98
Q

What important precaution must PRs take to ensure the estate is properly protected during administration? Exception?

A

ADEQUATELY INSURE the estate by paying the insurance premiums from the estate.

If B(s) entitled to the whole estate direct that the property is not be insured or only to be insured on certain conditions, then a BARE TRUSTEE must act accordingly

99
Q

2 reasons why PR might sell or exchange property from the estate?

A

To raise money in order to
1. Pay administration expenses
2. Satisfy any legacy or interest

100
Q

How can an executor renounce his appointment? Why must he be careful about doing so?

A

Sign Deed of Renunciation in the present of an independent witness and lodge it with the Probate Registry (takes effect on registration)

Renunciation is irrevocable save with the permission of a DJ or Registrar

101
Q

What happens if the only available executor renounces his appointment?

A

Must apply to court to appoint an administrator,

102
Q

What is the effect of an executor reserving his power? Most common use case?

A

He can step in at a later date if the other executors cannot continue with the process

Grant of probate will only be issued to a MAXIMUM OF FOUR EXECUTORS so if more than four are appointed, the rest may reserve their powers so they can obtain a grant later if a vacancy arises

103
Q

How does an executor reserve his power?

A

Apply to the Probate Registry for a grant of double probate

104
Q

What is the rule of Chain of Representation?

A

If the last eligible executor dies, the executor of their will becomes the executor of the original estate.

105
Q

Desacribe the fundamental duty of a PR (3 points). Timeframe?

A
  1. Collect and get in T’s realty and personalty
  2. Administer according to law (pay debts, legacies and residue)
  3. Prepare a full inventory of the estate (“estate accounts”)

Within a reasonable time

106
Q

What 4 standards of care are owed by a PR, and to whom?

A
  1. Due diligence
  2. Fiduciary duties
  3. Utmost good faith
  4. Statutory duty of reasonable care

Owed to the ESTATE AS A WHOLE, although Bs have a CHOSE IN ACTION to COMPEL DUE ADMINISTRATION of the estate

107
Q

When will PR be vicariously liable for a breach of duty by his fellow PR?

A

Where he had actual or constructive knowledge of the breach and failed to prevent the breach

108
Q

What is the statutory standard of care imposed on a PR?

A

Such care and skill as is reasonable in the circumstances, having regard to special knowledge or experience of them persoanlly, or expected of their business or profession

109
Q

2 general ways PR can avoid liability for breach of duty?

A
  1. WILL EXCLUDES LIABILITY
  2. Disadvantaged B or Bs generally have ACQUIESCED OR ENCOURAGED the breach
  3. Court is satisfied that PR acted HONESTLY and REASONABLY and ought FAIRLY TO BE EXCUSED for the breach
110
Q

What is the danger to PRs regarding unknown claimants?

A

PRs are PERSONALLY LIABLE to beneficiaries and creditors for UNPAID DEBTS AND LIABILITIES even if PRs were UNAWARE of these claimants at the time

111
Q

What is the effect of an effective S.27 Trustee Act advertisement?

A

Unknown claimants will only have claims against the existing assects, not the PRs.

112
Q

What content must an effective S.27 Trustee Act advertisement contain to protect a PR from unknown claimants? Where should the advertisement be placed (2 pts)?

A

1, Advertising their intent to distribute the estate and require any person interested in the state to send in particulars within a period of at least 2 months from the notice

Placed in:
2. Local newspaper in the district where T owns land
3. Any other local or national newspaper in which a court from which directions were being sought in an administration action might order advertisement (if unsure, just apply to court for directions)

113
Q

Limitation of S.27 notices?

A

Cannot protect against liability if PR has knowledge of a future or contingent liability or knows of a claimant but cannot trace them

114
Q

4 ways PRs can protect against liability to known but missing beneficiaries?

A

Normally, cannot - PRs have a duty to take ALL REASONABLE STEPS to locate the benefiaries.

If all reasonable steps taken:
1. Obtain a Benjamin order
2. Missing beneficiary insurance
3. Indemnity from known beneficiaries
4. Set aside a reserve fund or pay it into court, then distribute the remainder

115
Q

What is a Benjamin order and what is its effect?

A

Benjamin order is an order giving leave to the PRs to distribute the estate based on an ASSUMPTION (e.g. that missing B predeceased T).

Effect is that PR is fully relieved of personal liability but missing B may claim against other Bs if he reappears.

116
Q

How does PR normally fund missing beneficiary insurance?

A

From the estate, as a reasonable expense of the administration

117
Q

How will PR distribute assets after taking out missing beneficiary insurance?

A

Estate will be distributed as though the missing person is DEAD

118
Q

4 steps when collecting assets

A
  1. Identify the assets
  2. Collect within a reasonable time
  3. Pay into PR bank account or solicitor client account
  4. If needed: secure and safeguard, and possibly insure assets
119
Q

What is the difficulty for the PRs in paying IHT?

A

They need a grant to take control of T’s funds, but they need to pay the IHT (ideally from T’s funds) to obtain the grant

120
Q

What are 4 ways for PRs to fund IHT?

A
  1. Apply for funds to be paid directly from T’s bank account
  2. Obtain small payments up to 5,000 without production of a grant
  3. Bank loan, subject to an undertaking to account to the bank out of the first proceeds (including for bank fee + interest)
  4. Beneficiary loan, to be repaid from T’s estate once the grant is issued
121
Q

4 ways PRs can deal with assets of the estate?

A
  1. Transfer directly to B to satisfy their entitlement
  2. Transfer to HMRC to satisfy IHT liabilities
  3. Sell and use proceeds to satisfy beneficiary entitlements, IHT, administration expenses etc
122
Q

What is the definition of a SOLVENT estate?

A

Assets can fully cover: (1) the funeral and testamentary expenses and (2) debts

Note: irrelevant whether legacies can be paid in full

123
Q

What is the order of distribution for an INSOLVENT estate?

A
  1. Fixed chargeholders
  2. Funeral, testamentary and administration expenses
  3. Other claims
124
Q

Order of priority for UNSECURED debts in a solvent estate (6 points)?

A
  1. Property undisposed of by the will
  2. Gift of residue
  3. Property specifically GIVEN TO PAY DEBTS
  4. Property specifically CHARGED TO PAY DEBTS
  5. The pecuniary legacy fund retained as part of the undisposed part / residue
  6. Specific gifts
125
Q

Order of priority for UNSECURED debts in an insolvent estate (4 points - POID)?

A
  1. P - Preferred Debts
  2. O - Ordinary Debts
  3. I - Interest on the above debts
  4. D - Deferred debts from T’s spouse
126
Q

When does a class of beneficiaries “close” for purposes of distribution? Limitation of this rule (2 points)?

A

When the FIRST CLASS MEMBER obtains a VESTED INTEREST and becomes ENTITLED TO HIS SHARE OF THE GIFT

Only applies to TESTAMENTARY trusts involving gifts of CAPITAL

127
Q

What are the 3 categories of class gifts?

A
  1. Immediate class gift
  2. Deferred class gift
  3. Contingent class gift
128
Q

What is the best way for a will-drafter to ensure clear class closing?

A

Unambiguous wording that clearly CLOSES THE CLASS ON T’S DEATH

E.g. “living grandchildren at my death” or “grandchildren whenever born”

129
Q

How does a PR transfer a legal estate in land? Who pays the costs of transfer?

A

Through a WRITTEN ASSENT, naming the person IN WHOSE FAVOUR it is given

Beneficiaries entitled to a specific gift will bear associated costs (including insurance, preservation/maintenance costs) unless will states otherwise; otherwise costs will be paid out of residuary estate.

130
Q

When does an assent take effect? Implication?

A

Assent dates back to the date of death - so beneficiary is entitled to rental proceeds from that date

131
Q

In what order are legacies paid?

A
  1. Specific legacies
  2. Pecuniary legacies
  3. Residue
132
Q

When is B entitled to interest on a pecuniary legacy?

A

If payment is delayed beyond ONE YEAR following T’s death

133
Q

What is the complication when making a distribution to the minor?

A

Neither a minor nor her parent or guardian can give a valid receipt, so PR will need to: (1) use power of APPROPRIATION or (2) APPOINT TRUSTEES to hold the property for minot until he is 18

134
Q

What are the final 3 steps of administration?

A
  1. Calculate whether any additional tax or a tax refund (IHT / CGT / income tax) is due and obtain certificate of IHT discharge from HMRC
  2. Prepare estate accounts on the residue and seek approval from residuary beneficiaries
  3. Complete distribution of assets
135
Q

What is the limitation period for a Financial Provision claim? Exception>

A

Six months from the issue of the grant of representation.

Court can extend in exceptional circumstances but PR will no longer be personally liable

136
Q

What periods are covered by the probate registry search?

A

Any grant of representation made:
- 12 months BEFORE or
- 6 months AFTER
- the receipt of the application for financial provision

137
Q

Name 3 categories of people entitled to apply for financial provision even though they are not related by blood or marriage?

A
  1. FORMER SPOUSE or registered CP who has not remarried
  2. Any person T treated as a CHILD OF THE MARRIAGE
  3. Any person T was MAINTAINING BEFORE HIS DEATH (e.g. by providing rent free accommodation)
  4. Any COHABITEE who was PART OF D’S HOUSEHOLD in the TWO YEARS IMMEDIATELY before D’s death (NB: no maintenance requirement!)
138
Q

What are the two substantive standards that apply to a test of “reasonable financial provision”?

A
  1. Surviving spouse: whether financial provision is REASONABLE IN ALL THE CIRCUMSTANCES
  2. All other applicants: whether financial provision is REASONABLE FOR MAINTENANCE purposes
139
Q

What are 3 forms a court order for reasonable financial provision can take?

A
  1. Lump sum payment
  2. Periodic payments
  3. Transfer of specific property

Can be made against ANY ASSETS OF THE DECEASED

SQE - FLK1 (21 decks)

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