A personal representative for someone’s estate may be able to step down, although it will depend on a number of factors that should be taken into consideration first. The first question that needs to be asked is whether they have been appointed as an executor, or as an administrator.
If they are an executor, they can choose to step down – except in the case of two exceptions. They can do this even if they initially agree to the task, and this can happen due to a variety of reasons including ill health, another bereavement, or workload. If the executor wishes to step down, they must sign a Deed of Renunciation. This document means that the executor agrees to give up the role and any responsibilities that come with it. The deed is then filed with the Probate Registry and is made final. If the executor changes their mind and does want to take on the role after a Deed of Renunciation has been filed, a court can assess the situation. They cannot simply start carrying out the work without a court having given them permission.
There are two situations in which an executor is not able to step down from the role. The first is when the Grant of Probate has already been issued to the executor. If an executor no longer wishes to perform the role, then they cannot be issued with a Grant of Probate. There is the possibility that the Grant of Probate can be revoked so that the executor can step down, but this would only happen in exceptional circumstances.
The second situation in which an executor cannot step down is if they have ‘intermeddled’ in the estate. This is when the executor has begun and administrative work before the Grant of Probate has been issued.
An administrator is somewhat different to an executor. An administrator is a personal executive who is appointed by the Probate Registry if there are no executors named in a will (or they have died or stepped down), or no will at all. If they don’t want to take up the role, they don’t have to do anything – they simply don’t act. There are no forms to complete and no one to notify.
A man named Stephen Jackson has been found to have stolen almost one million New Zealand dollars from his dying mother. The man actually sold his parents’ house whilst his mother was in the process of writing her will – even though that will said that Ivy Jackson wanted to split the property between her three children. However, by the time she died the house had already been sold and it was too late to do anything about it.
Stephen Jackson then took a further $250,000 from his mother’s bank account after she passed away.
Only one of Mr Jackson’s siblings was living at the time of their mother’s death, and the High Court in New Zealand found in favour of that sibling, Raymond Jackson. It was found that Stephen and his wife Linda owed almost $1.1 million, plus interest, to the estate of his dead mother.
But how could this have happened in the first place?
In January 2014, Ivy Jackson suffered a stroke and was unable to return to her home. Knowing that she was very unwell, she proceeded to write a will which, two days later, was completed. The will stated that she wanted the house to be sold, and for the proceeds from the sale to be shared between her children equally. Everything that was left over would go to Stephen and Linda Jackson.
However, because Stephen had been made power of attorney after his mother’s stroke, he had already made arrangements to sell the house.
Ivy Jackson died one year later after spending 12 months in a nursing home. Stephen said that he had had to sell the house in order to pay for the home (and the payment for it does seem to have come from the proceeds of the house sale). However, Ivy had enough put into savings to pay for these fees without the need to sell the house at that time. And, despite some of the money being used for the care home, almost $600,000 was still unaccounted for when the case went to court.
On top of that, it was discovered that Stephen Jackson used his status as power of attorney to withdraw around $300,000 from a joint account that had been held by his mother and father.
And, although they were both named as executors in Ivy’s will, neither Stephen nor Linda actually executed it, and instead continued to make withdrawals from a variety of different accounts.
The couple did not attend the hearing and they cannot be contacted, although it is thought that they have since moved to Queensland. The case is therefore ongoing.
Notorious child killer Ian Brady died on 15th May 2017, never having revealed the whereabouts of the body of one of his victims, Keith Bennett, who had been 12 at the time of his murder. Myra Hindley and Ian Brady were the Moors Murderers, and between them they killed five children, burying the bodies of three of their victims (Lesley Anne Downey, Pauline Reade, and John Kilbride) on Saddleworth Moor.
It was feared that Brady’s ashes might be scattered on Saddleworth Moor, which was – horribly – one of his favourite places. However, Brady’s solicitor has confirmed that there is no chance at all of this happening. This has relieved many people, not least the families of the children who died.
The solicitor took the unusual step of ensuring that everyone was aware that the remains were not be taken to Saddleworth Moor because the coroner looking into the death wanted a guarantee that it would not happen before he would release the body.
In many instances, the choice of where to spread ashes is not something that is a problem. The rules are very relaxed about this, although it is wise to get the land owner’s permission if possible if it belongs to someone else. With regards to Saddleworth Moor, this is a public space, and there would usually not be any restrictions to scattering ashes there. This is a very different and unusual case.
An executor is always expected to act reasonably when it comes to dealing with someone’s will and estate. They must act in the best interests of the estate, and the beneficiaries named in the will. This involves a number of things including getting the best possible price for any property or assets that are sold. It also means that they should ensure that the death is registered correctly. If this is not done, there could be serious implications that affect many people, and their inheritances.
The estate must be calculated correctly as well. This is to make sure that, if any inheritance tax is due, it is paid on time, and at the correct figure. This needs to be done before any of the money and assets are distributed.
The death should also be ‘advertised’, for example it could be announced in a national newspaper. This is so that anyone who is not mentioned in the will but who is owed money by the estate can contact the executor to arrange for payment. These debts must be paid off before any beneficiaries can inherit. If this is not done, and someone makes a claim after the money has been distributed, the executor may be liable for the debt.
If someone disputes the will (ie, if they question whether the will is valid, or if they have evidence that there is a newer will, for example) then there could be further claims. Being executor is an important job with huge responsibility, and it is always worth getting independent legal advice if you take the job on, to prepare you.
Something that executors often ask is how do they pay the inheritance tax that is due on a deceased person’s estate when it is due before the estate is sold?
The first step is to hire professional valuers to come in and work out how much the estate is actually worth in terms of property, assets, savings, and anything else that is left over. Using an inheritance tax return (which needs to be submitted within six months of the death), the executor will need to inform HMRC of that valuation.
If the estate is worth less than £325,000 then no inheritance tax will be due since the estate falls into the nil rate band. Anything over £325,000 is taxed at 40 percent. So if, for example an estate was worth £800,000, inheritance tax would be due on £675,000, and, at 50 percent, that leaves a bill of £270,000.
That’s a lot of money to pay straight away.
But there are ways to deal with this. Firstly, HMRC allows the tax bills to be paid over 10 annual instalments, meaning that the amount that needs to be paid up front is much smaller than the entire bill. It could still be many thousands of pounds, though. In this case, banks and building societies are often happy to release funds from the estate in advance if they are going to pay inheritance tax. If this is the case, it may be better to pay the entire bill in full at the beginning, and be done with it.
Alternatively, if for any reason the bank won’t release any funds, there is such a thing as an executor’s loan, which can be borrowed against the property and paid back once it sells. It is best to speak to a bank about this.
Every will must have an executor. That’s the law. Or is it? Well, although it is true that there must be an executor for each will, the truth is that there must be at least one executor. In reality, it is perfectly valid and possible to have more than one should the testator require it. But why would more than one executor ever be needed?
In law, as many as four executors can be named in a single will and, if necessary, all four (or up to four) can apply jointly for probate. Once probate has been applied for, whomever is named as executor must continue in that role – but before this happens they can step down in need be. If this happens, and more than one executor has been named, then probate can still go ahead as there will be one, two or three other executors to take on the work. Executors should be told that they are being named as such in a will before the testator dies, but sometimes this isn’t the case and therefore it could well be that some of them may wish to walk away from the position. Having more than one executor makes this much easier.
Once probate has been granted, the executors must work together to make the process run smoothly. This can be difficult with more than one executor, and the concern is that some jobs won’t be done at all as everyone thinks someone else is doing them, and some jobs will be done more than once as everyone thinks it is their job to do. The best way that multiple executors can deal with the estate of the deceased is to work together, discussing all decisions before acting. It is fair, although it is time consuming and can sometimes be difficult to get in touch with everyone.
In this case, one person should be named as ‘lead executor’. How this person is chosen is not particularly important, although if someone has experience or knowledge of probate then they may well be the best person to choose. Alternatively, the executors can apply jointly to appoint a solicitor to carry out the work for them.
Before an estate can be executed correctly, it needs to be valued. And it is one of the executor’s jobs to do the valuing. It is especially important to get this right if the will of the deceased person dictates that a certain percentage of the estate must go to someone – it would not be possible to work out how much money that is exactly without knowing how much the estate is actually worth.
It is important to know the value of an estate for inheritance tax purposes as well.
It is an incredibly important part of being an executor, and because of this it can feel rather overwhelming. There is no need to worry, however – as long as the valuation is carried out in a clear and concise way, following the logical structure of things, it will work out in the end.
Included within the valuation are money, assets, property, and general possessions. Money includes all the money in every account that the deceased has, as well any cash that is actually in their home or even wallet or purse. It includes stocks and shares, pensions, and life insurance policies too. Assets include businesses, and it can be useful to engage a solicitor to deal with this. Property includes all buildings and land. Possessions are things such as fittings and fixtures, clothing, vehicles, jewellery and more.
Gifts that the deceased gave away but kept an interest in – knows as ‘gifts with reservation of benefit’ – also need to be included within the estate’s value. This could be a house that they gifted to someone but remained living in, for example. There are some gifts that are excluded, however. These include gifts to spouses or civil partners, gifts that were made more than seven years before the death, wedding gifts, and maintenance payments.
It can be a minefield of confusion when it comes to carrying out this valuation – so why not contact the experts who can help you out?
It is a rare event for someone to be an executor more than once or twice in their lives, and because of this no lay person ever becomes an expert in executing a will. Why should they when it is such a one off event? This does mean, however, that probate can take longer than it might otherwise have done because the person executing the will has no idea where to start. It could also mean that mistakes are made.
One of the most common mistakes is for the executor to underestimate just how much time this role will take. It is never a quick job, and with more complicated estates it can be almost like a full time job. Pre-planning can help ease the burden slightly, but it should never be assumed that being an executor is something that can just be worked on around other commitments, or, if that is the way it will need to be done then the executor will need to keep everyone informed of their progress.
Another mistake that is often made is that the executor does not keep clear records of the work they have done as they do it. This can be a problem when someone asks about how the job is progressing. Keeping a diary is the best way to keep on top of things, and know when to contact whom about what. It is a good idea to open a new, separate bank account where all the money from the deceased’s estate can be paid out of when required.
Executors sometimes also pay beneficiaries too early. If this is done – perhaps due to pressure on the executor from the beneficiaries – then it can cause problems later on when other bills need to be paid and the money has already gone. Executors also need to ask for proof of ownership of property etc, rather than simply taking things on trust. Never let a family member remove something from the estate until you have proof that they are allowed to do so.
It is always best to seek expert advice if anything confusing or out of the ordinary is found in a will that is being executed.
Ex-husband's inheritance appeal goes ahead
The Court of Appeal heard a case recently, whereby the ex-husband of a woman was granted an appeal to contest the validity of his late mother in law's will, in a bid to claim his alleged inheritance.
Prior to their divorce ten years ago, the couple had allegedly formed an agreement whereby on the mother in law's death, £100,000 from her estate would go to her daughter and the remainder of the balance of the estate would then be divided between the same daughter and her then-husband.
Although no dates are given, at some point in time after this event, the couple divorced and the wife's mother passed away. Her daughter was indeed left £100,000 but instead of the balance of £150,000 being divided between the daughter and the now ex-husband as previously agreed however, the entire balance was left to the woman's children.
The ex-husband subsequently argued that he was entitled to half of the balance which amounted to £75,000 and brought about a probate claim to challenge the validity of the will. This initial claim was turned down however, as the court found that he did not have enough "interest" in the will as a creditor of the beneficiary. The only people entitled to challenge a will it noted, are actual executors, beneficiaries and creditors of the deceased.
The Court of Appeal felt differently, however. Lord Dyson ruled that the man was connected enough to the estate to maintain sufficient "interest" and recognised that the only way he could fight for his money was to challenge the validity of the will.
The case will now go to appeal.