Financial Matters

With David Frederick FCCA | Marcus Bishop Associates | marcus-bishop.com

Is there a will or not?

"The pain of the loss in some households was exacerbated where members had died without a will"

The last few months may have been perhaps the most difficult times encountered by most households. This was especially the case for households who had bereavements and modified funeral arrangements due to compliance with social distancing. The pain of the loss in some households was exacerbated where members had died without a will. Let’s look at the case of Veronica who was building an emerging portfolio of buy-to-let properties but sadly passed during the period of Stay-At-Home without a will. Veronica’s brother Gareth decided as his sister was unmarried, estranged from her two children in the UK and her youngest son (aged 29) was overseas he would take responsibility for arranging her funeral and contacted her bank, to release some funds to pay for his sister’s funeral. Prima facie Gareth’s behaviour, may appear wholly innocent and what one might have expected from a caring brother following the death of his sister. However, Gareth had not recognised that his actions were at odds with the death of a person intestate. This is the term assigned to anyone who dies without a will. They are deemed to have died ‘intestate.’ The Rules of Intestacy in England and Wales, sets out who can apply to the Court for Letters of Administration to bring closure to the deceased’s estate. Siblings are ranked fourth in the hierarchy of the classes of individuals who can take responsibility for the estate. The first three classes of individuals are as follows: 1) Spouse/Civil Partners 2) Children 3) Parents It is also necessary to state that in some instances the siblings may be fifth in line. This may arise if the children of the deceased had predeceased and were survived by their own children. Gareth readily accepted his new learning and his misunderstanding of the legal position following his sister’s death. It was most fortuitous of Gareth to recognise his position as the story was about to radically change. Several days later, Veronica’s youngest son, Greg, arrived in the UK. It was both a surprise but pleasing to learn in discussion that his mother had made a will. Moreover, she had hand delivered him a copy earlier this year on her last visit. The tale ended with Greg being able to obtain the original will from the firm of solicitors. This enabled a seamless process to obtain the Grant of Probate rather than Letters of Administration. The arrival of Greg and the additional facts helped transform the case and provide monetary and time savings for the family. In addition, this case presents three key learning outcomes for the planning and administration of estates. Firstly, whilst we all enjoy the secrecy of our personal life, it may just be good practice to save our loved ones time and money, if we share with them two estate planning basics: (i) we have made a will and (ii) where it is located. The presence of a will and its location reduces the time, cost and stress following the loss of a loved one. This allows the executors of the will to apply for a Grant of Probate rather than apply the Law of Intestacy to obtain Letters of Administration. Reducing any unnecessary additional costs to the estate is always a preferable option for the beneficiaries of the estate. Finally, it is most premature to conclude that a person has died intestate, before fully moving heaven and earth and undertaking due diligence to fully exhaust the will search exercise. Gareth’s fortunes could have been so much more painful, financially, had it not been for the arrival of his nephew to complete the story. Perhaps, the real lesson is it’s never about how fast but how well the estate administration is undertaken.