My Brother died leaving large debts - any advice really welcome

[Recently_Bereaved]

Hello everyone

My Brother, who was only 37 recently passed away. He had Mental Health Issues and was tragically found dead in his flat. I am acting as executor and have found that he has bills totaling many thousands of pounds. He just buried his head in the sand and ignored the bills, bailiff letters etc. Most of the bills pertain to outstanding utilities like the water, gas, electricity, council tax etc. (Even though he was blind and had poor mobility his mental health condition meant that he always refused to claim benefits and we would largely support him with money and food etc although we never paid any bills). Anyway the bills are astronomical for example £4000 for the gas, even more for the electric, £2000 council tax and around £1500 for the water bill (and these bills are based on estimated use with the actual meter readings being over three times the estimates from what we can see). He has died without any liquid assets / money in the bank and my first question is will I have to sell his flat (which my father bought and put in my brother's name) to pay all these bills? The bills go all the way back to around 2008. It seems really unreasonable that they have just simply kept on supplying him and just let the total keep on building and building up like this. Do you think the big energy companies and council will show any empathy and write off the debts? (I have not spoken to them yet)
My second question is that I understand I ought to advertise in the gazette so any other potential claimants might come forward but as our family will be the beneficiaries would I be correct in thinking that this would not protect us from further claims down the line anyway?

Any advice really appreciated.

[Tools]

Re: My Brother died leaving large debts - any advice really welcome

Firstly Hi and welcome to the forum, sorry to hear about your brother and the situation you and your family have now found yourselves in. You should receive some good advice and guidance here from everyone. You say you are the executor, are there any family beneficiaries.

To start with the outstanding bills, is this everything you are aware of at present, do you think there may be others such as loans overdrafts etc. List as much as you know about at this time and we can then deal with each in turn and order of priority. So far we have:-

• £4000 for the gas,
• £4000+ electric,
• £2000 council tax
• around £1500 for water bill
• Bailiff demands, I assume for the above, please list these that you know about

Is the flat registered with the Land Registry in the name of your brother or your father ?
Is there an outstanding mortgage on the property and what is its approximate value?
Do you have other plans for the flat (renting it out etc)

Lots of questions to deal with at such a sad time so I apologise in advance.

[des8]

Re: My Brother died leaving large debts - any advice really welcome

Hi and welcome.
Sorry to hear of your bereavement.
You say you are acting as executor. Did he leave a will naming you and have you obtained a grant of probate?

Briefly, regarding his debts, they will have to be paid from his estate (which includes his flat)
If you are concerned about other creditors you need to insert a notice in the Gazette, and it is advisable also to use local papers.
A Deceased Estates notice is placed to minimise the liability of executors to outstanding debts for which the deceased’s estate is liable.
Creditors then have 6 months from date of death in which to lodge a claim against the estate (not the beneficiaries).
If you are uncertain about the existence of other possible beneficiaries do not make any payments to the beneficiaries for at least six months.

Be aware that if you are the Personal Representative you are personally liable for any errors in administering the estate. If for example you make an error in distributing the assets of the estate, any beneficiary who believes they have not received their dues, can sue you personally for the shortfall.It is possible to purchase Indemnity insurance to protect yourself (the premiums would be payable by the estate) or you could enlist the help of others e.g. solicitors(watch their charges)

I am amazed he has unpaid utility bills dating back to 2008. I would certainly at least question them.

You might find this article helpful: http://www.mylawyer.co.uk/managing-the-estate-a-A76991D77118/

[Recently_Bereaved]

Re: My Brother died leaving large debts - any advice really welcome

hi

thanks for the speedy response. Thanks for the sympathy, I have to say trying to deal with all of this is just a nightmare especially at this time.

• The flat is registered in my Brother's name.
• There was no will and my Father is next of kin. He is 80 however and not in great health. He is happy for me to act as executor as indeed is my Mother. Asides from myself there are no other immediate family members.
• There is no mortgage on the flat as my father bought it outright for my brother around 10 years ago (and unfortunately proceeded to hand the deeds straight over to my brother as my father thought this best at the time)
• Also I made a mistake and his council tax arrears actually stand at just under £4000 not £2000 as stated
• I would like to rent the flat out ideally

In addition to the bills I have listed we found that he had run up an overdraft of around £6000 pounds on one bank account (Natwest) and a slightly smaller amount on another (Barclaycard). However these bank statements date back to around 2008 and it would seem that the Banks gave up and closed the accounts in 2012 from what we can tell. There are certainly no more statements or chasing letters from them after this point and we have the account closed letters.

Similarly we have found lots of letters from the period of around 2006 to 2011 from various debt collecting agencies but they all seem to have given up from this point on with no further correspondence thereafter. There really are too many to mention in entirety but some of the larger ones include (I have rounded off the bills):
Argos £2000
Oriel / Pru Health £500
CapQuest debt recovery £1000
Mercers debt collections £2500
Robinsons Way Ltd £2500
Morecroft Debt Recovery £1000
Act Credit Management £300
Power Contact £100
B.T / Home Collection Services Ltd £500
Creditlink Account Recovery Solutions Ltd £100
AOL Broadband £100
Virgin Media £350
Apex Credit Management £150
Midascreditservices £250
Rundles
Call serve £2500

There are probably others as well but what I can say with authority is that other than the utilities and council tax the correspondence from these other companies / agencies seem to have stopped chasing him 2 or 3 years ago and that's why I am thinking it is best to let sleeping dogs lie especially if notifying the death in the Gazette will not protect these agencies potentially hounding my Dad who has Dementia further down the line

Finally please do not apologies as I really appreciate the help

Thanks in anticipation

[Tools]

Re: My Brother died leaving large debts - any advice really welcome

Thanks for the further info, as it is late/early try get some sleep(easy to say I know) and we will look through this tomorrow and over the next few days. It will take time for you to work through this but you will be given lots of help and support along the way.

[Recently_Bereaved]

Re: My Brother died leaving large debts - any advice really welcome

thank you

[enaid]

Re: My Brother died leaving large debts - any advice really welcome

• Also I made a mistake and his council tax arrears actually stand at just under £4000 not £2000 as stated

If your brother lived alone and was severely mentally impaired he should have been classed as disregard and up until 2013 should not have had to pay council tax.or at the very least have a 50% reduction.

2. Exemptions from council tax

Your property may be exempt from council tax. This would be the case if you (and anyone else living with you) are severely mentally impaired and no one else could be liable to pay.
‘Severely mentally impaired’ means you have a 'severe impairment of intelligence and social functioning (however caused) which appears to be permanent’; and have a certificate from a registered medical practitioner confirming this. You must also be entitled to a qualifying benefit, which includes:

• disability living allowance middle or highest rate care component;
• personal independence payment daily living component; or
• attendance allowance.

3. The Council Tax Discount scheme

You can get a discount of 25% off your bill if you are the only person living in your home or if all the other occupiers are ‘disregarded’ for council tax purposes. You can get a 50% discount off your bill if you and all the other occupiers are disregarded. Those who are disregarded include:

• people who are ‘severely mentally impaired’ (see Paragraph 2 above);

[des8]

Re: My Brother died leaving large debts - any advice really welcome

You state there was no will and because of your father's condition you are acting as executor.
Have you yet applied for a grant of representation? Without this you will not be able to deal with the estate ?
Here's a basic run down of what is necessary https://www.gov.uk/wills-probate-inheritance/overview

As you are personal representative you become personally liable for errors in settling the estate.
This effectively means that you must make every endeavour to allow creditors to make a claim against the estate.
If you don't advertise the fact of your brother's passing and settle the estate and then someone pops up with a valid claim (even years later), you could find yourself paying it.

Others here are better equipped to help you deal with the debts.

[Recently_Bereaved]

Re: My Brother died leaving large debts - any advice really welcome

My Brother had been sectioned acutely under the mental health act twice in the past 2 years. There was no firm diagnosis however and he never bothered attending any of his outpatient appointments. Equally he was just completely disengaged from society and a complete recluse. He would simply ignore all of his mail and as such never informed the council of his situation. The council would not listen to us and we felt abandoned by the mental health team as they said my brother had refused consent for intervention and as he was not overtly psychotic during his inpatient stay there was little they could do ........it s all a nightmare really. I have found medical paperwork which documents his blindness, spinal fracture and mental health admissions. The G.P. will also have this on file. I think I should probably speak to the council and explain but I fear that these days there is little in the way of empathy and as he had not filled out all of his exemption forms they will just want us to pay and with all the bills we will have to sell the flat.

[Recently_Bereaved]

Re: My Brother died leaving large debts - any advice really welcome

No I have not applied for a grant of representation yet but had googled the process but thanks anyway for the link.

I know what you are saying about the advertisement but I just wondered if it was worth a gamble as a lot of these creditors seem to have given up and written of the losses (as there chase letters / bailiff letters seem to dry up around 2 or 3 years ago. My brother's flat was set back behind a spiked wrought iron gate and I dont know for sure but I think Bailiff's would turn up and not be able to get access? He never answered the buzzer which was on the intimidating iron gate).

Do Bailiff's and debt collecting agencies routinely check the gazette?

[enaid]

Re: My Brother died leaving large debts - any advice really welcome

It can't do any harm to have a word (by word I mean in writing) with the council, I fear as your brother didn't claim any benefits they may not agree to any discount. Although if he was entitled to and didn't claim that may be enough if you understand me.
I would also do the same with the utility companies, explain the situation and also state you can prove his conditions if need be.
I am also mazed as to how the debts have been allowed to get to such amounts and no further action other than letters has been actioned.
As for the other debts , I will leave for others to give advice as I think more detail will need to be given if possible.

[des8]

Re: My Brother died leaving large debts - any advice really welcome

I can't answer for what the DCAs monitor in the way of adverts, or death announcements, but it wouldn't surprise me to find they had Google alerts set up.

I don't think lack of hearing from a DCA for a couple of years means you can assume they have given up. The debt will probably be sold on to yet another DCA who will start chasing in due course, but others here will have better knowledge and advice about tat.

My concern would be that your brother's financial affairs are so chaotic that a large creditor, of which you might not be aware, will pop up in the future and if you haven't take proper precautions you'll be liable.
It is for you to calculate the risks!

[Tools]

Re: My Brother died leaving large debts - any advice really welcome

Looking at the debts, some of them may be out of time for collection (Statute Barred) and the letters you have from various Debt Collection Agencies (DCA's) may even be just one or two debts passed backwards and forwards to different DCA's so try to match up similar amounts to one debt. For example 3 different DCA's may have been chasing one single debt of £250, that doesn't mean there are 3x£250 debts. Once you have established this things may not be as bad as it first appears.

As the good people here have already said, the council tax issue needs sorting first, then utilities, then others.

Are you/your dad in a position to clear any debts without having to sell the flat ?

The utility debts may take a reduced amount in full & final settlement but that is something you will have to negotiate with them yourself. When dealing with his creditors make them fully aware of his mental health status and ask that thisis taken into consideration as they have a duty to be sympathetic.

Before putting any notice, try speak with the council and utilities yourself, then the owners of other debts (loans etc)

[Recently_Bereaved]

Re: My Brother died leaving large debts - any advice really welcome

Thank you

Neither myself nor my father have anywhere near enough money to clear all of the debts although i could remortgage / take a loan / sell his flat

I will speak to the utilities and council and attempt a negotiation I think (does anyone have any experience of this sort of thing?!)

Yes you are right in terms of the DCAs - on closer inspection of their letters some of them pertain to the utility debts / council debts

I am tempted to leave sleeping dogs lie with regards some of the other debt - it seems to me, having looked on the net, that as my family are the sole beneficiaries legally that advertising in the Gazette offers us absolutely no protection from further claims down the line in any case and the advert might just stir them into action

[Tools]

Re: My Brother died leaving large debts - any advice really welcome

I think you may have to face up to the possibility that you may have to put the flat on the market to cover any debts, unless you can negotiate either a lower settlement figure as full & final or enter into affordable monthly repayment arrangements with his creditors.