Executors duty to pay out funds to trustees

[lspeakman]

Can anyone help.
My parents property has now been sold and the proceeds with the sole executors solicitor - there are 6 beneficiaries - 3 under 21.
Probate was granted over 5 years ago and am asking for any information regarding
1. What is a reasonable length of time for the executor/solicitor pay out proceeds of sale.
2. What legal action be taken if no forthcoming proceeds appear from the sale after eg 4 weeks.
3. Who bears the costs of any actions taken?

[des8]

Re: Executors duty to pay out funds to trustees

Presumably the house was the last of the estate's assets to be realized.
The executor will have to ensure all liabilities arising from the house and its sale have been paid.
There may be assets still to be collected, eg refunds of insurance premiums, council tax, water charges, before legacies are paid.
Without knowing the full circumstances it is difficult to estimate what would be a reasonable timescale, but 4 weeks isn't long.
Why are you contemplating legal action? Do you have concerns about the executor or the solicitor he has appointed>

[SPQR]

Re: Executors duty to pay out funds to trustees

Ispeakman - unfortunately probate issues can take a long time (http://www.lawsociety.org.uk/for-the...ssues/probate/).

You can ask the solicitor for an interim distribution of the estate. Basically this allows distribution of most of the money in the estate, whilst the solicitor deals with any other liabilities etc until he can work out the exact worth of the estate.

[lspeakman]

Re: Executors duty to pay out funds to trustees

Hi the house the only asset was divided into 2 parts - my mum who died 8 years ago her will50pc of the house was to be divided between myself , brother and 4 grandchildren 3 under 21 - my brother has probate and one of two executors not me. My dad died last October - I was joint executor with my son and sold beneficiary I obtained probate . I have made sure all bills etc have been paid there are no debts outstanding . The property has been sold - my solicitor has the proceeds of which 50pc will come direct to me with the other 50 PC to go to my brother for distribution back to me and grandchildren. It's my brother I have concerns about - there is no valid reason for him to delay paying out on the proceedings however I think he will hold onto the monies as long as possible and that's why I asked what is a reasonable length of time , etc etc.

also 3 of the grandchildrens money has to be placed in trust until they are 21 need to know what requirements he has to provide - thanks for all your advice

[des8]

Re: Executors duty to pay out funds to trustees

When your mother died,your father retained his share of the house, but your mother's share was bequeathed to six of you.
Presumably your father retained the right to continue living in the house until he either died or moved.
Were Land registry records changed to reflect the new ownership details? Was the house valued at this time?
If they weren't, and if the executor retained control of your mother's assets and did not pass them onto the beneficiaries, I believe that he will have to pay interest (@5%PA?) on the value of the estate from 12 months after obtaining probate. Also , as he had a duty to preserve the assets, I assume he paid (from the estate) 50% of house insurance and maintenance costs?
If the land registry details were changed, reflecting the new ownership, there is no need for the cash from your mother's share of the house to be given to your brother. It goes straight to the owners (or in the case of the children to their trusts).
As the will he is dealing with is old, everything should be in place for a speedy distribution of the assets (are the trusts in position?) if he did not change land registry details.

I assume your not using the same solicitor as your brother

If it comes to push you could apply to have him removed as Trustee under Sec 50 of the Administration of Justice Act 1985.(but really to be avoided)

[lspeakman]

Re: Executors duty to pay out funds to trustees

Yes my father retained his share of the house and retained the right to live in the house until he moved or passed away.
The Land Registry wasnt changed at the time as the Solicitor has just done it at the time of sale. The house wasnt valued at the time in 2007.
Whilst my brother obtained probate as to what else he did I am not aware of the position.
I know dad obviously maintained the property had new boiler etc but refused to pay house insurance so I paid for it and this has been deducted from the split of proceeds.
1.Can I ask what happens now obviously sale prices have increased since 2007
2. Is 4 weeks sufficient time for his solicitors (not using the same as mine) to distribute funds after the length of time passed and I have dealt with everything
3. After 4 weeks if no funds are distributed am i within my rights to issue a pre legal letter to my brother demanding funds followed by Court Proceedings.
4. My son who is 19 ...does he have rights to request which fund the monies are placed in and request a regular update.
5. The other executor (my uncle) who lives abroad has had no dealings with the estate ...does he have any influence.
Thanks for your help and advise again

[des8]

Re: Executors duty to pay out funds to trustees

I wouldn't be concerned with the valuation in 2007 and interest payable on that amount, as the increase in house values will have compensated.
Although there might be a tax liability of some sort on the increase.

Certainly agree that 4 weeks sounds a reasonable time frame given the circumstances, but the solicitor might have a different view if there is tax to pay.
Your real problem lies with your brother who did not deal with the estate in a timely manner 8 years ago.

I personally would try and avoid legal action.
Whilst not knowing exactly what has been written between you I would be thinking of a letter enquiring as a beneficiary what sort of time frame their solicitor anticipated, viewing the fact the matter should have been dealt with years ago. Copy to your brother and his solicitor.

Regarding the trusts for the minors I believe (but this would need checking out) that if the beneficiaries request it when they reach their majority trustees must convey the trust property to the beneficiaries.(Don't know where that nugget of (mis)information came from... treat with caution!)
It would only be good practice to keep your son informed of the trust's performance.

[SPQR]

Re: Executors duty to pay out funds to trustees

I wouldn't be concerned with the valuation in 2007 and interest payable on that amount, as the increase in house values will have compensated.
Although there might be a tax liability of some sort on the increase.

There may be an inheritance tax issue if the total value of your dad's estate is worth over £325,000 (including the whole value of the house).

Certainly agree that 4 weeks sounds a reasonable time frame given the circumstances, but the solicitor might have a different view if there is tax to pay.

I think that 4 weeks is too short a time. It is not unusual for it to take up to a year to finish probate, and as your father passed away in October the solicitor is still within a reasonable time. (www.lawsociety.org.uk/for-the-public/common-legal-issues/probate/) I believe that requesting an interim distribution from the solicitor is the best bet.

I personally would try and avoid legal action.
Whilst not knowing exactly what has been written between you I would be thinking of a letter enquiring as a beneficiary what sort of time frame their solicitor anticipated, viewing the fact the matter should have been dealt with years ago. Copy to your brother and his solicitor.

I agree with des8 about avoiding legal action. You would be unlikely to recover all your costs (and perhaps be required to pay additional costs if you lose). I'm not too sure what you would gain from legal action.

Regarding the trusts for the minors I believe (but this would need checking out) that if the beneficiaries request it when they reach their majority trustees must convey the trust property to the beneficiaries.(Don't know where that nugget of (mis)information came from... treat with caution!)

This is correct. [It comes from the 1841 case of Saunders v Vautier] So your 19 year old son would be able to request his share before his 21st birthday.

The other executor (my uncle) who lives abroad has had no dealings with the estate ...does he have any influence.

Yes - provided that he is still an executor (the grant of probate will say).

[lspeakman]

Re: Executors duty to pay out funds to trustees

I would estimate the difference in valuation would be £20k over the 7 years - would this still be taxable?
What about the repairs / monies spent on the property ...eg new boiler etc etc?
As for legal proceedings I was going to allow 4 weeks for the distribution then issue a pre legal letter giving a further 7 days then issue a County Court Proceedings Claim - this is the last resort!!!! .....although I can see this being strung along!d
Would you say this is reasonable?
Thanks

[SPQR]

Re: Executors duty to pay out funds to trustees

I would estimate the difference in valuation would be £20k over the 7 years - would this still be taxable? What about the repairs / monies spent on the property ...eg new boiler etc etc?

The tax issue is complicated - I would need to know far more information even to give a reasoned guess.

As for legal proceedings I was going to allow 4 weeks for the distribution then issue a pre legal letter giving a further 7 days then issue a County Court Proceedings Claim - this is the last resort!!!! .....although I can see this being strung along!d
Would you say this is reasonable?

Personally I think that 4 weeks for a full distribution of the estate is too short - and there is a real risk that the courts may see it as unreasonable (with cost implications). It took over 6 months for the estate of my Grandmother to be sorted - she was in a care home with her house already sold, so that was a fairly straightforward probate.

In any event the pre-action protocols state that there should be 14 days after a letter before action to commence proceedings (longer in the case of professional negligence).

- - - Updated - - -

Hi the house the only asset was divided into 2 parts - my mum who died 8 years ago her will50pc of the house was to be divided between myself , brother and 4 grandchildren 3 under 21 - my brother has probate and one of two executors not me.

I have a major concern with the facts here: it is not certain that the gift in your mother's will (the purported grant of half the house between yourself, your brother and four grandchildren) is valid.


Property held as beneficial joint tenants is excluded from the succession estate and cannot be gifted by will (even if the will expressly refers to it). So if you mother and father's home was in their joint names, then (normally) on your mother's death her share in the house would pass to your father in accordance of the doctrine of survivorship (rather than being passed by will).


If that is the case then the whole of the house has to be distributed in accordance with your father's will.


You will have to check with the solicitor if this is the case.

[des8]

Re: Executors duty to pay out funds to trustees

[QUOTE=SPQR;544366


Property held as beneficial joint tenants is excluded from the succession estate and cannot be gifted by will (even if the will expressly refers to it). So if you mother and father's home was in their joint names, then (normally) on your mother's death her share in the house would pass to your father in accordance of the doctrine of survivorship (rather than being passed by will).
[/QUOTE]

As there had been no comment about the right of survivorship, and it has presumably not been mentioned by Ispeakmans solicitor I assumed his parents held the house as tenants in common, in which case the mother's will is effective.
We need clarification.

[lspeakman]

Re: Executors duty to pay out funds to trustees

The value of the estate is only 130k so no inheritance tax involved. My brother obtained probate for mums side 7 years ago - I obtained probate in February for dad's side - I can scan and send both copies of the wills if you send me a e mail add - there are no other assets /debts.
so to clarify the property has been sold 50pc of proceeds to myself and the other 50pc being sent to my brothers solicitor for distribution back to myself and sons. So can I quote the under 21 rule and my youngest obtain his share ?
thanks

[SPQR]

Re: Executors duty to pay out funds to trustees

The value of the estate is only 130k so no inheritance tax involved. My brother obtained probate for mums side 7 years ago - I obtained probate in February for dad's side - I can scan and send both copies of the wills if you send me a e mail add - there are no other assets /debts.
so to clarify the property has been sold 50pc of proceeds to myself and the other 50pc being sent to my brothers solicitor for distribution back to myself and sons. So can I quote the under 21 rule and my youngest obtain his share ?

We don't need to see the wills to advise. Instead its a property issue as to how the house was owned immediately before your mother died (the wills will not tell us). This is only something the solicitor could advise on, and you'll have to seek clarification from him I'm afraid.

Yes you can quote the Saunders v Vautier rule so that anyone aged 18 or above can get their share.