LEGAL Newsletter: August 2023

August 2023 

The chain of representation

What happens if an Executor passes away?

The chain of representation refers to the legal framework that allows for the continuous administration of an estate after a death. This ensures that the estate is properly administered even if the Executor (the person dealing with the estate if there is a Will) or Administrator (if there is no Will) passes away during the process.

For example: John creates a Will appointing Sarah as his Executor. When John passes away, Sarah assumes the role of Executor and obtains a Grant of Probate in her name. However, before Sarah completes the estate administration process, she sadly passes away.

In her own Will, Sarah has designated Mark as her Executor. Mark steps in and takes on the responsibility of administering Sarah’s estate. According to the chain of representation, Mark can also act as the Executor for John’s estate and continue the estate administration process for both Sarah and John. Mark would need to present both Grants of Representation in order to complete the administration.

The chain of representation can extend further until it is broken, or the estate administration has been completed for all involved estates. To maintain this continuity, it is necessary to have a valid Will in place.

If the Executor dies intestate, meaning they did not leave a valid Will, it breaks the chain of representation. A chain of representation can also be broken if an Executor did not manage to obtain a Grant of Probate in their name before they died.

When the chain of representation is broken, the administration of the first estate reverts to the next of kin according to the rules of intestacy. They will need to begin the estate administration process again. This demonstrates the importance of having a valid Will in place, especially if you know you are named as an Executor in someone else’s Will.

Appointing assets or Trustees

What is a Deed of Appointment

A Deed of Appointment is a legal document by which an individual (or professional) is appointed a specific role or assets. In the context of probate and estate administration, this is mostly used to appoint assets out of a Trust to beneficiaries or assign a new Trustee. When there is a Trust in a Will, the assets within it will be handled by Trustees, rather than going directly to beneficiaries. The Trustees have the power to manage the distribution of these assets to beneficiaries.

Deeds of Appointment to allocate assets in a Discretionary Trust

Trustees have the power to transfer assets in a Trust to the beneficiaries. In a Discretionary Trust, they also have the responsibility of deciding how the allocated inheritance is distributed. For example, they may choose to pay the total amount in full or in instalments. To distribute these funds to the beneficiaries, Trustees will need a Deed of Appointment.

Deeds of Appointment to assign a new Trustee

It may be necessary to replace a Trustee or appoint an additional Trustee. This can occur when only one Trustee is named in a Will, as there should always be at least two assigned. Additionally, if a Trustee is incapable of continuing in the role, they may renounce. Continuing Trustees are responsible for appointing a new Trustee, and this can be done using a Deed of Appointment.

Deeds of Appointment provide evidence of the Trustees’ decisions. The Deed will include details of the beneficiaries and what they are receiving (if allocating assets) or provide names of the continuing, new, and renouncing Trustee(s) (if appointing a new Trustee).

Order of priority when there is no Will

The Statutory Legacy sum on intestacy

When someone dies without a Will (known as intestacy) in England and Wales, and have a living spouse or civil partner, the spouse/civil partner is entitled to everything in the estate if it is not worth more than £322,000. Joint assets pass by survivorship.

Statutory Legacy sum

When the estate is worth more than £322,000 and the person who died has children, the children will receive half of the remaining amount over the threshold, and the spouse/civil partner is entitled to the other half. For example, if an estate is worth £522,000 (in the sole name of the deceased), the spouse or civil partner would inherit £422,000 (£322,000 plus £100,000 from half of the remaining estate) and any children would inherit £100,000 split equally between them.

This is known as the Statutory Legacy sum. Previously, the sum was £270,000; if the death was between 6th February 2020 and 25th July 2023, this amount still applies. If the date of death is on or after 26th July 2023, the Statutory Legacy sum of £322,000 applies.

Order of priority

No matter the value of the estate, the spouse/civil partner inherits all the Deceased’s personal belongings when there is no Will. If the person who died did not have a spouse/civil partner but did have children, the estate would be equally split between them. After that, the order of priority is: living parents; full-blood siblings; half-blood siblings; grandparents; aunts/uncles; half-blood aunts/uncles. If a relative has died, their children are entitled to inherit.

Applying for a Grant of Probate

How to avoid a stopped Grant application

When applying for a Grant of Probate, there are often delays caused by the Probate Registry. However, further delays can occur when there are errors in your application. When there are mistakes that the Probate Registry must clarify, the application may be ‘stopped’ until the issues have been fixed. Common causes for stopped applications include:

  • Missing documents. Delays to Grant applications are caused when the required supporting documents are not submitted at the same time as the application. Power of Attorney and Inheritance Tax forms are reported as common missing documentation.
  • Missing Inheritance Tax (IHT) information. As IHT is administered by HMRC, it takes approximately 20 days for form IHT421 (if applicable) to reach HMCTS to process an application. If a probate application is received before this, the application will be delayed.
  • Missing Executors. Applications must include all the Executors of an estate, and it is a requirement to disclose why an Executor is not applying. For example, disclosing that an Executor has predeceased.
  • Queries about the Will’s condition. To mitigate the risk of fraud, staple holes, rips, missing pages, or stains may be queried.

If a Grant application comes to a halt for any of the reasons stated above, the application is submitted to an alternative queue until the required information or documentation has been submitted. To ensure this doesn’t happen, it’s important to double-check that you have proofread the details on the application, all Executors mentioned on the Will have been cleared off if they are not signing the application, the statement of truth forms have been signed, Inheritance Tax forms have been submitted (if applicable), and the probate fee has been paid (£273).

Information kindly provided by Kings Court Trust