Probate

 

Introduction

 

When a person dies, someone has to deal with their affairs and administer their Estate.

 

We will do our utmost to take over the administrative burden with as little fuss and bother as possible.

 

The purpose of this guide is to outline in very simple terms what is involved in obtaining a Grant of Representation and administering an estate.

 

What is a Grant of Representation?

 

A Grant of Representation is an order issued by one of the Probate Registries of the High Court It confirms or confers the authority of the "personal representatives" (i.e. the executors or the administrators) to administer the estate of the deceased person. 

 

There are three types of Grant of Representation:

 

(i)  Grant of Probate:  This is issued if there is a Will. It confirms or "proves" the authority of the executors appointed by the Will.

 

(ii) Grant of Letters of Administration with Will annexed: This is issued when there is a Will, but there is no executor named in the Will or all the named executors are unable or unwilling to act as executors.

 

(iii) Grant of Letters of Administration:  This is issued when there is no Will (which is known as being "intestate").  The persons who obtain a Grant of Letters of Administration are known as administrators and must establish their entitlement to apply for a Grant.

 

The duty of the personal representatives (PRs) is to administer the estate.  This includes, but is not limited to, collecting in all the assets, settling all debts and then distributing the rest of the estate in accordance with the terms of the Will or the rules of intestacy. 

 

It is normally not possible to collect assets (apart from joint assets which pass automatically to the survivor) or to pay liabilities of the estate out of the assets of the estate until the Grant of Representation has been obtained.

 

Some banks may agree to pay funds from a deceased account to a PR without a Grant of Representation. This is normally where the account balance is only a couple of thousand pounds but note that each financial organisation operates their own minimum limits.

 

As a rule of thumb a Grant of Representation will be required where the deceased has left more than £5,000, stocks or shares, a house or land or certain insurance or assurance policies

 

What is needed to obtain a Grant of Representation?

 

The PR’s must swear an Affidavit for the Court.  The Executors must say that they are the Executors appointed by the Will.  The administrators must establish their entitlement to take out a Grant. 

 

The personal representatives must state the value of the gross and net estate of the person who has died, and they must swear that they will ensure that his or her property will be distributed in accordance with the law and with the Will if there is one.

 

We will need to ask you for details of all property and all debts of the deceased. 

 

Property will include houses, cars, furniture, bank accounts, savings, premium bonds, shares, life insurance policies, personal possessions, jewellery and anything else capable of being valued and transferred from one person to another. 

 

The liabilities may include a mortgage, outstanding bills, etc. and will also include the funeral expenses.

 

How is a Grant of Representation obtained?

 

An Oath for Executors or an Oath for Administrators must be lodged at one of the Probate Registries of the High Court together with an Inland Revenue account setting out all the assets and liabilities. 

 

Once the Registry accepts the papers, they will issue either a Grant of Probate or a Grant of Letters of Administration allowing the executors or administrators to administer the estate. 

 

This means, for example, that the Grant can be registered with building societies or banks in which the deceased held an account in his/her sole name.

 

Once registered, it will be possible for the account to be closed and the money transferred to the personal representatives, so that they can deal with it in accordance with the Will, or in accordance with the intestacy rules if there is no Will.

 

A final distribution of all the assets can only be made when all the liabilities, especially tax liabilities, have been ascertained and settled.  This can take some time, particularly where values are uncertain and have to be agreed with the Inland Revenue.

 

How long will this take?

 

The circumstances of each person are unique, so it is extremely difficult to predict how long it will take to obtain a Grant and to administer the estate. 

 

We will keep in touch with you from time to time in order to tell you the position we have reached and how matters are progressing.

 

It is not unusual for it to take up to a year, or perhaps longer if things are not straightforward.

 

Estates which are apparently simple can prove to be complicated and take much more time than is envisaged at the outset. Similarly, a large estate may prove to be straightforward.

 

Typical problems which may substantially increase the time taken are:-

 

the need to go through and sort out numerous old papers; searching for details of lifetime gifts which the deceased may have made; difficulty in realising assets or in settling tax or other liabilities; relying on third party organisations to provide relevant information within a reasonable timescale anything over this sum.

 

The children would get half the sum over £125,000 immediately and be entitled to the other half on the death of the spouse/civil partner. Should any of the children die before the deceased then the grandchildren would be entitled to take their parent's share.

 

If there is a lawful spouse or civil partner, no children, but there are parents/brothers/sisters/ grandparents/aunts/uncles and your estate is worth less than £200,000 then the spouse/civil partner gets everything. If the estate is worth more than £200,000 then the spouse/civil partner would get £200,000, plus a life interest in half of anything over this sum. The remaining half goes to the other relatives in this order of priority - parents; brothers/sisters; half brothers/sisters; grandparents; aunts/uncles; spouses/ civil partner of aunts/uncles.

 

If there is a spouse who is not lawfully married, but has had children then the estate will be shared between the children. Should they die before the deceased then their children would take their share.

 

If there is a spouse who is not lawfully married or a civil partner, and have no children, but there are parents/brothers/sisters/ grandparents/aunts/uncles the estate will be shared equally amongst them in this order of priority - parents; brothers/sisters; half brothers/sisters; grandparents; aunts/uncles; spouses of aunts/uncles. If any of these have predeceased, but have living children then the children will take their parent's share. 

 

If you are not lawfully married, and no other relatives can be traced then the estate will go to the Crown 

 

These rules on intestacy do not recognise "common law" partners, and that "children" includes natural, adopted and illegitimate children, but excludes step-children.

 

Fees

 

It is very difficult to estimate the likely cost of obtaining a Grant of Representation and administering an estate. 

 

The main reason for this difficulty is that there is insufficient information at the outset as to the nature of the estate and the potential problems.

 

Our charges are calculated on a time-recorded basis, i.e. we charge the estate according to the amount of time spent administering the estate.

 

We have a computerised time-recording system which records the time spent by fee earners on any particular matter.

 

Each fee earner has an hourly rate which has been calculated in accordance with The Law Society’s published guidelines.

 

We also charge a value element in addition to charging for the time spent working on a matter.

 

The value element is calculated by charging a percentage of the value of the estate (1% of the value of the gross estate less residence and 0.5% of the  value of the residence). If we are appointed executors of the estate this increases to 1.5% and 0.75% respectively.

 

There will also be certain additional expenses (known as disbursements) such as Probate Court fees, statutory advertisements and charges for official copies of the Grant of Representation.

 

If for any reason this firm does not complete the work which you have instructed us to do, then a charge will be made in respect of the work which has already been completed. 

 

VAT would be payable on that amount and the estate would also be charged for any disbursements incurred.

 

While we have made every effort to provide accurate information, the law is always changing and affects each person differently. This introductionis no substitute for specific advice and we will not be liable to you if you rely on this introduction.