Difficulties with co-executor of will

Feelingwideopen
Feelingwideopen Posts: 9 Forumite
edited 23 January 2011 at 7:25AM in Savings & investments
Any help or advice you can give is really appreciated. I am having difficulties with my brother who is co-executor of my Grandfather’s estate.

My Grandfather gave me £20k to “look after” for him to pay bills etc should his health decline. He retained around £10k in other accounts and a property worth £150k as his only other assets. I made my brother aware of this.

I put the funds in an account in my own name. During a period of falling interest rates I then moved this money, in tact, through several other accounts with various providers in pursuit of the best rate. With one bank I held around 20 different “jam jars” in my own name. The funds moved in tact through some of these buy because all these accounts have since been closed I don’t know which ones. Foolishly I checked closing statements for reasonability and, being paranoid about ID theft, shredded them.

My Grandfather asked me to share around £5k of the money with other family member as a gift from him and also to pay some bills with some of it. There was also the occasional other request for small gifts.

Rather foolishly, I documented nothing.

My Grandfather’s health declined and I made arrangements to pay other bills such as care home and property related costs.

When he died around £10k of the original £20k remained.

When we set about winding the estate up, my brother took charge of practical things like house clearance and I called in the funds from my Grandfather’s bank and building society accounts. I added the proceeds to the remaining £10k in an account in my name because trying to open a proper executors’ account with any bank had proved impossible.

We obtained probate based on the assets in my Grandfather’s name at the date of death (not including the £10k that remained in my name).

After a number of delays, we have now started to distribute the funds to the half dozen beneficiaries named in the will. There is no dispute as to who is entitled to what.

My brother has now made a demand for an audit trail of the funds entrusted to me by my Grandfather for the 18 months or so prior to his death. My record keeping is virtually non-existent and while doubtless I can obtain copy statements I’m not sure that I can recall what every payment was for. I have left myself quite exposed to allegations of theft during this period. While my brother hasn’t made the allegation, this is clearly where things are heading.

From death onwards, every transaction is clearly documented.

I have argued that it is unnecessary to rebuild the audit trail prior to death as arrangements with my Grandfather were informal and I was merely acting in good faith on his behalf. But the demands to provide the information on the accounts in my name continue.

I can’t undo my foolishness in my failure to keep proper records and would strongly recommend to others that they don’t inadvertently put themselves in the position I now find myself in.

While I can make the request for copy statements etc to the banks involved next week, and I believe the costs can be picked up by the estate, I won’t be able to 100% explain every transaction. Poor records, imperfect memory and excessive movement of funds in pursuit of a better return being the main problems.

What can I do?

Is this audit trail prior to death necessary?

At the moment I wish I'd just claimed the money was a gift and pocketed it for myself instead of returning it to the estate.
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Comments

  • martinman3
    martinman3 Posts: 727 Forumite
    edited 23 January 2011 at 10:52AM
    I should say that I am no expert in these matters and I am assuming that you and your brother are the only executors.

    If you were not an executor yourself then you would have cause to worry but quoting from the book I have on the subject "Co-executors have equal powers and none is senior to any other"

    Your grandfather appointed you as co-executor in his will because he trusted you, it seems that your brother does not. If he thinks that you have spent the money on yourself I would start by getting evidence of just how expensive the care home fees were. If you were given £20k, you can show that the bills and the gifts to family were approx £10k and you had £10k left I don't see how he could see that as a problem.

    The answer to why this is happening could be related to whether you were treated equally in the will.

    p.s. Is it your brother or a solicitor making the requests ?

    I should also add that you may get more help if you post in another area of the site such as the Moneysaving in Marriages, Relationships & Families http://forums.moneysavingexpert.com/forumdisplay.php?f=24
    Unfortunately, there is no specific forum for legal questions.
  • Feelingwideopen
    Feelingwideopen Posts: 9 Forumite
    edited 23 January 2011 at 10:54AM
    martinman3 wrote: »
    I should say that I am no expert in these matters and I am assuming that you and your brother are the only executors.

    If you were not an executor yourself then you would have cause to worry but quoting from the book I have on the subject "Co-executors have equal powers and none is senior to any other"

    Your grandfather appointed you as co-executor in his will because he trusted you, it seems that your brother does not. If he thinks that you have spent the money on yourself I would start by getting evidence of just how expensive the care home fees were. If you were given £20k, you can show that the bills and the gifts to family were approx £10k and you had £10k left I don't see how he could see that as a problem.

    The answer to why this is happening could be related to whether you were treated equally in the will.

    p.s. Is it your brother or a solicitor making the requests ?
    Yes, we are the only executors. The will make a slight differentiation in my brother's favour, but nothing significant.

    My problem is that it is all very approximate. My failure to keep records is scaring the hell out of me at the moment. If I'd simply left the money in a single account life would be a lot easier right now.

    It is my brother making the requests.

    Thanks for the reply.
  • nrsql
    nrsql Posts: 1,919
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    Another way of looking at it:
    Your grandfather made you a gift of £20k. You kindly paid for his expenses out of your own pocket and now want to pay £10k into the estate for distibution (from your own funds).
    Maybe it would be easier not to donate the £10k if your brother is making it difficult?
  • cloud_dog
    cloud_dog Posts: 6,026
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    nrsql wrote: »
    Another way of looking at it:
    Your grandfather made you a gift of £20k. You kindly paid for his expenses out of your own pocket and now want to pay £10k into the estate for distibution (from your own funds).
    Maybe it would be easier not to donate the £10k if your brother is making it difficult?
    Yes but....... I suppose the difficulty for the brother is that there isn't (???) any record of the original transfer, it could have been £30k, and also has the OP benefited in anyway from the money.

    The brother may just be trying to do things by the book but when it comes down to money it invariably gets messy.

    Unfortunately I think the OP needs to do what they planned, i.e. get duplicate statements and then hopefully most of the withdrawals are fairly obvious and the others will need to be validated.
    Personal Responsibility - Sad but True :D

    Sometimes.... I am like a dog with a bone
  • nrsql wrote: »
    Another way of looking at it:
    Your grandfather made you a gift of £20k. You kindly paid for his expenses out of your own pocket and now want to pay £10k into the estate for distibution (from your own funds).
    Maybe it would be easier not to donate the £10k if your brother is making it difficult?
    This is more or less how I've been looking at things. Naive, yes.

    Not "donating" the £10k? Tempting, but really not morally right. I never viewed the money as mine.

    Reconstruction would have been so much easier if this had been requested prior to us agreeing a probate figure (which this money was excluded from).
  • getmore4less
    getmore4less Posts: 46,882
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    IANAL but it look like this to me.

    It probably should have been treated as some form of trust or as a gift or as a cash asset.

    If a gift, when did you get the money, if less than 7 years ago it should have been include in some way on the tax return as a gift?

    If you are both happy you have not made a mistake and it does not form part of the estate then as an executor of the estate he has no legal right to request you do anything.

    Also all your payments you have been making now become gifts from your estate, if you wish to distibute the money in line with the will then hats your choice.

    If there should have been some sort of trust there might be income tax implications for the time you held the money

    If you decide you have made a mistake you may need help from HMRC on the implications for taxes.

    The probate should not be an issue, thye only care about the IHT due(still none) and if you are legaly entitled to be executors.
  • Mojisola
    Mojisola Posts: 35,551
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    As your Grandfather gave the money to you and it has been in your name, then it isn't part of his estate. You don't have to provide any record keeping to your brother.

    In fact, I don't see how you could account for it. You can't add something back into the estate after someone has died.

    The only problem that may arise from the gift is if your GF was claiming means-tested benefits after giving you the £20,000. After checking that none of it is going to be claimed back for over-payment of benefits, I would distribute the money as your GF wanted as a direct transfer from your account to theirs.

    You could point out to your brother that if you were really untrustworthy, there would only be about £50 left from the original £20k!
  • Feelingwideopen
    Feelingwideopen Posts: 9 Forumite
    edited 23 January 2011 at 2:51PM
    No issues with means tested benefits or IHT as a result of the transfer of funds.
  • theoretica
    theoretica Posts: 12,256
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    Can you go back to every bank you think this money passed through and request statements? I don't know if these would be covered by a SAR (which I think costs £10) or if you would need to pay whatever they wish to charge.
    But a banker, engaged at enormous expense,
    Had the whole of their cash in his care.
    Lewis Carroll
  • theoretica wrote: »
    Can you go back to every bank you think this money passed through and request statements? I don't know if these would be covered by a SAR (which I think costs £10) or if you would need to pay whatever they wish to charge.
    The answer I suppose is yes. The problem I have is that funds have passed through different current accounts and different savings accounts on their journey to being repatriated with the estate.

    Within one bank I jamjarred personal funds though a high number of accounts too. So identifying which account is which is going to be one hell of a job. Then identifying and recalling what the transactions were for ... nightmare!

    I'm liking the DPA idea to save on copy statement fees. That said, I really would prefer my brother not having the opportunity to trawl through my personal finances.
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