Living with Partner - Buying New House..Advice Please

RobS77

sloughflint wrote: »

Yes, I had noted the dementia and realised the life interest would only be on the husband's share. But my belief was that the life interest would make the wife's share valueless when it came to LA financial assessment for care fees.I based my comment about the whole house being protected on that fact.

Absolutely, but can the husband not write his will in this way if he so wished? The wife is still residing at the property.( Not even sure if that matters)

Would be interested in your thoughts.I'm not remotely interested in care fee planning by the way. It's just things I've happened to pick up over the years.

Interesting thoughts, cheers for that. This forum is great by the way: I stumbled on it by accident looking for info on mortgages a few weeks ago and couldn't resist dropping into this place! I personally think that John Pierpoint chappie missed his true vocation by not being a tax lawyer!

Off the top of my head, I am not sure re the LA assessment- will have a chat to a colleague who specialises in arguing with such people about the assessment side when I have a chance next week and then get back to you. If wife is residing at property still I think you may well be right, but will need to check that.

If husband wants to write Will then I agree, he is able to do that, you would draft it to include all his interest in the property, legal and beneficial etc.

I am interested in this, but that is due to being a sad geek rather than anything else..........

Cheers.

wise_fool

RobS77 wrote: »

Hey Wise fool: as you are keen on quoting my posts out of context, I thought I would borrow one of yours:

I have only quoted your exact words - what have I quoted that is inaccurate then?

So to clarify - you have been a private client solicitor for "7 or 8" years. You agree that high street solicitors shouldn't be getting involved in "complicated wills". Your firm has 4 STEP members so you are real specialists. Any of that inaccurate? Perhaps you might confirm if you are STEP qualified?

RobS77 wrote: »

You also don't state what sector of law you work in, and have ignored my previous question, as to whether you are a solicitor, which I find a little strange. Why the reticence- do you think I am an internet "groomer?" In which case don't worry, I don't think you are really my type.

I am only a humble person Rob so I don't like to say. I would agree that if our paths collided you would probably view me as unfit to tie your shoelaces - but really I am not a bad catch. I am sure beneath that arrogance and pomposity of yours lies a real p...y cat. But enough flirting - back to this will issue.

RobS77 wrote: »

I would advise the client to sever the joint tenancy and put the half-share of the property into a full discretionary trust incorporated in the Will.

So his half share is protected, hers will be claimed by LA. Clear enough? Clearly, his Will would not affect her half-share, but by severing you ensure it doesn't all go to wife to be claimed in care home fees by LA.

So on your figures, the £250,000.00 is protected, presuming property is then sold, it can be held on trust and assets managed for wifes benefit for her lifetime, then appointed out after death.

Clear enough?

If the client doesn't want a trust within the Will, then LA gets the lot- his call.

Yes that's very clear - thank you. I somehow thought you would go for a discretionary trust. So you've written off trying to save the other 250k then? Not sure the relatives would thank you - though if you fill the client care letter with enough jargon they probably won't be any the wiser, so you might not need to dust down your PII policy.

RobS77 wrote: »

Interesting thoughts, cheers for that. This forum is great by the way: I stumbled on it by accident looking for info on mortgages a few weeks ago and couldn't resist dropping into this place!

Off the top of my head, I am not sure re the LA assessment- will have a chat to a colleague who specialises in arguing with such people about the assessment side when I have a chance next week and then get back to you. If wife is residing at property still I think you may well be right, but will need to check that.

I am interested in this, but that is due to being a sad geek rather than anything else..........

I think I would do more than chat to a colleague about this. You are in the business of protecting assets - a niche operator - not some high street cowboy.

I would agree this forum is very informative - and I detect you have toned down your pomposity a touch - that's good to see - as you could do worse than read a few threads about this subject. I seem to remember seeing some case law a while ago that might help you - call it legal research.

I don't think it's being a geek - I think it's called being well informed.

Baggysdad

Interesting thread - which proves that writing Wills is an art, not a science and more than one solution can be correct. Personally, in the example given, I think a Discretionary Trust and a Flexible Life Interest Trust would achieve the same thing for the client.

Anyway, to further an interesting discussion - and not to have a go at RobS77, I would like to throw the following two questions in his direction:

When drafting discretionary trusts in such circumstances, do you give the trustees powers to enable trust property to be occupied by a beneficiary of the trust?

Also, would your advice to draw up discretionary trust Wills be different if the value of the property was greater than £650,000?

I am going to print this thread off and add it to my CPD file!!!

B

wise_fool

Baggysdad wrote: »

Interesting thread - which proves that writing Wills is an art, not a science and more than one solution can be correct. Personally, in the example given, I think a Discretionary Trust and a Flexible Life Interest Trust would achieve the same thing for the client.

If by Rob's admission, a discretionary trust only safeguards half the house, I personally would favour the life interest on the grounds that you have a fighting chance of arguing the survivor's share of the house is worth next to nothing. Without divulging the case law to our learned friend - would you not agree?

RobS77

wise_fool wrote: »

I have only quoted your exact words - what have I quoted that is inaccurate then?

So to clarify - you have been a private client solicitor for "7 or 8" years. You agree that high street solicitors shouldn't be getting involved in "complicated wills". Your firm has 4 STEP members so you are real specialists. Any of that inaccurate? Perhaps you might confirm if you are STEP qualified?



I am only a humble person Rob so I don't like to say. I would agree that if our paths collided you would probably view me as unfit to tie your shoelaces - but really I am not a bad catch. I am sure beneath that arrogance and pomposity of yours lies a real p...y cat. But enough flirting - back to this will issue.

Yup- appoint out a life interest, if appropriate. Ok?

Yes that's very clear - thank you. I somehow thought you would go for a discretionary trust. So you've written off trying to save the other 250k then? Not sure the relatives would thank you - though if you fill the client care letter with enough jargon they probably won't be any the wiser, so you might not need to dust down your PII policy.

Hmm- not if the DT contains a power of appointment so that a LI can be granted? So all you have to do is get the Trustees to sign a deed I would have thought? Surely you appreciate that the law can change and so having the flexibility of a DT can cover this scenario?



I think I would do more than chat to a colleague about this. You are in the business of protecting assets - a niche operator - not some high street cowboy.

I would agree this forum is very informative - and I detect you have toned down your pomposity a touch - that's good to see - as you could do worse than read a few threads about this subject. I seem to remember seeing some case law a while ago that might help you - call it legal research.

I don't think it's being a geek - I think it's called being well informed.

Hi WF, if you think I have been pompous, please accept my apologies- I often post very quickly when I am at work as it gives me a brief break from work, and often get caught up in the spur of the moment: I think this forum is fantastic, and I have been reading this forum enthusiastically I can assure you, when a chance presents itself.

And no, if I have given the impression I am STEP qualified, I am only a mere student member. Although all my work before it goes out is checked/amended as required by a partner, all of whom are STEP members, so I have the benefit of being trained/supervised by people who are exceptionally good at their job, and I am very fortunate to be in a firm which does take this area of law seriously. The beauty of being supervised by people like that is they would kick me up the !!!! for any omission......... and then put me right- although those same STEP partners use the same precedents as me, which include a broad power of appointment that you apparently didn't realise was possible?

And I should point out I am far from the finished article- I am 5 and a half years qualified, the 7-8 years included my traineeship....... maybe I was trying to big up my experience? I am not quite that calculating about posts on forums, honest.........

RobS77

Baggysdad wrote: »

Interesting thread - which proves that writing Wills is an art, not a science and more than one solution can be correct. Personally, in the example given, I think a Discretionary Trust and a Flexible Life Interest Trust would achieve the same thing for the client.

Anyway, to further an interesting discussion - and not to have a go at RobS77, I would like to throw the following two questions in his direction:

When drafting discretionary trusts in such circumstances, do you give the trustees powers to enable trust property to be occupied by a beneficiary of the trust?

Also, would your advice to draw up discretionary trust Wills be different if the value of the property was greater than £650,000?

I am going to print this thread off and add it to my CPD file!!!

B

Yes, the precedent I normally use is from Butterworths for a lifetime trust includes the power to permit occupation of trust property- you can either do it by deed of appointment or resolution.

And yes, advice would almost certainly be different regarding a taxable estate: but I am off to the gym now so will post tomorrow!

RobS77

wise_fool wrote: »

If by Rob's admission, a discretionary trust only safeguards half the house, I personally would favour the life interest on the grounds that you have a fighting chance of arguing the survivor's share of the house is worth next to nothing. Without divulging the case law to our learned friend - would you not agree?

Hey WF, just had another think about this: the beauty of course about discretionary trusts is their inherent flexibility. So all you need to do is appoint out a life interest in the property to the surviving spouse if the case law at the time makes it in the Trustees interest to so do, and you get both protection of surviving spouses half-share, plus that of Deceased.

Thoughts?

RobS77

Baggysdad wrote: »

Interesting thread - which proves that writing Wills is an art, not a science and more than one solution can be correct. Personally, in the example given, I think a Discretionary Trust and a Flexible Life Interest Trust would achieve the same thing for the client.


Anyway, to further an interesting discussion - and not to have a go at RobS77, I would like to throw the following two questions in his direction:

When drafting discretionary trusts in such circumstances, do you give the trustees powers to enable trust property to be occupied by a beneficiary of the trust?

Also, would your advice to draw up discretionary trust Wills be different if the value of the property was greater than £650,000?

I am going to print this thread off and add it to my CPD file!!!

B

Cheers Baggys- you can of course grant a life interest under a discretionary trust if the power of appointment is properly drafted- so a DT would allow you to claim the relief IMHO. What do you reckon?

Baggysdad

If by Rob's admission, a discretionary trust only safeguards half the house, I personally would favour the life interest on the grounds that you have a fighting chance of arguing the survivor's share of the house is worth next to nothing. Without divulging the case law to our learned friend - would you not agree?

Depending on the powers given to the trustees of the discretionary trust, the discretionary trust could give exactly the same protection as a life interest trust. Unfortunately Robs response to my question on this matter referred to a Life Interest Trust, so I guess my answer is 'it depends'.

Maybe Rob can clarify his response to my question tomorrow when he comments on the situation if the value of the property is above the two Nil Rate Bands.

Also looking forward to seeing if Rob and/or his colleague(s) are able to work out the case law that enables an arguable case to be made that such trusts can protect the whole of a house from care fees.

Til tomorrow...

B

Baggysdad

Cheers Baggys- you can of course grant a life interest under a discretionary trust if the power of appointment is properly drafted- so a DT would allow you to claim the relief IMHO. What do you reckon?

I agree. I also reckon you can go the other way - appointing out of a life interest into a discretionary trust (or any other settlement) - or at least James Kessler reckons that you can.

The beauty of a life interest is that it doesn't run into problems if the estate of the first to die is greater than the NRB. The whole of the estate of the first to die can go into the trust - and thus be sheltered from the burden of the survivors care fees and it preserves the transferable nil rate band for use in the survivors estate.

It could be argued that if the estate is of such a size, protection from care fees may not be an issue - and probably it won't be - but I would rather factor in the option to protect as much as possible in a trust rather than factor it out.

But for estates below the NRB - and expected to remain below the NRB, then its 'swings and roundabouts' as to which trust is used - subject to the appropriate powers being given to the trustees.

B