Inheritance Left in a Will, & Associated ‘Joint Account’ Holders

scream85

RE: Inheritance Left in a Will, & Associated ‘Joint Account’ Holders

Hi all,

Please accept my apologies if this is the wrong place to post this question, but this is the closest matched thread I could find to my topic.

Basically, my step granddad sadly passed away last month. He married my Nan 18 years ago, and when they married they BOTH wrote new wills stating that whoever died first, their assets (property and cash) would be split 50%/50% between each of their two children, i.e. his money would go to his two children, and her money would go to her two children. The only clause being that the house that they jointly owned would remain as it is and could not be sold until both of them passed away, and then it would be sold and split four ways. They decided to do this because they were both in their 70’s when they married, thus they didn’t want their money being split unfairly to either side of the new family just because they were married. Neither of them left any money to the other one in the event of a death.

When they wrote their wills neither of them expected to live for as long as they have. They both had in their minds that they would have 5 – 7 years together, but they went on to be married for 18 years before my step granddad sadly passed away. They were brilliant together and thought the world of each other. Hopefully that’s given an overview of the situation.

A year ago, my step granddad was worried that my Nan wouldn’t have enough money to pay the bills should anything happen to him (as he’d been ill), so he set up a joint account (with both his and my Nan’s name on the ‘joint account’) so that if anything happened to him Nan would have some money to help her out. He also gave her ‘Power of Attorney’ on the account, so that if he was incapacitated or lost his mind, the account couldn’t be frozen and she would still have access to the money.

When he sadly passed away, the money in this account instantly became Nan’s under the law in England named ‘The Last Survivor’, which clearly states that on the death of a joint account holder, the account is transferred to the sole name of the remaining account holder, and that money no longer forms part of the deceased’s estate. The above is exactly what happened – all of my step granddads accounts were frozen pending probate, and the joint account became Nan’s to which she can gain instance access to. This has been confirmed by the bank and ties up with the ‘Last Survivor’ law described above.

Now the problem.... my step granddads children are fuming about it and said that it is their money, and they are trying to force my Nan to sign it over. They have said that under probate the money is theirs because there is a form called ‘Notes to help you fill in form IHT205(2006)’, which within a section called ‘Valuing Joint Bank Accounts’ states:

“Valuing the deceased's share of a bank account is quite easy, as the example before shows. But sometimes an account may be held in joint names just for convenience. For example, if an elderly person can no longer get out, they may add a son or daughter’s name to their bank account so the son or daughter can operate the account for them.

If an account is in joint names for convenience and the deceased provided all the money in the account, you should treat the account as if it was in the deceased’s sole name. Include the full balance of the account in box 14.3 (for joint assets) or 13.1 (if the account was held as tenants-in-common). But the opposite also applies, and if the deceased did not provide any of the money in the account then, so long as the provider did not intend to make a gift, there is no need to include anything about the joint account on form IHT205(2006).”

As my step granddad provided ALL of the money in the account, his children are saying that it has to go on the probate form (which is correct, as stated above), but because it is stated on the probate form, they are claiming that it must therefore be part of his estate, and that his estate was left 50/50 to his children, thus the money is no longer Nan’s.

Is this correct? I can’t see how it can be? Also, what determines whether a joint account is one of ‘convenience’, because the example given above is of a son or daughter being a ‘joint account holder’ for their elderly mum or dad, who is unable to get to a bank easily, but they were both married and could both get to the bank?

My point being is that my step granddad specifically set the account up for the very reason that he wanted my Nan to have the money. The money in question isn’t a massive amount, and equates to a very small % of the overall estate (less than 10% of the estate overall), and his two children are getting the other 90% of it split between them, no questions.

I don’t think they have a right to the money in the joint account. My step granddad would have wanted my Nan to have it, and they are saying because of this probate form, it is legally theirs. They are being awkward and causing unnecessary aggravation, and are saying that if the money isn’t given back to them straight away they are going to contest it all, which is stress and hassle Nan doesn’t need. She would rather give the money to them than them cause trouble through the courts.

My question is ultimately, do they have a case or is it Nan’s money?

Please accept my apologies for such a long post, but it was very important to make ALL the facts known up front to receive an accurate response. I know we need to make an appointment with a Solicitor to get a definitive answer, but unfortunately I am over 250 miles away and can’t get there until the end of the week and was hoping for an ‘indicative’ response only, to help obtain a clearer understanding.

Thanks in advance to anyone who can help!

DUTR

Anybody can contest a will, but it sounds like they may not be succesful, this is one for a the law council more so than the opinion of the readers here.

Mojisola

No legal expertise and you should definitely take advice about this but my take on it is this:

The example they quote is not the same situation as a joint account held between spouses. The money belongs to the survivor - your Nan.

Tuesday_Tenor

I assume that you're saying that your grandmother's assets have run down a bit due to living longer than anticipated.

I assume the joint account was a completely new one set up a year ago, rather than his wife's name was added to an account which was previously solely his. If the latter, the children might have a stronger case for saying it was only added 'for convenience' of enabling HIS use of HIS finances through a third party (his wife) who was in a better position to draw moeny out for him, write cheques for him etc.

From what you describe, the elderly couple realised their slight mistake in their wills, not allowing for changed circumstances many years later >>>Neither of them left any money to the other one in the event of a death. They then took a very sensible step of setting up the joint account to address it.

It seems clear to me that stgrdad funded the account but it was with the full intention of the money being clearly 'jointly owned' and therefore 'gifted' for their joint use and ultimately for the use of the other partner when the first one died.

It was not for 'convenience' in the sense of the IHT guidance notes,

What a shame st-grdad's children are taking the attitude that they are. Can't they respect and value that this man wanted to make better provision for his elderly wife's needs, which surely had to be a higher priority than the children's inheritance. If necessary to meet his wife's needs he might have needed to put 90% into the joint account. They should be grateful that they still have the 90% left.

I hope this is backed up by the solicitor.

Savvy_Sue

You don't, of course, have to consult a solicitor local to Nan: your own local solicitor could be consulted if you have a copy of the will. If you're a member of a trade union you might be able to get half an hour free legal advice on the phone, although I wouldn't necessarily 'rely' on that advice, but it might confirm or deny our general feeling that the money IS your nan's.

However, my question would be, who is executor? Because although the executor has to follow the will, it's up to the executor to then sort it out, and beggar all to do with the beneficiaries until that has happened!

If Nan is sole executor, and I were Nan, I would be tempted to say "well darling stepchildren, this is far too difficult for me to deal with, I shall have to pass this over to a solicitor and let them deal with the estate. Of course that's going to cost a few thousand and it will probably take longer for you to get what's due to you, but if you want to pay for the privilege of being sure that the way your father wanted to provide for me is or isn't legal, that's your privilege. And of course you should take legal advice yourselves, and let the solicitors fight it out between them if they disagree, of course you'll have to pay for the advice you take up front, but any advice I take can I believe be deducted from the estate." And I'd buy them each a copy of that Dickens novel for Christmas - is it Great Expectations?

Meanwhile I'd use that money which was now in my sole name to ensure that the house was snug and warm and well adapted for my needs, and for anything else which I was sure my dear departed second husband would have done had he lived: new car if she drives, maybe?

Alternatively, and if she's a more gracious lady than I am, or there's a disagreement between her solicitor and their solicitor as to the rights of this situation, she could offer to re-write her will, specifically leaving what remains of that account on HER death to her stepchildren. Not that I would feel any particular need to keep that account in reserve for emergencies only!

However I would defer to any proper legal advice that either of those courses of action were not the right one!

heretolearn_2

It is very clearly your nan's. The examples they are looking at are completely different scenarios - where someone might be set up as a joint account holder but purely to enable the original owner to access their money (i.e. if you appointed a care home manager, neighbour, or relative so that they could go and get your money for you if you were housebound). It has no relation at all to the normal joint account arrangements, where the money is for the benefit of and belongs to both (as it is for your Nan), and the survivor owns the lot in the case of a death.

Don't let the nasty little swines bully your nan out of HER money.

I know older people have a fear of courts, but tell her that no solicitor in their right mind would act on this for them, as they don't have a leg to stand on. If they do find a solicitor who will do it, they can't win. She won't be 'in court' in a criminal sense for goodness sake, why is she going to cave in to a pair of thieves - and that is what they are acting as. It's her money, they are demanding she hands it over, they are the bad guys here.

Just a thought - why doesn't she transfer the money to a family member she can trust - you? - who can then give it back to her when the dust has settled. Then there's no point her harrassing her and you can tell them to jog off! (although this might raise IHT issues). Can the money be put into some sort of trust for her? Anything so she doesn't just give them a cheque to make them go away.

**curlywurly**

Savvy_Sue wrote: »

And I'd buy them each a copy of that Dickens novel for Christmas - is it Great Expectations?

Great advice Savvy! It's Bleak House. Anyone who is thinking of instructing a solicitor to litigate over an estate should def read it.

OP, what a dreadful situation. What sort of sum are we dealing with ? To bring a claim for a disputed estate (and see it through to trial) would cost £10,000s, possibly as much as £200,000, so unless we are looking at a lot more than that in dispute, any decent solicitor will tell them that even if they do have a case, it is unlikely to be worth it given the amount at stake.

I'd also just like to repeat advice above - many household insurance policies have a "legal assistance" aspect (usually up to £50,000) so it's worth investigating whether you can get the advice for free. But that policy might not kick in unless and until your relatives actually commence proceedings.

scream85

Thank you all for your kind advice. It really is much appreciated.

Curly Wurly: The amount of money we are talking about is really quite small. My step granddads estate is less than half the threshold for inheritance tax, and of that only 7% of that was in the Joint Account that my Nan now holds, so there would be no point fighting anything legally as it would cost way more. Thanks for your comments

heretolearn: Thanks for your comments, much appreciated.

Savvy Sue: His children are the executors so they are in sole control of sorting everything out. Neither my Nan or us have an issue with that side of things. Everything my step grandad owned (excluding the joint account money) is theirs, except the furniture in the house (which becomes theirs when anything happens to my Nan). My Nan is fine with this, we are fine with this. The only thing my stepgrandad wanted in addition to this, was that my Nan had this sum of money to help towards any care she may need in the future. As stated previously, the amount in question equates to around 7% of the total estate, thus the others will receive the remaining 93% split 50/50. Of course, part of this estate is half the house, which can't be sold until my Nan's passing, but there is also cash, which will be made available to them much sooner, and equates (even after spliting it 50/50) to far more than what my Nan has been left in the Joint Account. Thanks for comments and advice, I really appreciate it

Tuesday Tenor: Yes the account was only set up a year ago. I'm not sure if it was a completely new one or not. With regards the convienience bit - both my nan and step grandad both went to their banks weekly to pay bills etc. Both were able bodied, albeit a little frail in their old age. It was only 2 weeks before my step grandads death where he was unable to leave the house unaided, so in that regard he could have sorted his own finances prior to this at any opportunity, by booking a taxi and going into town on his own. In all honesty, if I didn't think my step grandad wanted my nan to have the money I would tell her to give it back to her, but I know he wanted to have it, and thats why he specifically set the account up with the money, and I always believe that the deceased's wishes should be granted in these circumstances. Thanks again for your help and comments

Mojisola: Many thanks for your comments, much appreciated.

DUTR: Thanks for comments, much appreciated

Many thanks to everyone, I am trying to seek legal advice today to try and get a better understanding!

dzug1

Your nan is entitled to change her will to leave whatever is her own to whoever she wants.

I'd be tempted to suggest that if the family persist she will do so and leave everything to charity.

**curlywurly**

dzug1 wrote: »

Your nan is entitled to change her will to leave whatever is her own to whoever she wants.

I'd be tempted to suggest that if the family persist she will do so and leave everything to charity.

This is a very good point. From what I've read, I don't think OP's nan would want to change her will to leave everything to charity, but she may be able to change her will to leave the property (which I assume is now hers) to OP's side of the family. It would depend on how the wills were set up (there are some minor circumstances - "mirror wills" - where the survivor can't change some of the privions) and also on how the house is held.

So, depending on that, the other stepchildren could perhaps be told to suck it up or risk losing a lot more. In turn, that depends of course on whether it is important to preserve the relationship.

OP, I suggest that when you see the solicitor you should find out what your nan's options are with the remaining estate, because if it is possible for her to change her will now, she may well get the last laugh and your relatives may end up wishing that they had acted more fairly and more delicately at a time which must be very distressing for you all

Mojisola

As his children are the executors, they will probably go ahead with filling in the probate form as they feel justified in doing so and will take possession of the account. It will be left to your Nan to challenge the executors' decision.

Assuming the bank is still allowing your Nan access to the joint account, I would move most of the money into an account in her name. If it's not available to them to share between themselves, they will have to pay to legally challenge her action.