Customer died. How does a company go about getting what they are owed? Is it Probate?

bobbentos

Hi all

Firstly, if I have posted this in the wrong section would somebody please move it to where it should be.

Secondly, I am asking this on behalf of my cousin who is a little too embaressed to ask for reasons that will become clear.

My Cousin runs a family business. For years he has dealt with a particular customer who each month ran up an account of £4,000. Every month the customer would pay the amount off with no problems. This went on for many years without a hickup and Cousin always received the £4,000 on time. However, just before Christmas the customer sadly & suddenly died. Cousin felt he couldn't ask the family at the time about the money owing because of the strong working relationship they had (Cousin even knows the wife of the customer). Well, now we are into the new year and cousin really needs the money now to pay his staff as things are tight in their industry at the moment. So, he has sent a few statements to the customers home(and business) address which have gone unanswered. Indeed, cousin phoned the customers wife who was still "too upset" to discuss the debt. So, Cousin spoke to the customers son (who is still trading with Cousin but now under a new name since his Dad died). The son told Cousin "It's all being dealt with by the solicitors. I don't really know anything". Cousin knows the Customer was well insured such was their strong relationship. Cousin also knows the customer's company was VERY solvent and trading well.

So, cousin is owed the money but doesn't know how to go about getting it back. If we knew who the "Solicitors" were, Cousin could write directly to them and ask them were they "Dealing" with the matter.

Where does Cousin go from here?
What are the legal channels when a business owner dies and there are suppliers still owed money?

Any help would be grateful.

Thanks all

kazwookie

Find out who the solicitors are from the son, next time he comes to trade with your cousin.

Then send a letter outlining the facts, / copies on invoices / other relevant information to the solicitor recorded delivery, and ask for an acknowledgement, sorting out affairs for the decease can take several months depending on how complex they are, so your cousin may have to wait some time.

bobbentos

Thanks Kaz. I think if he knew something was happening he'd have no problem waiting. But... He knows nothing, and the Son just says "The solicitors are dealing with it". Now, if I know solicitors they won't be in any rush to pay out!

nad1611

Usually the papers showing all assets and liabilities are collected together and passed to the Executors of the Estate (and it sounds like the Solicitors are in the role). From these papers the Executor will make a tally of the size of the Estate.
It's correct that the sorting out of an Estate can take a long time ayear or more in some instances and there is a priority list of who gets paid first so your cousin won't be at the top of the list but not too far down either and this list can only be sorted once they know the value of the assets, which does take time as Probate has to be applied for first.
Rest assured it would not be in the Executors interest not to pay out to someone to whom the deceased person owed money. The Executor would be held personal liable for any oversights. A notice in the London Gazette is usually placed for this very reason and it gives anyone who has a claim on the Estate the opportunity to make that claim. So if it came to it, your cousin could look out for the Notification.

However, I'm sure that the son could find out who the Solicitor is, I can't believe he doesn't know who the Executors of the Esate are, there's probably someone else in the family who might be a joint executor so someone will know the Solicitor's contact details , as much as it's a difficult time for the family and your cousins need for sensitivity,your cousin may need to be a little persistent in finding out the name.
Either way, he's going to need the name and contact details or look out for the Notification if all else fails.

In addition to the above. The Notification cannot be lodged until Probate has been granted and there is a certain length of time that creditors have to make a claim following a Notifcation. After which time the Executors have no liability.

MatyMoo

Was your cousin dealing with this person as an individual, sole trader or limited company as the way debts are dealt with can be different.

As an individual it would be via the executor.

As a sole trader the business dies with them and debts would become part of the estate (but makes it more complicated for an executor)

If it is a Ltd Co it could carry on (if there were other shareholders/directors) or be wound up (likely if it is owned by one person). You would need to know which was happening in this case.

suki1964

Seems like cousin is straying other the line of business and friendship

Your cousin needs paying - your cousin should be billing the deceased

If the NOK aren't forthcoming and getting the solicitor to liaise with you - then small claims or whatever is the usual route for non payment,

Obviously the customer is deceased and until probate has been passed nothing will be paid out - but your cousin needs to be notified that this is the case - not " its being dealt with"

nad1611

If the NOK aren't forthcoming and getting the solicitor to liaise with you - then small claims or whatever is the usual route for non payment,


This seems a little harsh in the circumstances. Worrying the family at this time with going to court. I'm quite sure that the family would want to pay any debts their father had, particularly if he'd been a long time customer of your cousin and it also looks like the son wants to continue business with your cousin too.

I would simply ask for the Solicitors details if he really doesn't know then ask him to find out who does, if that fails wait for the Notification. Also some Solicitors will do a search on money that the deceased owed, it costs about £25 I believe, so it could come up there if the debt has been declared.

DVardysShadow

At a minimum, the family should be advising contact details for the executors or solicitors and not being evasive about it. The risk with this is that the family get the probate done and the inheritance paid out making it even more difficult to reclaim the money. It then probably becomes a case of proving that the family knew of the debt to get the estate reopened.

I would suggest a polite letter to the 'Estate of the Late <Customer>' asking for details of who is dealing with the matter. Keep a copy.