Who pays for the conveyancing?

Ames

Hi all, I've just got a bit of a niggle about something and wanted to check.

Background:

Mum died in 2011, no will. I'm administrator, my sister and I are the only beneficiaries.

We haven't been able to sell the house on the open market so sister has decided to buy me out.

All along the probate solicitor has said they'll do the conveyancing and the costs will come from the estate. At the last minute though they were too busy so I had to engage a conveyancing firm to deal with the sale.

I was surprised to be told a couple of weeks ago by the conveyancer that I'm personally responsible for her fees. She said if the house were sold on the open market it would come from the estate, but as it's my sister buying it I have to pay.

It seems strange to me that I have to pay to sell a house I don't own. But then I suppose it would be strange for my sister to effectively pay half the cost of selling it to herself.

As I said, I just wanted to check. I'm probably wrong though and I do have to pay - there's been a long list of things gone on that I thought were dodgy and it turned out to all be above board.

TIA

davidmcn

Ames wrote: »

It seems strange to me that I have to pay to sell a house I don't own.

You own half of the house. You're selling that half to your sister. If you're employing a conveyancer to act for you in that sale, you pay their fee.

If the conveyancer is also acting for your sister (is she?) then it would make sense for you to split the fees.

G_M

Not sure I agree, but I'm no probate expert!

Surely the Administrator can use money from the Estate to wind up the Estate? That would include transferring the property from the deceased name into the Beneficiaries' names, say A & B.

If one Beneficiary (A) is buying out the other (B), then the property would be transferred from the deceased to A, with the A paying B half the value of the property.

The Transfer (conveyancing) costs would still be paid by the estate (I would have thought).

booksurr

you say yourself that you are the administrator therefore is it really you the administrator that is paying or you as you?

I assume the estate has not actually been distributed to you the beneficiary?

if you the administrator, then the conveyancing fees are a cost against the estate. If the estate does not have sufficient cash to pay it then you and your sister as joint beneficiaries will have to put cash into the estate and adjust downwards your respective share of the value of the estate accordingly. If the estate comprises only the house and no cash then obviously that is a logistical problem solvable only by you and sister stumping up cash yourselves so in that sense yes sister should pay to buy from the estate (which to the layman may look like she is buying from herself)

Ames

Thanks for the replies, I'll try and clear up any confusion.

davidmcn wrote: »

You own half of the house. You're selling that half to your sister. If you're employing a conveyancer to act for you in that sale, you pay their fee.

If the conveyancer is also acting for your sister (is she?) then it would make sense for you to split the fees.

I think it's the 'you own half of the house' part that I'm struggling with - as far as other things are concerned, I don't own half the house, the estate owns all the house. It seems strange to me that in the sale I own half the house but not in all other aspects. For instance, the mortgage is owed by 'the estate', not by 'Ames'.

My sister has a different solicitor acting for her as purchaser.

G_M wrote: »

Not sure I agree, but I'm no probate expert!

Surely the Administrator can use money from the Estate to wind up the Estate? That would include transferring the property from the deceased name into the Beneficiaries' names, say A & B.

If one Beneficiary (A) is buying out the other (B), then the property would be transferred from the deceased to A, with the A paying B half the value of the property.

The Transfer (conveyancing) costs would still be paid by the estate (I would have thought).

There is no money in the estate, it's all the house. The house hasn't been transferred into any beneficiary names, as the estate can't be wound up (ie debts settled) until the house is sold - whether that's to Joe Bloggs who saw the for sale sign or my dad and sister.

The bit in bold is exactly what's happening (as far as I'm aware). The house is being transferred from 'Estate of Ames' Mum' to 'Ames' sister'. At no point does it become 'Ames'' house.

booksurr wrote: »

you say yourself that you are the administrator therefore is it really you the administrator that is paying or you as you?

I assume the estate has not actually been distributed to you the beneficiary?

if you the administrator, then the conveyancing fees are a cost against the estate. If the estate does not have sufficient cash to pay it then you and your sister as joint beneficiaries will have to put cash into the estate and adjust downwards your respective share of the value of the estate accordingly. If the estate comprises only the house and no cash then obviously that is a logistical problem solvable only by you and sister stumping up cash yourselves so in that sense yes sister should pay to buy from the estate (which to the layman may look like she is buying from herself)

According to the conveyancer, it's me as me that's paying her fees, not me as administrator. Which is why it seemed so odd to me. I gave her a list of debts owed by the estate and said 'oh and your fees need adding to that', to which she replied 'no, you pay me, it doesn't come out of the sale'. I said that the probate solicitor had said the conveyancing fees would come out of the estate which is when she said 'yes, if it were being sold on the open market, but as it's your sister who's buying you pay your own solicitors'.

As above, the estate hasn't been distributed to anyone. The house and all the debts are in the name of 'the estate of Ames' mum'.

I've been trying to think of it all in terms of there being three parties in everything - me, my sister, and the estate.

I do wonder if there's been some confusion and the conveyancer thinks that the estate has been distributed and therefore it's a sale from me to sister, rather from the estate to sister? But then, she knows that the mortgage and other debts are in the name of the estate not me and/or sister, and she's been liaising with the probate solicitor over it all.

booksurr

at the end of the day the conveyancer is only interested in making sure they get paid. It would appear they are aware there is no money in the estate so they are "steering" you

tell them they should bill the estate, not you, and then tell the probate solicitor to remind the conveyancer to do what the conveyancer's client, aka the estate, is instructing them to do - sell the house and bill their client!

if the house is valued at 100k and the conveyancer bill is £500 then you as beneficiary get, in cash, half of the value of the house (50k) less £250. Your sister gets to own the whole of the house having paid into the estate half of its value (50k) plus £250. So as beneficiaries you and sister end up identical, you get £49,750 in cash as beneficiary and she (as purchaser) pays out £50,250 in cash to buy your share of the house meaning her own share (as beneficiary) is also "worth" £49,750

therefore the estate gets the cash to pays its bills, you the beneficiary "fund" half of the fees as does your beneficiary sister. It is the probate solicitor who should be arranging this, not the conveyancer, they have nothing at all to do with it

Ames

Thanks everyone, I've emailed both the conveyancer and probate solicitor together asking for clarification and saying I believe the fees should be paid by the estate.

TBagpuss

The estate is liable for the costs . You as administrator for your mum are responsible for ensuring that the fees are paid from the estate.
As adminstrator you may be personally liable if the estate cannot pay.

You may need to speak to your sister to ensure that when the price she is paying for the house it is taken into account that the amount she will need to pay is not 50% of the value of the house but 50% of the value of the house + 505 of the costs to the estate of dealing with the administration, including the probate solicitors costs, conveyancing costs, funeral expenses and any other costs which have been incurred.

Ames

Just had this reply from the conveyancer

Unfortunately, you are paying your legal fees for the sale separately and not out of the estate. Your buyer will be paying their own legal fees.

Not sure how to reply?

Ames

TBagpuss wrote: »

The estate is liable for the costs . You as administrator for your mum are responsible for ensuring that the fees are paid from the estate.
As adminstrator you may be personally liable if the estate cannot pay.

You may need to speak to your sister to ensure that when the price she is paying for the house it is taken into account that the amount she will need to pay is not 50% of the value of the house but 50% of the value of the house + 505 of the costs to the estate of dealing with the administration, including the probate solicitors costs, conveyancing costs, funeral expenses and any other costs which have been incurred.

As I understand it, my sister's buying the house for £145k. The debts to the estate come out of that and what's left is split 50-50.

Although as she can only get a mortgage of £100k, her share will be reduced by 45k.

Gwhiz

Is this being made unnecessarily complicated?

The fees are so small in the grand scheme of things AND it's a transaction between brother and sister.

Would it just not be simple all round to split the costs? Forget what should/could happen and focus on doing the right thing all round.

Or am I missing something.