Dealing with debts and next of kin.

securityguy

"Am I the person who has to officially deal with my mums estate? and if I am what is it that makes me the main person officially, is it because I registered her death or is it because I informed the bank of her death and they transferred her funds to my account?"

No one _has_ to deal with anyone's estate. You can be the only child of a widow, shrug your shoulders and walk away, and this forum would advise you to do that (well, not the shrugging part) when an estate is clearly insolvent (has more debts than it has assets).

However, once you start dealing with an estate, you have to see it through, although I'll define "have to" in a moment. Opinions vary, and you will get varying opinions in this forum, but there are a variety of acts which constitute what is called "intermeddling" and once you have done one of those acts, you're committed to being an executor (and I'll define "committed" in a moment, too).

Informing banks probably isn't (again, opinions vary, but the law is relatively clear). Informing utilities probably isn't. Having the balances of bank accounts transferred into your sole name account absolutely is, so there is no doubt that you have intermeddled and are now an executor.

The issue of "have to" see it through, or being "committed" to seeing it through, is one of responsibility, not of fact. There may be several executors, appointed by a will or by an application for letters of administration if someone is intestate. Once you have intermeddled, even if you step back and get another executor to do the heavy lifting, you are still personally responsible for it being done properly; you can't blame the other executors. You can go "powers reserved" and leave the work to another executor, but you can only get rid of your responsibility for any problems by renunciation, which is almost impossible if you have intermeddled (and that is where the precise definition of intermeddling starts to keep lawyers in work).

So I'm afraid you are probably stuck with the responsibility. Others with more experience will be along to tell you about the preference of payments.

TW1234

You do not need to rush to pay any debts or invoices.
The role of the executor is to first gather in any assets of all types (bank, insurances, cash, jewelry etc, as you have done with the bank account) and to determine all outstanding debts, etc due to any creditors.
Only once that has been done with reasonable certainty should any payments be made. (except for the allowable funeral costs.)
It would be fool hardy to pay any debts, including those with priority, on a first come first served basis, as you would be liable personally for any with priority that were not paid, perhaps by turning up later.
Only after it has been determined whether the estate is insolvent, should any payments go out, and these must be made in order of priority until the point at which there is insufficient to pay the others is reached.. The next group by priority should then be paid a proportionate amount of the residual assets based on the relative values.
If you are confident about the situatiuon that will ultimately arise, it is possible to pay those debts which would definately ultimately be paid and some "on account" to those where there remains doubt.
It is not unreasonable to take 6 months to a year before starting any distribution.
Do keep records , though, and keep all assets that you receive separate from your personal money or accounts.

Yorkshireman99

securityguy wrote: »

"Am I the person who has to officially deal with my mums estate? and if I am what is it that makes me the main person officially, is it because I registered her death or is it because I informed the bank of her death and they transferred her funds to my account?"

No one _has_ to deal with anyone's estate. You can be the only child of a widow, shrug your shoulders and walk away, and this forum would advise you to do that (well, not the shrugging part) when an estate is clearly insolvent (has more debts than it has assets).

However, once you start dealing with an estate, you have to see it through, although I'll define "have to" in a moment. Opinions vary, and you will get varying opinions in this forum, but there are a variety of acts which constitute what is called "intermeddling" and once you have done one of those acts, you're committed to being an executor (and I'll define "committed" in a moment, too).

Informing banks probably isn't (again, opinions vary, but the law is relatively clear). Informing utilities probably isn't. Having the balances of bank accounts transferred into your sole name account absolutely is, so there is no doubt that you have intermeddled and are now an executor.

The issue of "have to" see it through, or being "committed" to seeing it through, is one of responsibility, not of fact. There may be several executors, appointed by a will or by an application for letters of administration if someone is intestate. Once you have intermeddled, even if you step back and get another executor to do the heavy lifting, you are still personally responsible for it being done properly; you can't blame the other executors. You can go "powers reserved" and leave the work to another executor, but you can only get rid of your responsibility for any problems by renunciation, which is almost impossible if you have intermeddled (and that is where the precise definition of intermeddling starts to keep lawyers in work).

So I'm afraid you are probably stuck with the responsibility. Others with more experience will be along to tell you about the preference of payments.

By drawing the cash out the brother has intermeddled though the OP has not. Really the OP would be well advised to do nothing and let the brother takes the consequences. The OP has no legal obligatuion to do anything. This may sound harsh but it will save the OP a lot of trouble.

Yorkshireman99

TW1234 wrote: »

You do not need to rush to pay any debts or invoices.
The role of the executor is to first gather in any assets of all types (bank, insurances, cash, jewelry etc, as you have done with the bank account) and to determine all outstanding debts, etc due to any creditors.
Only once that has been done with reasonable certainty should any payments be made. (except for the allowable funeral costs.)
It would be fool hardy to pay any debts, including those with priority, on a first come first served basis, as you would be liable personally for any with priority that were not paid, perhaps by turning up later.
Only after it has been determined whether the estate is insolvent, should any payments go out, and these must be made in order of priority until the point at which there is insufficient to pay the others is reached.. The next group by priority should then be paid a proportionate amount of the residual assets based on the relative values.
If you are confident about the situatiuon that will ultimately arise, it is possible to pay those debts which would definately ultimately be paid and some "on account" to those where there remains doubt.
It is not unreasonable to take 6 months to a year before starting any distribution.
Do keep records , though, and keep all assets that you receive separate from your personal money or accounts.

Very bad advice indeed. From what the OP has said the estate IS insolvent. By doing the things you suggest the OP will end up being personally liable.

TW1234

" I informed the bank of her death and they transferred her funds to my account."

Too late. So the advice seems OK to me.
Will not be personally liable if he follows it and does it correctly.

(Yorkshireman--OP says he has £2000 of estate in his own account---not brother)

Jackieboy

jay213 wrote: »

Thanks for the advice and information so far. Things have cooled down a bit for now and my brother has become more understanding of dealing with this after going through things with his gf.

Now the next things I'm trying to work out are.

Am I the person who has to officially deal with my mums estate? and if I am what is it that makes me the main person officially, is it because I registered her death or is it because I informed the bank of her death and they transferred her funds to my account?

I ask this as I'm paranoid about unexpected things popping up in the future or doing things wrong and getting chased in the future. I have not gone to court or anything to get any sort of title.

My main intention with regards to the bank was to get money towards the funeral costs, and originally they said to bring in an invoice from the funeral directors which I was happy with, but a week later they sent me a letter saying that my mums accounts had been closed and transferred to me as they asked for someones details whilst filling in / signing bereavement paperwork.

The only money that has been touched was for the funeral and then about a further £250 towards costs for the wake/funeral. My mums estate will likely be insolvent and I think the two boded below will apply to her, not sure about the last one listed as that could apply to catalogues I guess? but they say you go down the list before moving to the next so she will be insolvent when reaching "unsecured creditors".

Secured creditors
The funeral expenses
Testamentary expenses
Preferred debts and Preferential debts
Unsecured creditors - e.g. debts to local and central government. utility bills, bank loans, credit and store card debts.
Interest due on unsecured loans.
Deferred debts

If I have to deal with this how do I go about working out who to pay? Looking at her final statement she was paid by DWP on the day she died and then 3 days later by 2 different departments. I've phoned both but they just said we would have to wait to receive letters in the post. ther was also child tax credit received 3 days after her death we phoned them and they said we would have to wait for some sort of declaration that's produced at the end of the tax year (which could be received from April - July).

Then there's a council tax bill, that asked for a small payment last month that's not been paid yet, but the total was around £650. That's the only new bill since my mums death that I think we have had, so do I pay this or not? and then there's utility bills, my brothers gf phoned them so I'm not sure what's going on with that but I think that was over £2000.

So, I'm thinking if I start paying these bills for my mums estate, all the money will be gone by the time I even get the letters from the DWP, HMRC, etc.... and then, if that's the case what happens?

I think I missed that there was a dependent child in the situation - where does s/he fit in?

jay213

Jackieboy wrote: »

I think I missed that there was a dependent child in the situation - where does s/he fit in?

One of my sisters, she is 16 and in full time education.

Savvy_Sue

Would it be sensible to transfer the money paid into your account from Mum into a new account, so that you are not tempted to regard it as 'yours' and can document exactly what's gone in and come out? Under the circumstances, I'd be tempted to ask for it to be called 'Estate of OP's Mum', make it a joint account with a sensible sibling (hoping you have at least one!) and only allow withdrawals on two signatures. I might also transfer the whole amount, and then reimburse myself the funeral costs if I'd paid them, just to keep it all really really clear.

Someone will say if that is not a good idea.

Also is anyone still living in Mum's house? You really need to let Council Tax know ASAP what that situation is: the bill may be adjusted / reduced because it is calculated on a daily basis.

And finally, anyone who comes chasing for money, write back and say that you believe the estate is insolvent, and no debts can be paid / distribution can be made before that is determined, which may take some time so back off ... Don't give a phone number!

jay213

Hi, thanks for the advice, I guess I could set up another savings account with my bank? as I don't think they would let me set up one in my mums name.

I was also wondering can I use money from my mums estate to buy a headstone? (I know you have to wait a year to put it on, but could I buy it now?) no money left over after funereal expenses and associated costs has been paid out yet. She had a final Council tax bill is that a priory to be paid? I know I found a list of tiers of people to be paid but all the creditors are in the same tier "Unsecured creditors - e.g. debts to local and central government. utility bills, bank loans, credit and store card debts".

How will, who get's paid what, be worked out and by whom?

If I take off or put to the side possible benefit over payments and my mums final council tax bill, there's just over £1000 left. If I get a headstone (if I can?) there will be less than £1000 left to pay other outstanding creditors, unless the above benefits and council tax don't take priority and there's some other sort of formula???

Another question I just thought of, can utility debts pass on to relatives staying in the house?

Yorkshireman99

jay213 wrote: »

Hi, thanks for the advice, I guess I could set up another savings account with my bank? as I don't think they would let me set up one in my mums name.

I was also wondering can I use money from my mums estate to buy a headstone? (I know you have to wait a year to put it on, but could I buy it now?) no money left over after funereal expenses and associated costs has been paid out yet. She had a final Council tax bill is that a priory to be paid? I know I found a list of tiers of people to be paid but all the creditors are in the same tier "Unsecured creditors - e.g. debts to local and central government. utility bills, bank loans, credit and store card debts".

How will, who get's paid what, be worked out and by whom?

If I take off or put to the side possible benefit over payments and my mums final council tax bill, there's just over £1000 left. If I get a headstone (if I can?) there will be less than £1000 left to pay other outstanding creditors, unless the above benefits and council tax don't take priority and there's some other sort of formula???

Another question I just thought of, can utility debts pass on to relatives staying in the house?

The debts take priority over a headstone so forget that unless you can pay yourself. You need to get some professional advice from the CAB or a solicitor. You and your bother may end up liable for the debts.