Named assets in will

securityguy

Keep_pedalling wrote: »

Although those disinherited would likely challenge the decision to sell their particular property to the benefit of someone else, which probably explains the involvement of very expensive barristers. Shades of Jarndyce v Jarndyce hang over this one.

In the absence of complicating factors they don't have a leg to stand on. Legal actions of the following form will fail: "A owned objects 1 and 2. A had a will which left object 1 to B and object 2 to C, with the residue including all monies going to D. A sold object 1. A died. B now claims that they have an interest in object 2, or that the sale of object 1 was invalid, or that the sale price should come from D's residue to them, or something".

The problems arise when (for example) the residual beneficiary also holds a power of attorney and conducted the sale. Then it can be argued that they have acted unreasonably, although the argument will be extremely messy. Before the death of the donor, attorneys no more have an obligation to protect the value of an estate for the benefit of beneficiaries than does the donor (edit to add: which is no obligation at all. For clarity, that something is named in a will imposes no obligation at all on the owner as to its care, disposal or destruction). They have a fiduciary duty towards the donor, and more generally they cannot unjustly enrich themselves, but liquidating assets to fund care (for example) is an entirely reasonable thing for an attorney to do, and they are _not_ obligated to consider the interests of beneficiaries in a will.

Indeed, I hold PoA for several people and not only do I not know the contents of their wills, I have no interest in learning it. In one case I am probably the residual beneficiary, but if in the process of acting for the living donor I sell something which turns out to be a specific legacy, and that causes a legacy to fail, that isn't my problem. Even if I did know the contents of the wills, and this situation arose, it would have to be shown that I acted unreasonably and not in the best interests of the donor.

Attorneys do not have a duty of care to potential beneficiaries, and it's only if they engage in transactions which are clearly intended to advantage themselves and have no justification for the donor that they are in the legal spotlight. The wise attorney, in my view, will make sure that they do not know the contents of the will, so the accusation cannot arise.

getmore4less

The rules for abatement are fairly clear

plenty of on-line references to how it should be done.

vigman

securityguy wrote: »

I think we can with pretty high certainty say that the only people who will benefit from this shambles are m'learned friends.

.... And HMRC!

vigman

Keep_pedalling wrote: »

Was the person responsible for selling the property for nursing home costs, going to inherit one of the other properties?

Yes but it was a family decision when all children were alive

Vigman

vigman

Malthusian wrote: »

Having read a couple of the OP's other threads I withdraw my question.

This is clearly a situation which is not going to be sorted out by asking a few exam-type questions of the form "if A left X to B and Y to C but C already died intestate having adopted D" on the Internet.

My only question now is where the OP stands in all of this. Is he A, B or C? If none of the above then why is he getting involved in this mess?

There are indeed multiple complications. However specific points have been clarified by asking 'exam like questions' such as grandchildren gaining the inheritance of their deceased father unless specifically excluded in the will

I am married to one of Mr X's children. There are more children and properties than in my examples with some named properties being left to named children (two of whom have died prior to MrX)that have been sold for nursing home fees in Mr X's lifetime and are now being sold for IHT, IHT interest and legal fees after his death

I really appreciate any clarification on specific matters by members of the group especially as I have serious health problems.

Vigman

securityguy

So, as an example.

Alice, a widow, has a will which leaves her holiday house to her brother-in-law Bob and the residue to be split between Alice's children Carol and Dan, and a lasting power of attorney making Carol and Dan joint and several attorneys.

Alice falls ill and requires long-term residential care, which has to be funded given her level of assets. She is expected to live for some years. Her house is in poor repair and is likely to be difficult to sell in the short term.

The holiday home is easy to sell: it's been used intermittently by Bob since Alice's husband died so has been maintained, but contains only basic furniture of little value and is in a desirable location where such properties sell almost instantly. The attorneys sell it with the intention that the money is used to for care expenses. They give Bob first refusal, but he does not have enough money. He mutters about how Alice always said she would leave it to him.

Shortly afterwards, before the money runs out, Alice dies of a heart attack, unrelated to the reason she was in long-term care.

Who gets the money? The answer is, in general, Carol and Dan. Could the attorneys have acted differently to protect Bob's interests? Yes. Was their behaviour reasonable, in the absence of Bob's long-term interest? Yes. Would a reasonable attorney, given the facts of the situation but no knowledge of the will, have behaved in the same way? Yes. Would a reasonable attorney, given a copy of the will naming Bob, have behaved in the same way? Yes: their duty is to Alice, who needs to money for care, and they have no duty to Alice's inheritors. Was their behaviour in Alice's best interests? Yes. Could they have done things differently? Probably, but the point is that they did not have to consider Bob's interest in the house.

Now if things are good between Carol and Dan and their uncle Bob, they might consider giving him the remaining money or, indeed, the full sale value. That is their decision. But the key point is that they are under no obligation whatsoever to do this, and any legal action he might bring would fail.

Malthusian

vigman wrote: »

.... And HMRC!

Nah. HMRC will get the same cut anyway, and they will get their cut

Other things being equal, if X has left asset A to Y and the residue to Z, but then sells A, instead of an asset worth £N in the estate there is now £N in cash. On his death, the value of the estate is the same. If he had simply drafted his Will to say "all my assets to Y and Z in equal shares" the value of the estate is still the same. So HMRC is blissfully unaffected by all this, their cut is the same. They neither gain nor lose.

Malthusian

securityguy wrote: »

Attorneys do not have a duty of care to potential beneficiaries, and it's only if they engage in transactions which are clearly intended to advantage themselves and have no justification for the donor that they are in the legal spotlight. The wise attorney, in my view, will make sure that they do not know the contents of the will, so the accusation cannot arise.

I don't disagree with this, but how would you prove you did not know the contents of the Will? I can imagine an attorney having difficulty claiming that he did not know what was in someone's Will despite being someone they trusted enough to be appointed their Attorney.

Perhaps the wise attorney should try to find out the contents of the Will so that they can minimise the possibility that a future dispute can arise (e.g. by avoiding selling properties that are specific bequests in the Will if there is another way of raising the money) but in a way that is "off the record" so that if it comes to it they can say "I know nutheenk".

Mojisola

vigman wrote: »

Yes but it was a family decision when all children were alive

In which case the family members who are gaining from the will should be moral enough to do a deed of variation and share out the inheritance with those who were would have inherited the other properties.

Keep_pedalling

Malthusian wrote: »

I don't disagree with this, but how would you prove you did not know the contents of the Will? I can imagine an attorney having difficulty claiming that he did not know what was in someone's Will despite being someone they trusted enough to be appointed their Attorney.

Perhaps the wise attorney should try to find out the contents of the Will so that they can minimise the possibility that a future dispute can arise (e.g. by avoiding selling properties that are specific bequests in the Will if there is another way of raising the money) but in a way that is "off the record" so that if it comes to it they can say "I know nutheenk".

Particularly if said attorney actually benefited big time from the sale of another beneficiary's bequest.