Is this mis-use of estate funds?

royw

Executors are a solicitor & aged relative who has handed over responsibilty to another solicitor at the same practice via POA. Residue of estate to be equally divided between two adult children (A & includes house with large garden & attached paddock which lies outside the village boundary and is not in the local plan for housing. A wants to obtain planning permission on garden and paddock, no possibility of compromise. Plan would involve demolishing the house after sale to developer. B wants to sell the house/garden as it is (family home, sentimental value & worth as much as replacement building plots). Would prefer to sell paddock with overage but would consider PP if house is sold as a house. A won't agree to this. They have failed to reach agreement for A to buy B's half (problem is overage clause). A threatens to sue executors if not sold for best value which in A's opinion means obtaining PP. Obviously no guarantee PP will be granted as not in local plan.
Solicitor says "[FONT=&quot]If you are unable to come to an agreement, the default position would be an outright sale of the land and property as it stands now. If the executors have to take this approach, we would be seeking advice from Counsel and/directions from the Court before proceeding. [/FONT][FONT=&quot]We are bound to do this to protect the executors position. Clearly this will cost money, which willhave to be paid by the estate."
[/FONT]1. Can B insist it is sold? Although the above would indicate this is so solicitor previously said they would pass over the property itself to beneficieries rather than proceeds from sale.
2. Are these costs legitimate or mis-use of estate funds? No-one to protect except themselves.

Savvy_Sue

If anyone is threatening to sue the executors, then I believe they have a perfect right to protect their position, and taking advice from Counsel and directions from the court doesn't seem unreasonable to me. And where else is the cost of this to come from if not the estate?

A and B need their heads banging together. Obviously they can each take their own legal advice (which they'd pay for themselves), and get their own estimates of value / likelihood of getting planning permission etc. But they risk losing a substantial amount by fighting it out legally.

Yorkshireman99

royw wrote: »

Executors are a solicitor & aged relative who has handed over responsibilty to another solicitor at the same practice via POA. Residue of estate to be equally divided between two adult children (A & includes house with large garden & attached paddock which lies outside the village boundary and is not in the local plan for housing. A wants to obtain planning permission on garden and paddock, no possibility of compromise. Plan would involve demolishing the house after sale to developer. B wants to sell the house/garden as it is (family home, sentimental value & worth as much as replacement building plots). Would prefer to sell paddock with overage but would consider PP if house is sold as a house. A won't agree to this. They have failed to reach agreement for A to buy B's half (problem is overage clause). A threatens to sue executors if not sold for best value which in A's opinion means obtaining PP. Obviously no guarantee PP will be granted as not in local plan.
Solicitor says "[FONT=&quot]If you are unable to come to an agreement, the default position would be an outright sale of the land and property as it stands now. If the executors have to take this approach, we would be seeking advice from Counsel and/directions from the Court before proceeding. [/FONT][FONT=&quot]We are bound to do this to protect the executors position. Clearly this will cost money, which willhave to be paid by the estate."
[/FONT]1. Can B insist it is sold? Although the above would indicate this is so solicitor previously said they would pass over the property itself to beneficieries rather than proceeds from sale.
2. Are these costs legitimate or mis-use of estate funds? No-one to protect except themselves.

The solicitors are quite entitled to do this. What I don' t see is why the house has to be sold by the executors unless the will specifies it has to be. In any case the beneficiaries have no say in the matter since the executors are the ones administering the estate. As Savvy says they need their heads banging together.

Keep_pedalling

I suppose when an executor is faced with beneficiaries demanding different things from a shared asset, and one of them is threatening them with legal action, then they have little choice other to seak a legally watertight solution. That will cost money and the only place that is going to come from is the estate.

If I was the executor I would hope to be transferring the property to the beneficiaries and let them sort out the problem between them, but I would not do that without taking legal advice first.

unforeseen

A threatens to sue executors if not sold for best value which in A's opinion means obtaining PP. Obviously no guarantee PP will be granted as not in local plan.

That can not be considered a valid argument.

If it were then the ar4gument that getting PP and building 20 houses on the land would be best value.

It is the best value for the estate as it stands now, not after what might be done to enhance the value.

If A wishes to use his own money to employ somebody to draw up plans and submit the for PP then he is free to do so. If successful B could profit but needs to agree the sale or B can just say no. If PP refused then A is out of pocket. There is no duty on the executors to go through the process at estates costs to draw up plans and submit PP. I would see that as definite mis-use of estate funds.

securityguy

Threatening to sue the executors when one of the executors is a solicitor is insane. The solicitor can take all the costs (ie, their own billable hours including margin) from the estate, while doing the work in spare hours when they don't have billable work to do. They are going to say, essentially, "bring it on": they make the billable hours, and at worst just have to do the executor job differently. Unless there is clear, tangible, manifest negligence, they win either way.

getmore4less

If A really believes the place is worth more than B is happy with then A should offer to carry the risk costs and penalty for delayed sale if the plan fails.

Yorkshireman99

Hopefully when A goes to their solicitor they will be told the folly of their view. My only conern is if the solicitor who is the joint executor feels they need to take counsel's and even the court's opinion are they really unsure of their position or just covering their backside? As often happens on here we simply don't have enough information.

securityguy

The executors are perfectly entitled to cover their backsides. In matters like this, a counsel's opinion would be pretty standard practice. Why should they take the risk of later being accused of not taking proper advice? A is used to getting his way, and has shown his willingness to invoke m'learned friends. What's the line beloved of self-help groups? "When someone show you who they are, believe them"?

Kynthia

Crazy. Executors only have to deal with assets as they stand at the time. They don't have to go to the time, effort, and expense of improving them. Where would that end?

royw

Kynthia wrote: »

Crazy. Executors only have to deal with assets as they stand at the time. They don't have to go to the time, effort, and expense of improving them. Where would that end?

Thank you all for your replies. From Kynthia's reply above - does this not mean that A's insistance that PP be obtained to improve the existing asset must fail? If so surely the solictor should know this so seeking council becomes a back-covering exercise?
If executor wasn't a solicitor I would agree the need to seek council. But executors are now two solicitors who have to seek council from a third. Am I cynical or are they incompetent/milking it?

Yorkshireman - what further informaion are you looking for?