Can i buy children out of half the house?

gingercordial

Two things to consider.

1. At the moment you have your in-laws as trustees over the assets the children have, whether that's the house or cash. If you leave it as them owning half of the house, which you have the right to live in, there's very little that FIL can do to mess with this. The house is safe. If your partner buys it out and the children instead have cash in the trust, FIL now has plenty of opportunity to spend/"invest" it. If he "invests" in something and somehow loses the money, who will call him to account? He could easily claim he did something for the sake of the children but really siphon it off, if he is that kind of person.

2. If your partner buys half the house and then you split up (which could happen one day) what will happen then? He may want to force a sale to get his money back, and the courts may order that to be done. That means you are forced to sell up and the children lose their stable home. If your late husband's intentions were to protect that home for them to grow up in, that would be against his wishes. Your partner buying in is a risk for them.

But I do appreciate you need cash now. Challenge the pension decision first.

Malthusian

gingercordial wrote: »

1. At the moment you have your in-laws as trustees over the assets the children have, whether that's the house or cash. If you leave it as them owning half of the house, which you have the right to live in, there's very little that FIL can do to mess with this. The house is safe. If your partner buys it out and the children instead have cash in the trust, FIL now has plenty of opportunity to spend/"invest" it. If he "invests" in something and somehow loses the money, who will call him to account?

Just to tie this off, in that event the children could in theory call him to account, as he would have violated his duty to invest the money as a prudent person of business would, and would be liable to the children.

However there is every chance there would be absolutely zero point in suing the father-in-law as the money would be long gone.

If someone came here and said "My father in law who is a serial fraudster has been looking after some Will Trust money for my kids following their father's death for the last ten years, he says it's all gone as he blew it on duff investments, what can I do" the general forum response would almost certainly be either "Write it off, the money is gone" or "Get a free half hour from a solicitor, but you will probably have to write it off as the money is gone".

So the OP should do absolutely everything they can to prevent that scenario arising. I.e. not handing him a load of cash in exchange for the Trust's half-share of the house. Same goes for the partner.

But I do appreciate you need cash now. Challenge the pension decision first.

In principle I agree with this but I rather fear that it is too late, as it sounds like the pension trustees have already handed the money over to the in-laws in their capacity as trustees for the children. To do anything about it the OP needed to speak to the pension company before they handed over the money. Maybe the OP can clarify if the money has left the pension company.

Karendeakz

The pension company still have the money. As I am the children's only legal gaurdian they said require my permission to set up the trust fund. I haven't been in touch with them yet, I tried to call today to discuss it but they haven't left a direct contact number on the letter so I've left a message.

Malthusian

Good. Tell them that on no account should either in-law be appointed as trustee under any circumstances. There is no need to go into great detail.

If they use their discretion to decide that part or all of the death benefits should go to the children rather than you, there is no reason you, their mother, can't act as trustee for their money. Maybe with your partner as second trustee, given that you are in a long-term relationship.

Tammykitty

The trust for the pension should be set up so that it can be used for reasonable expenses as the children grow up - and you should request that from the pension company - the money sitting in a trust until the children turn 18 is unacceptable if you receive no money from your husbands estate to look after the children until that time.


Did your husband have any other assets - bank account, life insurance etc - who has that?


In terms of the house - you could sign over some of your share to you Partner (who could buy it from you) - the children own half in Trust, you own 1/4 and your Partner owns 1/4?
Again - in terms of maintenance it may be possible to get money from the Trustee's to pay for ongoing Maintenance to the house?


I agree that you need to arm yourself with the paperwork and see a solicitor as soon as possible

Mojisola

Tammykitty wrote: »

The trust for the pension should be set up so that it can be used for reasonable expenses as the children grow up

As the will doesn't seem to have made provision for the children, you could challenge it.

https://www.thegazette.co.uk/wills-and-probate/content/100346
"Even if the will is valid, certain relatives and dependants can challenge the division of the estate under the will (or the rules of intestacy), by claiming under the Inheritance (Provision for Family and Dependants) Act 1975 (the 1975 Act) that it does not make ‘reasonable financial provision’ for them."

You definitely need to talk to a good solicitor.

Malthusian

Mojisola wrote: »

As the will doesn't seem to have made provision for the children, you could challenge it.

Not sure where that comes from. The only asset the OP has mentioned in her husband's estate is his half-share in the house, which has been entirely left to the children... and if there are any other assets in the estate, there's no indication the same wasn't done with them.

(I can't check the screenshot the OP posted earlier showing a small part of the Will, as tinypic.com is down.)

Flugelhorn

Malthusian wrote: »

(I can't check the screenshot the OP posted earlier showing a small part of the Will, as tinypic.com is down.)

I seem to remember it had all assets into trust until child was 18 - no mention of funds being available beforehand

Silvertabby

Malthusian wrote: »

Pension trustees usually have complete discretion as to who death benefits are paid to. The starting point is the expression of wish signed by the member. However if for the sake of argument the expression of wish names the OP, and they separated after the expression of wish was signed, that would be a strong argument in favour of the trustees disregarding the nomination.

So putting the money in trust for the children with their grandparents as trustees would make perfect sense from the perspective of the pension trustees. They had no way of knowing that at least one of the trust's trustees is a serial fraudster and the OP apparently hasn't told them.

Agree with this. This may be one of the cases whereby in the event of death before retirement the pension contributions are refunded in lieu of survivor's pensions. However, many pension funds offer spouse and childrens pensions (the latter being payable until the child is 18/ceases full time education) in addition to the lump sum death grant. If the child is under 18, then the monthly pension can't be paid directly - instead, it will be paid to the 'caring' adult. I strongly recommend that OP speaks to the pension fund asap to explain that (a) she was still married at the date of death) and (b) the children live with her - and that, under no circumstances, must any monies be paid to the FIL.

Ms_Chocaholic

How did the crowdfunding page monies get paid to the FIL? Surely if they were to benefit the children wuoldn't that money be paid to you or he would have signed an undertaken that the money be paid to the children.

Which website was used so me/others can check the T&Cs as £1,700 is a lot to lose.