How do I know if estate is solvent?

Ac121

Hi. Im an old regular poster returned after many years for some advice please. 

My estranged father has died. I have been named as next of kin by the hospice and have registered the death. There is no will. 

I’m starting to pull together financial records but it’s starting to look pretty down to the wire as to whether the estate is solvent or not.

 From reading on here is seems many advise to leave insolvent estates well alone, even to the extent of using anonymous email addresses etc?! Can I ask why this is please? I’m not liable for his debts (am I?!)

So my question is how do I know if the estate is insolvent without gathering information? 

RAS

Hi

You can collect information, as to assets and debts. However if you start collecting money or paying debts, you are intermeddling. 

Creditors can't chase you for your father's debts, but they can chase the estate.

You need to make sure you are not administering the estate. Be clear to anyone that the estate might be insolvent and you are NOT administering it.

Technically, if insolvent, each of the creditors might receive a portion of their debt, but you don't want to get involved in those arguments.


Collect the paperwork and offer it to the creditors if they wish to administer it.

TBagpuss

the risk is that if the estate is insolvent, there are very strict rules about who gets what - if you get it wrong, you as administrator can be personally liable to the creditors, to put them in the position they would have been in had the correct rules been followed. 

So, for instance, (to take a very simple case) if  the estate had £500 in it and there were 5 creditors each owed £200. Assuming all the debts had the same legal priority, you would be required to pay each one £100.

If you actually  paid the first 2 £200 each and the third one £100, perhaps because they shouted loudest or because they seemed the most 'worthy'  then then 4th and 5th would get nothing. They ought to have got £100 each so could pursue you personally for that money.

Getting it right can be complicated, especially if there are a lot of debts and / or poor records, and so it is a thankless task where you get nothing but potentially risk personal liability. 

The idea of using anonymous e-mail addresses is mostly to avoid being harassed by creditors who think they can pressure or scare you into paying the debt even though you don't have any legal liability. 

https://www.bereavementadvice.org/topics/probate-and-legal/insolvent-estates/ sets out the order of priority for debts from an insolvent estate and also gives some explanation of the risks. 

getmore4less

Ac121 said:

Hi. Im an old regular poster returned after many years for some advice please. 

My estranged father has died. I have been named as next of kin by the hospice and have registered the death. There is no will. 

I’m starting to pull together financial records but it’s starting to look pretty down to the wire as to whether the estate is solvent or not.

 From reading on here is seems many advise to leave insolvent estates well alone, even to the extent of using anonymous email addresses etc?! Can I ask why this is please? I’m not liable for his debts (am I?!)

So my question is how do I know if the estate is insolvent without gathering information? 

Lot of work for nothing.

Then there is the potential of getting it wrong.

Marcon

Ac121 said:

I’m starting to pull together financial records but it’s starting to look pretty down to the wire as to whether the estate is solvent or not.

So my question is how do I know if the estate is insolvent without gathering information? 

If things look iffy, leave well alone. Why take the risk of getting it wrong, plus the hassle of sorting out creditors etc, when there's nothing in it for you - not even the satisfaction of finalising the affairs of someone dear and close to you, given you were estranged.

ClaretHead

Creditors can't legally force you to pay the estate's debts, but you are likely to get phone calls, letters and e-mails asking you to pay. Somebody sitting in a call centre looking at an outstanding account will often tell you that you have to pay it - they are just looking at their call list, they probably know nothing about the laws of probate and intestacy,

Ac121

Hmm ok thanks for the advice everyone. 

Would arranging / paying a funeral bill count as administrator duties? 

RAS

Firstly, if you instruct a funeral director, there are usually two ways to pay.

The director sends the bill direct to the bank and they pay it out without requiring probate. Assuming there is enough there to cover the bill.

If they are unable to bill the estate, then they will chase the person who gave the instructions for the funeral. 

Savvy_Sue

Ac121 said:

Hmm ok thanks for the advice everyone. 

Would arranging / paying a funeral bill count as administrator duties? 

Worth bearing in mind that you have no liability to arrange his funeral: if you do not do so, either the local authority or the hospital (if that's where he died) will arrange and initially pay for it. You can still attend, if you want to, but you'll get no choice of location, time or type of service. 

They will try to find out if his estate is able to bear the cost, but again, you don't have to work this out for them.

Ms_Chocaholic

Ac121 said:

Hmm ok thanks for the advice everyone. 

Would arranging / paying a funeral bill count as administrator duties? 

Yes I just wanted to add too that even as next of kin you have no liability to arrange his funeral (and please note that arranging his funeral means you are liable to the cost of this/paying the bill - I'm sure that's correct, maybe someone will correct me if I'm wrong).

74jax

Ac121 said:

Hmm ok thanks for the advice everyone. 

Would arranging / paying a funeral bill count as administrator duties? 

Are you happy to pay for the funeral? Sign the funeral instruction to pay?