Executor has spent the money in the estate in a frivolous legal case

QuimbusFlestrim

getmore4less said:

Did anyone have POA for the Aunt.

The administration of the uncles estate should have updated whoever was in charge of the aunt affairs.

When was the house sold relative to the 2 deaths.

I know very little as to what happened after my Aunt's death. We were not privy to anything that happened. The first I heard was when the firm acting as executor contacted me. 

The house was sold around 1.5 years after my Uncle's death, 2 years after my Aunt went into a care home. I believe the executr should have informed the LA, possibly they did but I am not sure as I do not have any papers related to the matter. 

Grumpy_chap

The house was dilapidated and sold for £650k, possibly as far back as 9 years ago.  (Died 4 years ago and in the care home for 5 years.)
This must have been an expensive part of the country, so care home fees could easily have been in the range £60k/year.  So £300k over 5 years.


The Solicitor paid £180k in care home fees and £100k in legal fees.  So £280k.  May not have been far off the amount that would have been paid in any case.

Manxman_in_exile

QuimbusFlestrim said:

... The first I heard of this matter was when the executor's firm (the solicitor has since died) sent me the accounts last week and asked me to sign them off to issue payment to my children. After death duties, debts and legal fees each beneficiary will get less than £19k. 

I asked the law firm why they spent more than 50% of the cost of the debt, contesting it and they advised me that the executor in charge has subsequently died...

Hmmm....

If I were in your position I think I'd be a bit concerned if their answer to your question was a mere "Oh - Mr Smith has since died."  I'd want a better explanation for his (or the firm's) actions than that.  Whether you are entitled to a better explanation I do not know.  I presume as a parent of some of the beneficiaries that you (or they) are entitled to an answer.  I'm sure others will know.

Was the executor a sole practitioner or a partner or employee of the firm?  If he was a sole practitioner have his clients been taken over by a different firm?  I'm interested whether the firm contacting you now is the same firm your aunt and uncle appointed as executors.

I think that as others have suggested you need to find out how much the debt in respect of your aunt's care was, and to whom it was owed - local authority or care home.  And also whether the executor notified the LA and care home of your uncle's death.

getmore4less

Who sold the house, what authority were they using.

frayedknot

getmore4less said:

Who sold the house, what authority were they using.

Presumably our friend the deceased solicitor as executor.

Something stinks about this whole thing. Estates of £200,000 Do not pay death duties. 

I would say 5 years care home fees could be as little as £220,000 as this was a few years ago and she would have had  a state pension and possibly a private pension to help pay these. She had no liability before the house passed to her 
.
I'd be asking serious questions about the conduct of the executor and wanting definite answers to how much was paid and to whom. It seems the executor has used the estate as his own private piggy bank to fund unnecessary legal work. Was the work carried out by that solicitor or his firm?

Flugelhorn

getmore4less said:

Who sold the house, what authority were they using.

sounds like the property was sold by the authority of aunt's executor - there may not have been a POA to do it before

Keep_pedalling

frayedknot said:

getmore4less said:

Who sold the house, what authority were they using.

Presumably our friend the deceased solicitor as executor.

Something stinks about this whole thing. Estates of £200,000 Do not pay death duties. 

I would say 5 years care home fees could be as little as £220,000 as this was a few years ago and she would have had  a state pension and possibly a private pension to help pay these. She had no liability before the house passed to her 
.
I'd be asking serious questions about the conduct of the executor and wanting definite answers to how much was paid and to whom. It seems the executor has used the estate as his own private piggy bank to fund unnecessary legal work. Was the work carried out by that solicitor or his firm?

It would only have been 4.5 years, the house was exempt while her husband was alive.

Malthusian

How much would the estate have paid if the solicitors had simply ponied up what the care home / local authority demanded, rather than settling out of court for £180,000?

Until you have that figure you have no idea if the litigation was actually frivolous.

What exactly were the "death duties"? It doesn't sound like the estate was large enough for Inheritance Tax - there was an uncle (were they married?) and the net estate seems to have been at most £470,000. That's assuming the solicitor's costs aren't deductible. The outstanding care home fees are certainly deductible from the estate for IHT.

I can think of a number of reasons why IHT might have been payable (aunt and uncle not married, large gifts within seven years of death) but it seems worth checking.

QuimbusFlestrim

Thank you all.

The executor was a partner of his own firm which was taken over on his death by a larger firm. They should also take over his liabilities. He acted on his own administering the estate and taking decisions over the house and I think my Aunt's care home fees etc. I am not sure as the law firm that took over his business is not too responsive. 

I have drafted a range of questions to the new law firm regarding on who's authority the house was sold under, a actual proper breakdown of fees, liabilities and assets, the original cost of the care home fees prior to legal action and the papers regarding the legal action. I am under the impression that estate tax only kicks in at £325k. The only major asset apart from minor savings was the house £650k. You are right, the death duties and their accounts do not make sense and seem massively inflated. 

I feel I am right to question their accounts as well as their legal action. Until I get further information, I cannot understand the whole picture. Thank you everyone who contributed and for helping me get my head straight about this. Something does not feel right about this. 

getmore4less

frayedknot said:

getmore4less said:

Who sold the house, what authority were they using.

Presumably our friend the deceased solicitor as executor.

Something stinks about this whole thing. Estates of £200,000 Do not pay death duties. 

I would say 5 years care home fees could be as little as £220,000 as this was a few years ago and she would have had  a state pension and possibly a private pension to help pay these. She had no liability before the house passed to her 
.
I'd be asking serious questions about the conduct of the executor and wanting definite answers to how much was paid and to whom. It seems the executor has used the estate as his own private piggy bank to fund unnecessary legal work. Was the work carried out by that solicitor or his firm?

Flugelhorn said:

getmore4less said:

Who sold the house, what authority were they using.

sounds like the property was sold by the authority of aunt's executor - there may not have been a POA to do it before

A person can have multiple hats on but needs to be clear which one they are using when doing something like selling a house.


Executor of aunt will had no authority to deal with the aunts affairs until her death  house was sold before then.


The executor of the uncle may have had authority under his will to sell the place but that depends on the will.


I wonder who was dealing with the aunts affairs and assets after the uncles death and what authority they were using.
(care home should know)

it is also not clear if and when she may have lost capacity(care home does not always mean capacity loss)


If the solicitor(s) had no authority to deal with aunts affairs but the council/care home were dealing with them there may be a case there,  In the absence of POA(if no capacity) they should have asked for  a court appointed deputy?


I would be getting both wills and seeing exactly what they said to look at the asset flow.

along with the inventory and account for both estates