Deed of variation and proprietary/promissory estoppel

Mojisola

Namu said:

Thank you all for your opinions in this matter , the D o V was drawn up because in the unsigned Will she wanted a small amount of money to go to her neighbours who looked after her. We 4 agreed to this and the balance of the estate to divide between us.

Was it divided in equal parts or according to the intestate rules?

Namu

Hi Mojisola....after an allowance for monies for the neighbours the balance was to be divided in to 4 equal parts and D of V drawn up accordingly. thanks

mrschaucer

There are two thing going on at the same time.
All four beneficiaries of an intestate estate have agreed to give an amount to someone else before the estate is divided, and then one beneficiary has decided that he doesn't like the rules of intestacy and thinks he is entitled to more than his official "share" from the amount left over.  The problem is not the DoV but whether the problem beneficiary can prove his case sufficiently in court if it gets that far.  Does the solicitor believe that he is likely to win?

missnosey122

Intestate rules wd give 1 beneficiary(a) 50% as they were the only child to one of the Aunts siblings the other sibling had 3 children so each wd receive a 1/3 of their parent's 50% & nothing wd go to the neighbours

DOV sd be binding. Unless (a) can prove they meet all of the propierty estoppel criterias they will be unlikely to succeed in overturning DOV 

doodling

Hi,

It is still not clear who the solicitor is acting for as this could affect your approach.  Who has Letters of Administration for the estate?

The fact that the problem beneficiary signed the original DoV is strongly suggestive that they agreed with it at the time so whilst the problem beneficiary can claim promissory estoppel, they are at risk of having to explain why they didn't think they were promised something when they signed the DoV but do think they are promised something now.

If the DoV can be invalidated by the problem beneficiary then the starting point would be the laws of intestacy - is what they want to happen or are they looking for more, or less?

If the solicitor is Administering the estate then they need to be asked the following questions:

1. Can the DoV be cancelled by any of the parties to it?
2. Do they believe that the DoV has been cancelled?
3. Will they now be distributing according to the laws of intestacy?
4. How long will they be waiting for the problem beneficiary to make a claim (either on the basis of promissory estoppel or as a broader challenge to the distribution under the laws of intestacy) before distributing the estate?
5. Has the the solicitor seen anything which gives them the impression that the problem beneficiary would win a promissory estoppel case?

unforeseen

As I understand it a DoV can only be cancelled if ALL beneficiaries involved in it agree. 

mrschaucer

unforeseen said:

As I understand it a DoV can only be cancelled if ALL beneficiaries involved in it agree. 

Yes but if the problem beneficiary goes to law and wins his case (big if), then in theory he could be the sole beneficiary of the estate as per the unsigned will.  If he's the sole beneficiary of the estate then the DoV on the estate must be null and void, as the signatories to it were not the beneficiaries.  
Chicken and egg.
I can quite see why the solicitor isn't happy distributing the estate until he is satisfied that the problem beneficiary is NOT going to challenge things.

Savvy_Sue

missnosey122 said:

Intestate rules wd give 1 beneficiary(a) 50% as they were the only child to one of the Aunts siblings the other sibling had 3 children so each wd receive a 1/3 of their parent's 50% & nothing wd go to the neighbours

I have understood that there were two pairs of siblings, so 25% each under intestacy:

Namu said:

Just to try and clarify my Aunt had no children and was a widow so due to the unsigned will the next of kin are myself my brother and my cousin and his sister. My cousin was to have been the sole beneficiary had the will be signed. 

It sounds as if the Deed of Variation was to allow a bequest to go to friends who had helped care for aunt. Of course each individual could have made a gift without a DoV. 

I think I have asked, but have not seen an answer. Who is the solicitor working on behalf of? Who engaged / instructed them? Bottom line, who is paying their bill? Yes, I know that ultimately it's likely the bill will come out of the estate, but it's already been suggested that each beneficiary may need separate legal advice. 

If the solicitor is working for the cousin who would benefit from the unsigned will, then the rest of you could together engage your own solicitor to point out that it's in no-one's interests to prolong this, the chances of success are slim and may mean that after legal feels are paid, their bequest is less than the 25% on the table now, etc. 

Spendless

 My guess for cousins change of mind

By doing the DoV, your aunts neighbours have benefited in the same manner as if the will had been valid. 

Cousin having had a think about it, now feels that he is the only one who has lost out due to the invalid will, because otherwise everything else would have come to him and that's why he now wants a larger share. 


I would take the advice of the posts above over it. 

NorthYorkie

Namu: I agree entirely with Doodling’s post of yesterday. You do not seem to have answered the question as to whom Letters of Administration have been granted – I assume it is the solicitor, please confirm.

I can understand the Administrator’s hesitancy in distributing the estate but he or she needs to get off the pot and take some action to bring matters to a head, perhaps by telling the ‘problem beneficiary’ that the estate will be distributed in accordance with the Deed of Variation on a specified future date. That should goad the ‘problem’ into action, if he hasn’t done anything already.

My understanding of promissory estoppel is that a claimant has to show that in reliance of an expectation of a bequest from the estate he/she had taken some action which, in the absence of that bequest, had been to his/her detriment. For example this could be taking out a loan to purchase a property which he/she expected would be repaid by the bequest. Simply being disappointed or aggrieved at not receiving the bequest would not be sufficient, in my view.

For the record, a Deed of Variation is simply an agreement between the beneficiaries as to how the estate is to be distributed, disregarding the terms of any valid will or the intestacy rules. As such the Deed itself can be varied by a further Deed if, of course, all parties agree (which seems unlikely in this case). Furthermore, the two-year requirement which has been mentioned is only relevant if the Deed is to have effect for tax purposes as if the dispositions made by the Deed were in fact made by the deceased’s will. If the Deed is made outside the two-year time-frame (or if it is not desired for it to have effect for tax purposes), the the dispositions are treated as made by the beneficiaries who are parties to the Deed.