Probate Problem for Sale of House Owned as Tenants in Common

Rinnie

Our parents owned their property as tenants in common.  They had identical wills written in 2001 and left everything to the surviving spouse, then my brother and I.  Their 50% share each of the house left to my brother and I.  Brother and I not fully aware of these wishes.

Dad died May 2016.  Our Mum did not apply for probate at that time.  She did seek some advice but we do not know what questions she asked and to whom, but she was under the impression she did not need to do anything.  This is now proving to be a problem.

Fast forward to October 2022.  Mum died.  We were granted probate in May 2023.  The property is going through a sale, but our solicitors are now insisting that we apply for a grant of probate for our Dad.  I will seek advice from the solicitor who dealt with Mum's probate but wanted to ask if anyone else has found themselves in this situation and how complicated it was to apply for the grant when things like the first spouse's nil rate band has been transferred to Mum, getting hold of the original will which I understand the solicitor sent off with the IHT forms etc. And potentially explaining it all to the probate courts.  We did not pay IHT on Mum's estate and I'm now wondering if transferring the nil rate band will have a negative impact on Dad's estate now.  I would guess the total value of the full shared estate is about £460k or thereabouts.

Anyway, anyone who has found themselves in this predicament - your experience of sorting it out would be very helpful.

Thanks in advance.

p00hsticks

Rinnie said:

Our parents owned their property as tenants in common.  They had identical wills written in 2001 and left everything to the surviving spouse, then my brother and I.  Their 50% share each of the house left to my brother and I.  Brother and I not fully aware of these wishes.

Sorry, this isn't very clear to me. 
When your father died, was his 50% share of the house left to your mother, or to you and your brother ?
And if the latter, do you know if your father's will gave your mother the right to continue living in the property ? 

Rinnie

Hello, thanks for your reply.  From what I can work out in the legal speak, each parent's share of the property was left equally to my brother and I but with the right for the surviving spouse to stay in the property until they die, remarry or cohabit.  This is what happened.  Is that helpful?

RAS

If your father had left his share to you and your brother absolutely, probate should have been necessary and your might have wanted to register your shares with the Land Registry.

It would have removed any right to first purchaser status for you and your brother, could render you both able for additional SDLT charges and CGT when the property was sold. The Land Registry would record the restriction on sale without consent but not a change in ownership.

Leaving it in trust meant that your mother gained beneficial interest in the whole property, with your future rights held in trust. The trust should have been registered with HMRC but that's a recent introduction. 

Marcon

Rinnie said:

Our parents owned their property as tenants in common.  They had identical wills written in 2001 and left everything to the surviving spouse, then my brother and I.  Their 50% share each of the house left to my brother and I.  Brother and I not fully aware of these wishes.

Dad died May 2016.  Our Mum did not apply for probate at that time.  She did seek some advice but we do not know what questions she asked and to whom, but she was under the impression she did not need to do anything.  This is now proving to be a problem.

Fast forward to October 2022.  Mum died.  We were granted probate in May 2023.  The property is going through a sale, but our solicitors are now insisting that we apply for a grant of probate for our Dad.  I will seek advice from the solicitor who dealt with Mum's probate but wanted to ask if anyone else has found themselves in this situation and how complicated it was to apply for the grant when things like the first spouse's nil rate band has been transferred to Mum, getting hold of the original will which I understand the solicitor sent off with the IHT forms etc. And potentially explaining it all to the probate courts.  We did not pay IHT on Mum's estate and I'm now wondering if transferring the nil rate band will have a negative impact on Dad's estate now.  I would guess the total value of the full shared estate is about £460k or thereabouts.

Anyway, anyone who has found themselves in this predicament - your experience of sorting it out would be very helpful.

Thanks in advance.

Plenty of offspring will have found themselves in a similar situation, so you aren't in an exclusive club where the territory is wholly uncharted! 

If your father left you half of the house at the time of his death, that will limit the transferable band available on your mother's death, which I'm sure you've realised. Whether this has a positive or negative overall impact depends on how the value of the property has moved in the intervening years.

Your solicitors will need to guide you through a process which is a bit messy and will take longer than it would have done had probate on your father's estate been sought at the time of his death. It won't be the first time they've had to do it, nor will it be anything like the first time the probate courts have seen this scenario, so prepare yourselves for a bit of a wait, but otherwise nothing too awful.

Land_Registry

If they were registered as joint owners, and your opening lines suggest they did, then probate is only needed for your Mother’s estate. 

As joint owners when one dies the legal ownership passes to the surviving joint owner. 

The TIC, wills, trust, % shares all relate to their beneficial ownership 
So best check the registered information and clarify with the solicitor re the need for probate for Dad - there maybe an unidentified reason 

Rinnie

Dear Forumites, 

Thank you to all for taking the time reply.  Not got the hang of how to reply individually to you.  I have made contact with the solicitor who dealt with our Mum's probate and it seems they still have my Dad's original will which was provided as part of her application.  So at least I have that to make the application.  He has given me some initial general advice and indicated it shouldn't be as bad as I initially anticipated.  Fingers crossed.  I will seek full advice when I can get an appointment and may just have to get it done by a professional and put it down to experience.

Thanks all.  Still happy to read comments from anyone who has been through this.

Rinnie

Quick update.  I have spoken to the solicitor who handled Mum's probate earlier this year.  Based on our particular circumstances, he has advised I need to complete form IHT205, the one about excepted estates and prepare a legal statement.  He gave me the legal statement that was prepared for my Mum, so I just have to make some amendments and it should satisfy requirements.  I have been advised to seek a professional valuation of what the property was worth in 2016 when Dad died, rather than looking at sold house prices on Right Move for example.  There may well be CGT to pay on the difference between the 2016 valuation and the 2022 valuation, less our tax-free allowances and of course, just on Dad's half.  Frustrating, but not much we can do about that.  Just got to decide whether to go it alone or get the solicitor to do it. I feel the solicitor will have more clout but then again it is only one form, a legal statement and two covering letters, so I'm not sure it's worth the expense.  Will mull over and decide.

Anyway, just added this in case it helps anyone else, although of course, all scenarios are different.

greyteam1959

Pay a solicitor to sort it all out for you would be my advice.
The will of course be a cost to it but at least you know everything has been done correctly and all taxes etc paid.

Rinnie

greyteam1959 said:

Pay a solicitor to sort it all out for you would be my advice.
The will of course be a cost to it but at least you know everything has been done correctly and all taxes etc paid.

Funnily enough, as I have spent the last few hours looking through everything I think I have come to the same conclusion.  I am not sure it is worth the risk of getting it wrong.