Beneficiaries liable for fees?

Rosetta4

The probate company which administered my late family member's estate has recently informed me of PPI-related funds they've sourced and held since 2020.

Without the co-executors' prior knowledge or consent, an external company was autocratically commissioned, culminating in the beneficiaries now being subjected to 20 percent plus VAT consultancy fees.                   

Having been denied the opportunity of making independent potential PPI enquiries, we deem the projected fees unfair but the probate company is unrelenting.

Suggestions on how to proceed will be appreciated.

elsien

Surely it’s the estate that’s liable and not the beneficiaries? Although the end result of a reduction in bequests may be similar.

Keep_pedalling

Unregulated probate company so I doubt whether there is much you can do. This must of happened very close to the PPI claim deadline (29th Aug 2019) if it was paid in 2020 so maybe there was little time for consultation. Did the other executor play any active part in administering the estate or did they leave it all up to the probate company.

Only the executors could make the claim while the estate was being administers not the individual beneficiaries. 

Malthusian

This is tricky. To start of, was the probate company was appointed as an executor? ("Co-executor" implies they were.) Did any of the "co-executors" reserve their powers?

Assuming the answer was "yes" and "no":

Executors must act together and as the contract for the claims management company's services was not signed by all executors, the contract is arguably invalid.

However, that does not mean the estate can keep the compo and tell the CMC to naff off.

Nor can they tell the CMC to pretend it never happened and hand back the compensation to the PPI lender, then launch their own complaint. Even if that was possible (it's not) it is obvious now that the complaint is a slam-dunk. In reality, the bank has accepted liability and made its offer (or the Ombudsman has made its ruling if it got that far). While it is always an error to hire a CMC, in this case they have already done the job on the estate's behalf and can't undo it.

I think the law of "unjust enrichment" may apply here although I'm not 100% certain that's the right terminology. Either way, the estate has been enriched by the compensation, at the CMC's expense, and the CMC has a claim against the estate for their time and effort.

If the CMC's fee was excessive the estate might be able to argue that their claim on the estate should be reduced to a more reasonable level reflecting the actual services performed, given there is no valid contract. 20% + VAT could easily be excessive but it is half what some CMCs charge. 

So the CMC clearly needs to be paid something. The cost of that should arguably fall on the probate company as if they didn't obtain the agreement of all executors, they exceeded their authority. That said, how much was the probate company doing? You say that if they hadn't hired a CMC the other executors could have made a PPI claim themselves, which is very true. But would they? Or would they have left the probate company to do it? In which case the probate company would have charged for the extra time they spent on the complaint instead.

How much compo are we talking about?