House sale - payment of half to another party - solicitor unable to provide "banking" service

saajan_12

So the property is owned as TIC with 50% by DH and 50% by the the estate of MIL? 
Surely the solicitor would have to send funds to those legal owners, ie 50% each to DH and the executor? 

The fact that the executor happens to be the beneficiary and what formality there is to the probate process is presumably a separate issue. 

Note this may have the unintended concequence of the solicitor wanting to run and charge for ID checks on the executor. 

MrsPorridge

Thanks for all the help.  I will go back to the solicitor.

Flugelhorn

You say that the family member will be waiting for the money to be able to move simultaneously - can your solicitor not send it to the solicitor doing the conveyancing on the family member's new property? they would have to verify the ID of the solictor but that is done quite often when there is a chain

SDLT_Geek

MrsPorridge said:

Has anyone had experience of the following situation:

House jointly owned by DH and MIL (now deceased).  MIL left her share to another family member.  House is now under offer.  As DH is the legal owner (MIL's name still on deeds), our solicitor informs us that once sold all proceeds go to him and he then has to make the CHAPs payment to the family member.  Despite speaking with our bank we are both very wary of having to do this payment - we will need to be checking our account and once money has gone in we will then have to immediately pay out - as other family member will be waiting for that money to go through so they can move simultaneously into their new home (they are living in the house owned by DH and MIL).  

Despite assurances from our bank that its a simple and easy process and they will do it for us we are still concerned.  Have asked if our solicitor can make the payment to the family member, but he said it constitutes a "banking service" which they are unable to provide.

I am sure that this is not the first time this situation has arisen - and indeed it may be quite common? Can anyone give me reassurance please?

You have since confirmed that DH and MIL held the beneficial interest as "tenants in common".  That means that in English law we look at it on two levels:

(a)  The "legal title" now sits with DH alone by survivorship, so DH has the power to sell the property (subject to the point below about overreaching).

(b)  The "beneficial ownership" is held 50% for DH and 50% for the estate of MIL.

It sounds as if a point has been missed so far in the conveyancing: that DH transferring alone will not "overreach" the interest of MIL's estate and the buyer will not get good title.  Someone will probably realise soon!

The usual solution is to appoint a "second trustee" to the property, so two people can transfer and overreach the beneficial interests.  The obvious second trustee would be the family member who is the executor and beneficiary.

In terms of sending out money, the solicitors can only send the net sales proceed to their clients.  They cannot provide a banking service by paying out to other people.  A pragmatic solution might be for DH and the family member to become joint clients of the solicitors and for the family member to be appointed a second trustee.  The solicitors might then be comfortable (with joint instructions) in sending the net sale proceeds 50/50 to DH and the family member.