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Probate / Will Query
First time executor here, feeling a little daunted.
I am executor along with my spouse ( Executor B) for a good friend who passed away recently.
The deceased's estate is well under the IHT limit.
The deceased was married and their residence was held as tenants in common 50/50 with their spouse
They ( the deceased ) left their 50% share of the house to a friend Mr X but only after death of remaining spouse.
They left their residual estate to Executor B
They left no assets to their spouse who owns the remaining 50% of the house.
We have all of the details of bank accounts shares pensions etc but as tenants in common I am assuming that when we value their chattels ie everything in the house it will be on a 50/50 basis with their spouse? They own 2 cars that are registered in the name of the surviving spouse although they were purchased with the money of the deceased as far as I am aware. Do these also form part of the estate or do they belong to the surviving spouse.
How can the residual estate be paid out the executor B value wise if there isn't enough money to do this? Can executor B waive rights to this and allow the chattels to be kept by the surviving spouse?
Is it best to employ someone to value the chattels so it is independent of the executors?
Feeling like this is a minefield
PF
Comments
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Sorry for your loss.
Based on your post you may be better employing a professional to handle being the executor for you, passing the legal liability to them. This Will structure seems very strange and impractical to implement, was it drafted by a solicitor?
Does the residual estate pass to B when spouse dies too or before? Seem odd to take half the furniture before.
When you say way under IHT limit, are you referring to the £325k limit (not the 1m) which would apply in this case?
If the Will says their share of the house goes to Mr X, the chattels are not the house, so are no included in this term.
Cars are owned by the registered keeper, if that is the spouse they are irrelevant.
Yes the chattels will need valuing ideally by someone else.
B could waive any or all of the estate and a deed of variation can be done to change the Will to give up some or all of the share. Depending on wording there is potential to demand the house sale to release enough funds to pays out the beneficiaries, hopefully the Will is better written than that.
There are also potential legal issues with the Will if nothing is left to the spouse and they are a dependant (you did say the deceased bought the cars). From what you're saying they get to live in the 50% of house that's been given to X and lose half the chattels and all the savings & investments in the deceased name immediately. Seems rather harsh especially if they have a long life expectancy.
Yes it is a minefield especially a weirdly complex one like this.
Sense is not common.1 -
does sound very complex and potentially a rum deal for the spouse.
just checking that it really does say this, a lot of wills say "everything to spouse, but if they predecease me then it goes to A&B"
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Household chattels would normally be treated as joint assets so his spouse would inherit those by survivorship, they do not form part of his heritable estate. As for valuation just use a nominal amount for the lot. Valuation is for IHT valuation it does not form part of the probate valuation.
Pensions are also not part of his estate and are not covered by his will. Did he make an expression of wishes for those? The trustees will be reluctant to pay out to anyone else when he has a widow.
The registered keeper of the car is not same thing as the owner, but proving ownership in a dispute is difficult. My view would be that whoever paid for them they were joint marital assets so I would treat them the same way as the chattels.
As for the house, the will has created an immediate post death interest trust. The trust is now the legal owner of 50% of the house but his with has beneficial ownership of the whole house. This means that bequest is covered by spousal exemption and for IHT purposes it forms part of her estate. The trust will need to be registered with HMRC within two years of your friend’s death.
Are you on good terms with his widow?1 -
Yes we are all very good friends
He decided to leave his half of the house to a friend and the residual of his estate to executor B.
The surviving spouse has the right to live there for the rest of her life or until she decides to sell up after which time 50% transfers to Mr X. I am not sure who the surviving spouse named in her will for her estate. The trustees ie executor A and executor B are to ensure the survivng spouse maintains the property and keeps bills up to date. We didn't know this until a couple of weeks ago. So we need to keep an eye on the house until it is ready to go to Mr X and this creates an obligation.
The will was drawn up by retired bank manager who does wills in his retirement.
I am still bewildered that a short 3 page document could throw up so many ifs buts and maybes
PF
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My intial instinct is if from the widow's perspective there is inadequate financial provision under the terms of the will going forward, she appears to have a valid claim under the Inheritance ( Provision for Family and Dependants ) Act 1975 to vary the will for a more favourable outcome on her behalf.
If husband had DB pensions, can't see any scheme trustee paying out to anyone other than the surviving spouse. As for DC schemes, even if expression of wish diverts the remaining pot to the friend, the trustee would still have discretion to ignore the request if it means leaving the surviving spouse in hardship.
Frankly, I would be more interested to learn the widow's view of this unconventional arrangement, rather than providing any guidance to the executors.
The entire situation is decidedly peculiar with an untold back story that might throw some light on the oddities, starting with what gave a retired bank manager the impression they were remotely qualified to draft what is in effect an IPDI will trust.
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I have to agree with the above comment this is a very strange arrangement. Frankly once you have administered the will I would not take on the role of trustees, I would leave that to the widow and Mr X.
Does the will say what happens to the trust if Mr X dies before the widow?
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It doesn't say what happens in that scenario adding more possible complication
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The kind of outcome one can expect from the efforts of a demonstrably unqualified retired bank manager who should have known better than to get involved in the first place.
Reccomend executors and widow obtain competent legal advice, before any attempt to probate this will and administer the oddly structured trust.
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My apologies, the chap who drew the will up is a retired solicitor, my error.
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My reccomendation stands, a competent private client solicitor is required to advise the parties on this arrangement before progressing further.
A Will running only to 3 pages which purports to establish a trust, was not prepared by a solicitor with relevant competency in trust matters, and not a person one should return to for assistance.
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