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  • FIRST POST
    • carled
    • By carled 28th May 16, 8:44 AM
    • 143Posts
    • 25Thanks
    carled
    Messy probate situation with children fighting with stepmother!
    • #1
    • 28th May 16, 8:44 AM
    Messy probate situation with children fighting with stepmother! 28th May 16 at 8:44 AM
    Trying to understand if a solicitor is offering best advice here, I'll try and summarise.

    Widow (W) is married to Deceased (D) for 17 years. It's a second marriage. D has two children (D1 & D2), Widow has two children (W1 & W2). Relationships between all are good until after death of D.

    D's will appoints W and friend (F) as "executors and trustees" as the basic thrust of the will is that it will all end up in a discretionary trust (DT).

    W along with D1 & D2 are named as potential beneficiaries of DT.

    At funeral of D, Friend F announces that he has moved out of the area and has no wish to be part of probate, etc and will renounce.

    Unknown to W, D had (some months after original will) added a codicil which appointed D1 & D2 as "executors in addition to those executors named in the will".

    W starts to act as sole executor, shutting down some accounts belonging to D and putting them into a new account opened for estate funds. She uses some of the funds to pay for funeral expenses and other testamentary bits & pieces.

    As the will is complex, W is advised by financial adviser to visit a solicitor for advice, which she does. At this point she is made aware of D1 & D2 being added as executors.

    W immediately ceases acting alone and speaks to D1 & D2 to advise them what she has done so far. Initially she is told (in an email) that she has done nothing wrong and there is no problem.

    Things quickly sour. There are disputes over how to handle the estate and the discretionary trust. W is visited several times by D1 & D2 and put under pressure to agree to formation of new trust in which they would have more control. She refuses. Around this time, D1 draws a diagram of the estate assets, once again clearly stating (W still has diagram) that W can keep the money already in the estate fund and the remainder will go into the discretionary trust.

    Relationships break down, solicitors get involved and over a period of months things sour completely. Friend F has by now legally renounced position as executor.

    D1 & D2 now engage new solicitor and start demanding back payment of the money initially declared to be ok for W to keep and use. As W has now carried out expensive planned maintenance to property (arranged before his death by D) she is unable to pay the money back and disputes that she has to anyway as all three executors (her, D1 & D2) had agreed (with evidence) that she could keep the money.

    W is advised by her solicitor that she should threaten D1 & D2 with IHA claim as existing will leaves her nothing (all goes to DT, from which she is not guaranteed to inherit). D1 & D2's solicitor refers to money W has already had (approx 1/3 of estate) and asks "what more does she want?" which is at odds with them demanding that she pays this amount back anyway.

    D1 & D2 continue to delay grant of probate and instead launch legal action to remove W as an executor as they feel she has acted without their authority or consent in appropriating estate funds (this is the money D1 & D2 agreed she could keep).

    At directions hearing, judge immediately removes W as executor, apparently taking at face value D1 & D2's claim that they did not consent to W keeping the money.

    D1 & D2's solicitor attempts to use the order to ALSO remove W as a trustee, but W's solicitor sees this and argues that they applied only to remove as executor as executor so cannot do this.

    D1 & D2's barrister argues but loses the argument and judge declares the order as removal of executor only.

    Up until this stage, all involved have acted and referred to D1 & D2 also being trustees of the DT. It is at this point that W1 realises the will & codicil actually only appoint them as executors, not trustees.

    Friend F is now told he is still involved as trustee but announces he wants nothing to do with it and will sign deed of resignation as his intention was not to be involved with the estate at all.

    As things stand at this point, we are in a strange position whereby D1 & D2 as remaining executors will get probate and have to pay it into the DT, which is managed solely by W, who they just had removed as executor. as it's a discretionary trust, no beneficiary has a right to benefit, so in theory W could decide to keep all the money for herself and D1 & D2 would have no grounds for complaint.

    W's solicitor is convinced that D1 & D2 will now apply to have W removed as a trustee as they failed to do so explicitly last time. He feels that they will almost certainly succeed because of what W did with the estate funds.

    That's pretty much where we are to date. W is very stressed as she feels she's done nothing wrong. We're amazed that the judge ignored the fact that all executors had agreed to her having that money (and evidence exists of this), then lied about that in a court claim and got away with it, leading us to believe W's solicitor did not present this information to the court. He has yet to confirm or deny whether he did.

    The next concern is his firm belief that she will be removed as a trustee as it was only a technicality that stopped this last time. Even though probate is yet to be granted, apparently the DT HAS already arisen as W has spent some of the funds on non-estate things (she paid for oil heating in house for one thing). His contention is that as the will trust has arisen, W has committed the same misdeed against the trust as she did against the estate, therefore it's obvious she will also be removed as trustee, leaving no trustees at all and the court will have to appoint one/some. Obviously D1 & D2 are angling to have themselves appointed as trustees so they control everything themselves.

    W's main contention is that all executors of the estate consented to her having the money already in the estate account (evidence exists showing this to be the case) so how can she have been held to have committed a misdeed against either the estate or the trust? Some 80-90% of the amount has been spent on the property anyway (half of which D1 & D2 will inherit in future) and much of that was something their own father committed to prior to his death.

    If anyone has managed to get this far and has any experience or comments on this, it'd be great to hear some other points of view - even if you agree with W's solicitor! I'm too close to the action to view it objectively. As D1 & D2 can be proven to have lied and have also stolen paperwork from W (police did nothing as it was a civil matter as far as they were concerned!) it seems at the moment that cheats do prosper.
Page 6
    • marcelli
    • By marcelli 3rd Jun 16, 9:59 AM
    • 24 Posts
    • 12 Thanks
    marcelli
    D wanted to provide for them all. He was apparently advised that a DT would be a good way to go, as money could be invested and so increase. The house too, might on the face of it increase in value. (Both possibilities are now higly questionable in today's financial markets - ok, opinion on my part). He made W trustee of DT, as she is his widow and their relationship would dictate some more immediate responsibility towards her. Trusts all seem to rest on goodwill, but for whatever reason D1 and D2 it could be argued are not showing goodwill towards W.
    The Will states who are Beneficiaries, presumably somwhere stated as equally if not so under the trust (not a good idea then for it to be discretionary). If the problem is loss of funds, surely it is sensible to resolve matters sooner by discussion, than later following more substantial financial loss incurred by legal action; any investment is subject to some sort of risk. I believe it is possible to "take a view" on trusts, even under a Will, and that would require agreement, and perhaps then either not set up the trust, or for one or more of them to take their third share as soon as it has been set up if they insist on its being set up, so that there are not more painful and drawn out arguments? Can W make enquiry of a Trust lawyer on this? I speak from some experience here.
    The danger is now that a substantial part of the funds will be spent on legal action, relationships will deteriorate further, D1 and D2 want more say in the share of the DT funds (which goes against what D initially requested in the Wil), so will end up doing what they are accusing W of i.e taking more than their share at their own discretion.
    I wish you all speedy delivery from all this anguish.
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