Executed of will not paying beneficiaries

[kayrothery]

Hi
My nephew is a beneficiary to my cousins will but my second cousin (executor) is finding every excuse under the sun to not pay. We already think he sold the house well under market value and now he wants to keep my nephews money is his account until he becomes of age (25 as stated in he will) he is only 14 now.
The will states it needs to go into a trust account until 25. He has deducted funeral costs and other bills that we know were already paid before our cousin died, he paid his bills up front and he’s funeral was all paid too.
Can anybody offer advice on what to do next?
Many help would be appreciated.
Thank you in advance

[lawboy65]

There are many legal routes a beneficiary can take against an executor.



Inventory / Account: The least expensive and, in theory, the quickest way to compel an executor to account for his activities is to apply for an order that he provide an inventory and account in respect of the administration. If the application is successful the executor must provide the inventory and account which can be examined by the beneficiaries in order to assess the executor’s activities and whether any further action is required.

Section 50 Application: A beneficiary can apply to the Court for the executors to be removed or replaced under section 50 of the Administration of Justice Act 1985. It is not necessary to establish wrongdoing or fault on the part of the executor. The Court will generally replace an executor where, for example, relations between him and the beneficiaries have simply broken down to such an extent that it is no longer possible to properly progress the administration of the estate.

Judicial Trustee: A beneficiary can also apply to the Court under s.1 of the Judicial Trustees Act 1896 for the appointment of a judicial trustee to administer the estate either together with the current executor, or as a replacement.

In any legal action there will inevitably be costs involved so you need to think about this before commencing litgation.

The usual rule is that the unsuccessful party will normally be ordered to pay the successful party’s costs in litigation. However, there are circumstances when the costs will be borne by the estate. This could seriously deplete the value of the estate.

Good Luck.

[Peridot]

Hi Kayrothery,

To clarify the Will has left a legacy to your nephew stating that it is to be held in trust until he reaches 25 years? The executor is to be the trustee as there is no other trustee appointed?

If that is the case then it is up to the executor whether they consider releasing the funds sooner to a parent for example. This would have to be with the parent providing an indemnity to the executor that they will hold the money in trust until their son reaches 25 and that any mismanagement of the trust funds would mean their son suing them and not the executor. However whether the executor wishes to accept an indemnity from the parents or guardian is up to them and not the parents of the child or anyone else for that matter.

Depending on the sum involved it would be sensible for the executor to obtain independent financial advice on the best vehicle to hold the monies for the next 11 years potentially to ensure the best returns and this is one of the duties of the executor/trustee when dealing with gifts into trust or to minors etc.

Generally, there would be 2 trustees but this will depend on the Will wording. The Will may also allow for the appointment of other trustees to deal with the Will Trust that has been created. Again depending on the wording in the Will it is possible for advances to be made at the trustees discretion for the benefit of the child. Without having knowledge of the exact wording in the Will it is difficult to say with any certainty and it may be something the nephew's parents would consider discussing with a lawyer to ensure they understand what the Will allows for.

It seems sensible at this stage for the nephews representative to obtain estate accounts which demonstrate the assets and the distributions from the estate. Or have they received these already hence your comments about the cost of the funeral having been taken when you understand the funeral had been pre-paid? Maybe there were additional cars or arrangements for the funeral that needed to be paid that weren't originally booked by the deceased when the plan was created. All liablities must be settled from the estate, before any beneficiaries receive their legacies or the residue is calculated.

As far as any sum that is to be held in trust is concerned, it should be held in a separate account or appropriately invested (with independent financial advice) to ensure the capital sum is preserved and maximum interest is earnt. The trustee has significant responsibilities and duties that if they do not manage the fund correctly, can result in them being personally liable if they have not carried out their duties as trustee.

I would not recommend making any application at this stage to 'force' the executor and don't believe this would be the best course of action at this time, bearing in mind the wording of the Will. There is always recourse for the beneficiary (the nephew or his parents/guardian on his behalf) to pursue this at a later point if the trust has not been operated correctly during the period of the trust but that is a way down the line yet.

If they haven't already then his parents/guardians need to obtain copies of the estate accounts and also ask the question of the trustee how they propose investing the money. Once you have the information, or if the information refuses to be provided, then it may be sensible to consider other actions on behalf of the nephew. By that point it would be advisable to obtain some face to face legal advice on the options open to the nephew (or his parents/guardians), now and in the future. Although the comments in the previous post are not incorrect I think there is a way to go before an application to the Court with the associated stress and cost to the parties (which could also end up reducing the beneficiaries legacy), need to be taken.