Advice Please.

[RonG]

Hi

Perhaps someone can assist.

My sister died intestate in 2016

She was survived by three siblings, me and my two younger brothers.

I acted as admin for the account, paid off all her legal responsibilities and wrapped things up.

In the end there was a 5 figure sum left over.

So as you know the law decrees that the estate would be split three ways.

Now the fun.

One of my younger brothers lives on benefits, and knew from the start that he have to declare matters to DWP. And in the long run not fully benefit from the estate. Even though he would be better off financially he has refused to cash the cheque and do the right thing. In the lead up to estate going through probate he ran up a number of debts, owing money to both of his brothers...

Time is marching on at it seems he would rather avoid the issue leaving the money to sit in the solicitors.

He refused to sign a deed of variation or any other document disclaiming the money, now he ignores letters from the solicitor, phone calls etc.

Question. In the long run what happens to the money? Does it go to the govt?
Does myself or anyone else have any legal entitlement?

I can't see myself suing him for the personal debts and as much as his attitude towards living off benefits apalls me I don't want to drop in in it

thanks for reading

[Peridot]

Hi Rong,
Blimey not often beneficiaries refuse their legacies normally it's them chasing for payment. Anyway, I assume from your post that the amount due to your sibling would take him out of the realms of entitlement for the benefits he currently receives?

The Age UK site may help understand the effect on benefits when a claimant comes into any money here:- https://www.ageuk.org.uk/information...-means-tested/

You mention debts that are due from your sibling would the re-payment of those debts alter the amount of the legacy due to him sufficiently to have little or no effect on his benefits then? Maybe it could be proposed that the repayments are deducted before sending the revised cheque to him? In addition if he has any other debts if they are paid immediately and he can evidence this then it could bring the mount down to a level that wouldn't affect his benefits too?

He does need to be careful as this is already benefits fraud if the money is available to him he just refuses to cash the cheque! In addition if he refused his share of the legacy there could also be allegations of intentional deprivation of assets, which again could lead to an investigation. It sounds like your solicitor has tried to deal with this in a sensible way suggesting a deed of variation. Was this deed to place his share of the estate into a discretionary trust or for him to refuse his legacy? Has your solicitor suggested any other routes for you as the personal representatives?

Has he been reminded of his duty to inform the Benefits Agency of any changes to his circumstances and the possible fraud implications if he doesn't. Sure he has he probably believes that by refusing it nothing happens but it seems he isn't even doing that. It does leave the rest of you somewhat frustrated. Of course you could report the potential fraud to the Benefits Agency, or suggest that you will unless he cashes the cheque? Any report can be made confidentially, although he will no doubt know where it came from if he ends up being investigated. It just leaves a bad taste in everyone's mouths really and I can see your dilemma.

A final option may be to pay his share of the legacy into Court under Trustees Act A 1925, s 63. This will be equivalent to obtaining a valid receipt from him as the beneficiary. However, it is regarded as an action of last resort. In addition the cost of doing this would be deducted from the estate so potentially reducing the residue pot to be divided for all of you. It would however absolve the Personal Reps in the future rather than having the money sitting in an account and being unable to finalise the estate accounts. Bear in mind the longer this carries on the more solicitors fees will also be payable as I assume they are holding the amount in their client account. They should not hold it indefinitely so a decision will have to be made whether to open another executor account and just place the funds in there until matters are sorted or the Court Funds office route.

Hope this gives you some ideas. Maybe a registered letter setting out what the options are to him and also pointing out that he is already committing fraud might prompt him into action?

[2222]

Have you been paid out in full? If so, need you over-worry how much of a hash your brother makes of this? You should pass on Peridot's helpful warnings, as an act of brotherly love, but after that it's up to your brother, surely?

[RonG]

Hi Rong,
Blimey not often beneficiaries refuse their legacies normally it's them chasing for payment. Anyway, I assume from your post that the amount due to your sibling would take him out of the realms of entitlement for the benefits he currently receives?

The Age UK site may help understand the effect on benefits when a claimant comes into any money here:- https://www.ageuk.org.uk/information...-means-tested/

You mention debts that are due from your sibling would the re-payment of those debts alter the amount of the legacy due to him sufficiently to have little or no effect on his benefits then? Maybe it could be proposed that the repayments are deducted before sending the revised cheque to him? In addition if he has any other debts if they are paid immediately and he can evidence this then it could bring the mount down to a level that wouldn't affect his benefits too?

He does need to be careful as this is already benefits fraud if the money is available to him he just refuses to cash the cheque! In addition if he refused his share of the legacy there could also be allegations of intentional deprivation of assets, which again could lead to an investigation. It sounds like your solicitor has tried to deal with this in a sensible way suggesting a deed of variation. Was this deed to place his share of the estate into a discretionary trust or for him to refuse his legacy? Has your solicitor suggested any other routes for you as the personal representatives?

Has he been reminded of his duty to inform the Benefits Agency of any changes to his circumstances and the possible fraud implications if he doesn't. Sure he has he probably believes that by refusing it nothing happens but it seems he isn't even doing that. It does leave the rest of you somewhat frustrated. Of course you could report the potential fraud to the Benefits Agency, or suggest that you will unless he cashes the cheque? Any report can be made confidentially, although he will no doubt know where it came from if he ends up being investigated. It just leaves a bad taste in everyone's mouths really and I can see your dilemma.

A final option may be to pay his share of the legacy into Court under Trustees Act A 1925, s 63. This will be equivalent to obtaining a valid receipt from him as the beneficiary. However, it is regarded as an action of last resort. In addition the cost of doing this would be deducted from the estate so potentially reducing the residue pot to be divided for all of you. It would however absolve the Personal Reps in the future rather than having the money sitting in an account and being unable to finalise the estate accounts. Bear in mind the longer this carries on the more solicitors fees will also be payable as I assume they are holding the amount in their client account. They should not hold it indefinitely so a decision will have to be made whether to open another executor account and just place the funds in there until matters are sorted or the Court Funds office route.

Hope this gives you some ideas. Maybe a registered letter setting out what the options are to him and also pointing out that he is already committing fraud might prompt him into action?

Thanks for your well considered answer.

I will do my best to answer your queries.

After any payment of debts he still will be above any benefits threshold.
My solicitor recommended that we don't go down the trust route as she felt it could be dangerous for me, she didn't elaborate. So yes the Deed of Variation was felt to be a better way, though would this still be deemed intentional deprivation of assets? I have been emailing the solicitor about other options and understandably she is bring very coy. Even when we met face to face she didn't have any other suggestions.

We did look at how he would fare after his benefits were means tested and it appears he would lose a housing benefit at least.

So a cheque sitting in an account is making the solicitor money? I hadn't thought of that.Could you explain what you meant by the Court Funds Office route?

Finally I will study that link you gave me.

Much obliged

[RonG]

Have you been paid out in full? If so, need you over-worry how much of a hash your brother makes of this? You should pass on Peridot's helpful warnings, as an act of brotherly love, but after that it's up to your brother, surely?

Thanks mate, I will pass them on.
I know it is up to my brother, I just want to tidy up the loose ends legally, get repaid what is owing both to me and another member of my family and move on.
It has also
It is just irritating to see the dosh sitting there (and generating fees it seems) when it could be doing so much good.
Thanks for taking the time to reply

[Peridot]

Hi again,

Making the solicitors money probably implies more than it is, to be fair. They should be holding the money in an interest bearing account which would be due to the estate. However then further work is required to ensure all tax etc dealt with and the interest divided as appropriate between beneficiaries if needs be. So indirectly being paid as would need to do some work on the file occasionally. They are also not allowed under the Solicitors Accounts Rules to effectively be a bank so at some stage would have to recommend the funds be moved.

Even if he lost some means tested benefit as soon as his money drops below the cut off amount he re-applies so no worse off. No better of either but are you sure there aren't any other debts that need paying that would further reduce the sum once he has received it?

You would need an order from the Court that the money should be paid into the Court Funds Office. You need to speak to your lawyer about this. You could contact the Court Funds Office who may be able to assist you https://www.gov.uk/contact-court-funds-office