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If one creditor is slow to respond can pro rata payments to other creditors be made?

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  • If one creditor is slow to respond can pro rata payments to other creditors be made?

    Hello everyone,
    I'm helping my friend deal with her late mum's virtually insolvent estate. Des8 advised a few months back to ask for proof/evidence a debt is in fact in the late mum's name and not step father's (who is long dead - the mum said they were her late husbands debts she was paying off) and we did that with a few creditors (thanks Des8) but no replies have been received. The amount to be shared out after funeral and other legit expenses is less than 2k and debts are about 30k, so not like anyone is going to get much, but does she have to wait until every creditor responds? I'm thinking she could write to everyone again and ask for proof/evidence within a specific timeframe, such as one month, so that estate can be finalised, but is that acceptable, what with Covid delays. If not, how much time should be given? Thank you for any/all replies.
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  • #2
    Anyone dealing with a deceased's estate has to give creditors the opportunity to lodge their claim.
    If the executor distributes the estate too soon they face the possibility of having to make good

    The usual way to comply with this duty is to place a deceased estates notice in the Gazette (Placing notices in The Gazette | The Gazette) and local papers, requesting creditors contact the personal representative within two months and a day.

    I would now place such notices (if not already done), not bother to recontact those who have been notified and then distribute according to the claims received at the end of the notice period.

    Just read back over previous thread and seen gazette notice already posted.
    If the deadline for making claims has passed distribute according to the claims received
    She will have fulfilled her minimum legal requirement
    Last edited by des8; 15th February 2021, 19:14:PM. Reason: read previous thread

    Comment


    • #3
      Originally posted by des8 View Post
      Anyone dealing with a deceased's estate has to give creditors the opportunity to lodge their claim.
      If the executor distributes the estate too soon they face the possibility of having to make good

      The usual way to comply with this duty is to place a deceased estates notice in the Gazette (Placing notices in The Gazette | The Gazette) and local papers, requesting creditors contact the personal representative within two months and a day.

      I would now place such notices (if not already done), not bother to recontact those who have been notified and then distribute according to the claims received at the end of the notice period.

      Just read back over previous thread and seen gazette notice already posted.
      If the deadline for making claims has passed distribute according to the claims received
      She will have fulfilled her minimum legal requirement
      Thanks very much, Des8. But what if there are, for simplicity and example sake, five creditors, each due, 400, and one of them hasn't responded with proof the debt was the mum's (rather than step dad's)? In that case, should money be distributed to others with 400 kept back for the one that's slow to reply? And in that case, what if they don't reply, does my friend have to go back to the other 4 and say, by the way, there's still 400 in the pot, so I can give each of you another 100? Or should my friend just keep the money in reserve for a set period, a year or so, and then keep it? I guess I'm asking if money can only be distributed once ALL creditors accept the proposed pro rata payout. Sorry, if this is a dumb question, and thanks again for your help with this.

      PS, the debts were being paid 5 a month via Step Change charity up until she died.

      Comment


      • #4
        Did those who did not reply actually register a claim against the estate or did the representative assume they were creditors because she knew her mother was repaying these debts (which might have been her step fathers although step change should have sorted that)?.

        In any event she could send them a wake up letter asking for a response and add that if they don't respond within 14 days she will assume it was not her mother's debt and so distribute the estate without further reference to them. (send 1st class with free certificate of posting) That will cover her duty.
        And add a tongue in cheek PS that she will be looking for a refund of all that her mother paid them.

        Comment


        • #5
          Brilliant, Des8, thank you very much. None of the ceditors registered a claim. She assumed debts were her mum's due to step change arrangement. We'll now do as you suggest. Excellent advice. Thank you.

          Comment


          • #6
            PS all the creditors have sent demands for payment, they just haven't formally lodged a claim or provided evidence that the debts are the late mum's. There are 7 debts, 3 Barclaycard one barclayloan, two Cabot financial and one arrow/moorcroft.

            Comment

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