Out of trust?

[Nic232]

HI
Newbie here! Happy to have found you.
I'm 52, Brit, l live in France.
Back in UK - Dad died ..9/25 and left house - in trust giving my brother the right to reside in the property - ok with me, he's never moved out

I'm freaked however at idea of being the trustee as it seems pretty complex for my weary old head.

Brother and I are trying to see if we can by our mutual agreement transfer the set up to a less complex structutre - I was told by a solicitor today that we'd need seperate legal advice - so I'm going to try to move forward that way - any advice for me would be welcome!!
Nicky

[atticus]

Why is your young head weary?

The solicitor almost certainly meant separate professional legal advice.

Please understand that all jointly owned properties are owned on 'trust' terms; that is how English property law works. I suspect that you may in fact be trying to change from a legally simple set up to something more complicated. Is the present position that your father left the house jointly to you and your brother, on condition that it is not to be sold so long as your brother lives in it?

[Frank1]

A property trust in a will is a legal arrangement that dictates how property is managed after the owner's death, providing control and protection for beneficiaries
You have been appointed trustee to manage the property until your brother moves out when it can then be sold.
Do the trust terms state who is responsible to pay for the upkeep of the property?
As it appears your brother intends to continue to reside at the property it really should be him. Is this the problem? The trust terms fail to cover costs of property maintenance.?

[Nic232]

Thank you so much for your replies.

The trust states that my brother is responsible for the bills and maintenace. Yes - all clear it's his job and he accepts that no problem. I'm afraid though that as trustee I have been signed up to a role I don't have a clue about and that if for whatever reason my brother can't pay - I need to step in.

[Frank1]

Trustees can vary the terms of a property trust with agreement of the beneficiaries of the property.
If your brother is in agreement to amend trust terms so that he has sole responsibility for property maintenance including financial upkeep. As you are living in France it would be difficult for you undertake property management.

[Nic232]

I'm sorry - I know I'm not explaining clearly. I feel so in the dark and I admit I am having actual anxiety about all this. I'm trying to upload the will - I hope it's readable.

I've always known brother would stay in house should we still have it on dad's death - we do.

I'm fine with that. He's always lived there, and stayed through the tough years of mum and dad's decline into advanced old age. It's only right he gets to stay there now.

My concern is reading about my role as trustee I fear I could someday be responsible to pay bills he can't. I know it's slim risks that scare me - but it's not impossible.

My brother doesn't have a job, isn't looking for one, and had limited funds to keep living in the house.He's 56. Leaving it will be a momental life change for him. He is emotionally extremely attached to the house

He also has a dsimal lifestyle - health isn't his concern.

So I worry as trustee down the line there may be unpaid bills - which as trustee would be my problem. There's no funds - the trust asset is the house.

For now he's ok for billls - but in 10 years? today he's mentally ok - but if he has a stroke? loses mental capacity? I have to take charge of unpaid bills? maybe facing bills on a house 1000km from me with the beneficiary non compus and unable to agree to a sale of the house? My solicitor agreed in our Teams call that yes that is actually a risk and suggested I suggest LPOA to my brother. BUt he's not terribly easy - he tends to get angry with me when i talk about it - and says I worry too much.He got angry too when I asked if he could make a will. I know I don't have spare cash waiting to be used if I have such woes - what - 5, 10 - 15 years from now?

I asked the solicitor if they would step into the role forced on me as trustee and be a professional trustee- sure she said - just you need to pay the fees upfront. I don't have that kind of money. Brother reacted furiously also at idea that someone other than me is trustee. Said he's prefer to scrap the trust . The volatile edge he has helps nothing.

Also - if I understand rightly - should I die before him - he'll have to pay a pro trustee too - he honestly doesn't have the money for that even if he was agreeable to have a pro trustee.

The idea of moving the trust to another legl structure if becuase it seems like the trust is complicated and in another legal structure we could set out the same stipulations - bro lives in house, he pays bills, house is sold if he can't pay bills,

Am I wrong? Are there straighforward ways to cover my 4am fears like brother incapacitated and me paying court fees for the right to sign for a sale sometime in the late 2030s?

I did have a Teams call with the solicitor who wrote the will with dad - she said it's generally a good thing - just get bro to get will / LPOA - but in fact that's easier said than done as he doesn't really feel like doing that. I emailed her after to ask he if she could summarise our talk as it's alot to take in - she said ok - £750 + VAT.

I am very happy to have found this forum and thank you so much for being there - it's a help already to say all that!!

[Frank1]

Where there isn't a will, and your brother doesn't have children, under the rules of intestacy, as his only sibling you should inherit his estate (50% of the property) if he dies before you.
If he loses mental capacity without a LPA in place, the court of protection can appoint a deputy to manage his affairs, welfare and finance. The deputy can be a solicitor who could also deal with the property sale if he has to go in a care home
Will he agree to becoming solely responsible for the upkeep of the property?

[Nic232]

Thank you.

Yes, he agrees to being responsible for upkeep.

My concern for himl having no will is that as trustee I pay council tax, utilities, insurance while probate would drag slowly on. I just fear paying bills in interim.

Likewise with lack of LPA - solicitor said going through court if I had to to appooint a deputy would cost a bomb. It's my fear - and why I want out of trustee role but it's looking like that is another quagmire of very complicated things to understand. I am so alone in this. I can't talk to my brother easily as he gets so so angry about anything compliacted - and this is a whopper.

Isn't it stated in dad's will that he is solety responsible for the upkeep?

[Frank1]

If you are worried that your brother won't be able to pay future bills you could consider equity release.
As the youngest joint owner you will need to be 55, so a few years away yet.
The equity should be split 50/50 meaning your brother will receive a lump sum.

[Tofros]

Just to be clear, was the house owned 100% by your Dad. The will contemplates his ownership being full or partial. You mention your Mum who I assume predeceased your Dad. Was your Mum a Co-owner and if so was it as a joint owner or as tenant in common? What did your Mum’s will say?

Assuming it was 100%, your Dad has left the house equally to you and your brother subject to a right to occupy in favour of your brother. You being a trustee protects your interest in the house as ultimate beneficiary. Also, if you were to predecease your brother the trust mechanism preserves your interest in the house for the benefit your children (if any).

[Nic232]

Hello again.
I'm going to try to recap my situation - I'm currently talking also to a Trust solicitor who is proposing to do me a letter of advice for £750 + VAT. This is how I am summarising my situatiojn to him - I know I'm repeating already posted and replied to details - sorry! I am trying to work through the fog in my head . Any advice would be happily accepted!!




For context, I only discovered the trust and my role as trustee on dad's death. mum passed in 2022, the house was 100% dad's.

I'm ok with my brother staying in the house - the only asset of the trust. I know I am benficiary and by extension as are my 2 children, 18 and 21.

I am trying to underdstand what my role of trustee is and its implications. It is still very unclear to me.

As far as I understand - so long as all goes on as it is today,I have nothing to do. Brother continues to live there ,he pays insurance, utilities and council tax - all good.

What is much less clear to me is what happens if things change. My mind jumps to hopefully the least likely, but unfortunately not impossible outcomes in the future..

What happens if brother can't pay the bills ( financial struggles, illness, incapacity ) - do I have to step in as trustee and pay - given the only asset in the trust is the unsold house.
I feel worried that it's not impossible I may one day face bills being trustee - that I just wouldn't be able to afford.
While I repect and accept his right to live in the house, I fear my own financial exposure based on my understanding of this trust, and it's for these concerns I'm seeking professional reassurance - so I can start to sleep more easily again!!


Should brother and I both make wills? Could I make a UK will just to cover my share of the house, to ensure it passses smoothly to my children? I live in France.

Is it advised that we take LPOA, or another form of method, to have the power to act should the other become incompacitated?

Would brother have to employ the services of a professional trustee should I pass before him?

Could any legal deadlocks in connection to the trust potentially need a court case to sort?


In the midst of all these questions both brother and I did wonder if there's not another simpler ownership arrangement we could establish, in place of the trust. How would we go about organising such a legal step? What would the potential tax implications be, and how would we manage that

Thanks so much.

[Tofros]

Your brother’s right of occupation would end if he failed to pay the outgoings. The house was left on trust for sale subject to that right so once that right ends your duty as trustees would be to sell the property and distribute the proceeds between you.

Your brother is also a trustee and the tricky issue which could arise is that you would both need to agree that the right to occupy had ended and that the property be sold. Technically any unpaid outgoings would have to come out of his share of the proceeds.

The arrangement protects your share of the value of the house should your brother accumulate other debts or need to pay care costs in the future. The house presumably is registered with both of you named on the title and a form A restriction.

please note that this is not a life interest, merely a right to occupy which can end in the specified circumstances.

it is always sensible to make a will. There are rules in France about forced heirship so you will need to take advice about whether to do 2 wills. You can I think make separate wills for Uk assets and French assets. In the UK, provided you made a will, I believe the chain of representation rules would apply and that the executors of your will would become executors of your Dads will in your place. You should also ask your lawyer whether the will trust needs to be registered on the trust registration portal once the estate administration period gets to the 2 year mark.

I think it unlikely you can become liable for the property outgoings just by dint of being named on the title as executor/trustee.

[Nic232]

Thank you very much for your reply.

It is sound advice for my will

I will ask my brother to do also make a will.

The house will have to be registered on the trust registry according to the solicitior.

The house is registered with both of us named on the title as we're both beneficiaries

Indeed - the tricky issue is that my brother is also trustee. Should trouble arise, it is exactly the fact that he also has to agree a sale that worries me - even if it's all rosey today.

If he can't afford it / loses mental capacity - where does that leave me if he's not agreeable to a sale, and funds are locked in the unsold house.

To protect against this slim but not impossible exposure - wouldn't I do better to have a professional trustee take my place? I was quoted £1000/year if all's calm, more in more complicatd trusts. Thos would provide me with the peace of mind I'm after, wouldn't it? I sit back, pay the solicitor fees, and stop worrying about having legal and financial worries in the future?

Is there any other ways I can safeguard myself while staying trustee?

Should he have LPOA? He has told me he doesn't want that - and he only wants me as trustee - " or no trust'. he is this side of volatile.


Apologies for maybe going over old ground - do you see anotehr legal structure that would leave me less exposed while respecting dad's wishes, that I accept - I just don't want to be exposed if it hits the fan!!

[Tofros]

You need to make sure the title is correctly registered to reflect your trustee status. You are not holding it as beneficial owners as the house still belongs to the estate/trust and will continue to do so whilst the right to occupy exists.

There is little to be done as trustee for the present and very little chance of personal liability for outgoings, especially as you are not a beneficial owner yet (and may never be if the house is eventually sold directly by the executors/trustees), so think very carefully about whether it is worth paying a professional trustee for potentially many years. If you can afford the sum quoted consider putting that aside every year to save up to pay for for dealing with any later problems.

As the rules currently stand, capital gains tax will be payable on any gain over the probate value once the house is eventually sold by the trustees.

[Nic232]

Thank you very much for your reply and advice.

I will continue the process I started with the solicitor I met to register the trust - I'm just holiding off as I am still seeking to know if the trust can be moved to another legal trust - it's unclear to me if it's a good idea or how to go about doing it. I'm trying to draft an email to a Trust solicitor who is proposing a letter of advice.

I'm really stuck on the " chance of personal liability for outgoings," that I am maybe exposed to.

Yes - as it is today all is amicable enough between me and my brother -He stayed with mum and dad in the house through their advanced years and all the hell of caring for them - I came often, but he was there all the time. Infact he has never moved out of their house - in 56 years.

but he is unemployed and not looking for work, he smokes pot nightly, and is known for real outbursts of anger - towards me.

I manage it - but I don't like it, the stress is real. Family, and all. But I am worried that I am finacially connected to him now and will stay that way from now on as it stands.

He's got zero income and so is draining savings ( recently boosted by inheriting dadfor the high outgo on the 4 bedroom house he's been gifted free residency in - and it can't last forever.

Maybe he'll accept the inevitable whenever his funds get low enough and he'lll accept he has to sell the house and rent a small flat on the less leafy side of town - or he won't. he's 56 - never left the house, still got the same bedroom as when he was a kid...

How on earth would I force him out if he refused even if he broke the trust contitions? Court? paid for by me??

Can I call on a pro trustee if and when things get tricky? Would a pro trustee accept to step into a messy trust?

Can I - if I do this - sit back, take no interest, pay no pro trustees fees, not ask him to get a will, to get LPOA ( he's already got furious at the suggestion ) - and just call por trustee if it all goes bad?

I have my inherited £35 000 share of dad's remaining money sitting quietly on an account - I never counted on that money - I can let it sit there and use it if ever I need to pay big pro trustee bills one day, can't I?

I'm getting a whiff of a way to the peace of mind I've been seeking for that last 6 months - tell me honestly what you think - and thank you so much for your support in this dark fog!!!