Executor. do's and dont's

[blossom12]

The week after my father died my sister as executor closed his accounts (small estate so no probate necessary) and passed the money in the Nationwide account to my brother. She did this very quickly and before ensuring all debts had been paid. I have no idea why they agreed this between them, no one consulted me, and she will not explain her action.

There are three beneficiaries - myself, her and my brother. Certain matters have held up the finalising of the estate which means my brother has had this sum for over a year now and amounts to half of the total estate. (I am confident he would return whatever money was rightfully mine., he said he has it for 'safe keeping'.)

Unfortunately due to certain matters my sister is proving very awkward and I feel I need to remind her of her duties in law.

Did she act correctly in doing this? Do I have any recourse in law on this?

I would also like to know the name of any Act that covers this.

[wales01man]

Re: Executor. do's and dont's

How much money is involved and who is owed money?

[enaid]

Re: Executor. do's and dont's

The executor or personal representative can be held personally financially liable for any loss resulting from a breach of their duty, even if the mistake was made in good faith. This could cover failing to pay off debts, liabilities and any tax due, not settling claims against the estate or a failure to identify and correctly distribute assets (including those initially not known about) to the beneficiaries (those entitled to inherit as per the deceased's wishes).

[blossom12]

Re: Executor. do's and dont's

Thanks for the reply.

In this particular case I am trying to find out is if she had any right to pass this amount (£7,000) to my brother before she had settled any debts, bills, etc. After all, it was only a week after my father died.

She is proving awkward over a totally different matter which arose subsequently and is acting very arrogantly, informing us that she can act as she sees fit as she has the legal right to do so.

I am therefore trying to counter attack by seeking advice which will allow me to point out to her that she has acted in breach of her duties.

[wales01man]

Re: Executor. do's and dont's

Did she get letters of administration and fill in inland revenue forms or has she just decided to take the money

[blossom12]

Re: Executor. do's and dont's

Did she get letters of administration and fill in inland revenue forms or has she just decided to take the money

She was named executor in my father's will. She didn't need to get probate at the estate is below the threshold and HMRC forms were completed.

She hasn't taken the money, she closed the Nationwide account and gave the remaining balance to my brother who was here for the funeral but lives in USA. I have no idea why this was done but presume it was because he is in the States and seemed easier. However, it could be seen that she had distributed funds before even completing the tax forms and paying any outstanding bills.

I really need to know if she has committed an offence here as I need some concrete evidence of how she has acted as executor.

[stevemLS]

Re: Executor. do's and dont's

Debts have first call on an estate after funeral expenses and tax (no tax due here).

£5,000 is the usual threshold for a "small estate" in England.

The main duties of the Personal Representative (Executor/Administrator) are in Section 25 of the Administration of Estates Act 1925, the first one being to gather the estate and "distribute it according to law" which means pay the debts and distribute the residue according to the will/intestacy rules.

[wales01man]

Re: Executor. do's and dont's

Government probate rules are sum below 5k don't need letters of administration you state 7k so they should have been applied for . Somethings wrong here

[enaid]

Re: Executor. do's and dont's

Nationwide probate rules

£5,000 - £30,000

We will require the personal representative to complete our form which will require a solicitor's signature in order to release the funds. Once this has been given to us, the funds will be released as soon as possible.

I am presuming this was done for funds to be released

[stevemLS]

Re: Executor. do's and dont's

The limits on small estates are set out in the Administration of Estates (Small Payments) Act 1965 and the Administration of Estates (Small Payments)(Increase of Limits) Order 1984 - different types of payment have different limits, but the aggregate should not exceed £5,000.

There are no specific offences created by the 1925 Act but an Executor remains personally liable if they do not perform their duties according to law and can be convicted of theft from the Estate.

[enquirer]

Re: Executor. do's and dont's

... she closed the Nationwide account and gave the remaining balance to my brother who was here for the funeral but lives in USA. I have no idea why this was done but presume it was because he is in the States and seemed easier.

If the money is now held in a US based account, it's in a different legal jurisdiction.

[blossom12]

Re: Executor. do's and dont's

Nationwide probate rules

£5,000 - £30,000

We will require the personal representative to complete our form which will require a solicitor's signature in order to release the funds. Once this has been given to us, the funds will be released as soon as possible.

I am presuming this was done for funds to be released

Yes, this was all correctly done and Nationwide released the funds. Probate wasn't required at the estate was under £15,000 in total.

I want to write to my sister and state something about giving this sum to my brother before paying the final bills, etc, was not correct and really amounts to him receiving his share before the estate was settled.

Am I correct in that and can I rebuke her on that point?

[wales01man]

Re: Executor. do's and dont's

HMRC website states estates of 5k where does the 15k figure come from although probate is not needed Letters of administration are ,
I think there is something amiss here the Bank may give out the money but it cannot be distributed until all the legalities are done

[stevemLS]

Re: Executor. do's and dont's

Quite, releasing funds to the Executor/Administrator without sight of the Grant of Representation is a different matter to distributing them.

Probate and Letters of Administration just entitle the PR to deal with the estate, one confers no greater authority or authority to deal with different sizes of estate than the other, the first is where the deceased died with a will, the second without.

[des8]

Re: Executor. do's and dont's

An executor (ie personal representative named in a will) only needs to obtain a grant of probate if the deceased's estate includes real estate &/or shares.
If holders of the deceased's funds (eg banks, building society etc) are willing to release the funds without seeing a grant of probate. the executor will not need to obtain such a grant.
There is no particular limit, it is up to the individual organisations
The grant of probate is only formal confirmation that the personal representative has authority to gather in and distribute the assets.

However it may be better for the executor to obtain the grant when dealing with high value estates.

That a grant of probate is not necessary is confirmed @https://www.gov.uk/wills-probate-inheritance/overview where it is stated: "You don;t normally need a grant if the estate doesn't include land property or shares" The 1965 Act is often misquoted.

Regarding the lodging of the assets with the brother, this is entirely lawful.
The executor has to keep the estate safe until distribution is made, but there is no need to earn interest.
It is up to the executor to do this as she sees fit.
Of course if it goes wrong and she loses the assets (US based brother says thanks and doesn't return the assets :tinysmile_cry_t she is personally liable and can be sued by the beneficiaries.

Just finalised an estate of c£19,000 without probate and HMRC perfectly happy:tinysmile_grin_t: