When a person dies, it takes some time to deal with their estate and this can cause financial hardship to those around them. Where there is a dispute over an estate, it will inevitably take even longer to release funds. This can be devastating to someone who was financially reliant on the deceased because they may suddenly find themselves without enough money to pay the bills.
If someone is bringing or contemplating a claim under the Inheritance Act, there are two things which might help in this situation.
Firstly, since 2014 it has been possible to start an Inheritance Act claim before there is a Grant of Probate. If the executors are taking their time (possibly deliberately in an attempt to head off any potential claim), then the Claimant can proceed anyway. However, once the proceedings have started, they will continue at the usual speed and so can take some time to reach a conclusion.
Secondly, it is possible under s5 of the Inheritance Act for a Claimant to make an application for interim maintenance from the estate (for example to cover bills). The Court has the power to award such sum or sums for financial assistance as it considers to be reasonable. (Whilst this does not appear to include the provision of property, it is not unusual for the executors to agree that someone remains in a property whilst their claim is determined particularly where they have a very strong claim).
In order to make an application for interim maintenance, and Claimant must:
- Have made an application for an order under the Act (in practice, the main claim and the application for interim maintenance can be made together);
- Have a need for immediate financial assistance from the estate.
There must also be sufficient assets in the estate to pay any interim maintenance which is ordered. However, the personal representatives will not be liable if they pay pursuant to an order and then later discover that there is not as much money as they thought and not enough to continue paying/to pay other debts (unless at the time of making the payments the personal representatives had reason to believe that there would not have been enough).
In order to succeed in an application, the Claimant must have a strong claim and the Judge will consider the merits of the claim when deciding whether to award interim maintenance. The Court can put conditions on any maintenance awarded (for example to specify what it must be spent on) and will usually order that it is paid on account of any future award. However, it is very rare to find that the Claimant is ordered to repay interim maintenance in the event that the claim is ultimately lost.
* Disclaimer: The information on the Anthony Gold website is for general information only and reflects the position at the date of publication. It does not constitute legal advice and should not be treated as such. It is provided without any representations or warranties, express or implied.*
Those who have been left out of a will, or who have not received as much as they expected, may be able to make a claim under the Inheritance (Provision for Family and Dependants) Act 1975 for reasonable financial provision from the estate of the deceased. What is the role of the executor in such circumstances, and what happens if the executor is also the beneficiary?
The executor, in their role as executor, is expected to adopt a neutral stance on the claim. The executor will be a defendant to proceedings if they have to be issued, and will have to file a witness statement setting out details of the net estate, but is not expected to go much further or to actively defend the claim. Of course, there are occasions where it might be necessary to give further evidence – for example where the claimant wants further information about assets or liabilities of the estate – but as a general rule, the executor is expected to simply abide by any order of the Court.
So long as the executor remains neutral, they will be entitled to their costs of the matter out of the estate on the indemnity basis (Alsop Wilkinson v Neary [1995] 1 All ER 431).
Where an executor is also a beneficiary, they may be providing the neutral information required in their role as executor, but choosing to provide further evidence and a defence in their role as beneficiary. A beneficiary may well want to defend a claim under the Inheritance Act, either by questioning the evidence put forward by the Claimant or by putting forward a competing claim. They will not be taking a neutral stance, and indeed claims of this sort can be extremely emotional and very hard fought.
When the executor is acting in their role as beneficiary to defend the claim then they will not automatically be entitled to their costs from the estate. As with most civil litigation, costs tend to follow the event and so there are risks for beneficiaries when defending. If acting for both executor and beneficiary, it is worth keeping a note of the separate costs (the costs of the executor should be quite limited) so that they can be paid from the right pot at the end of the case.
As for representation, prima facie there is no reason that one solicitor cannot act for a sole executor and beneficiary and indeed this should keep the costs of the matter down. However, where there are multiple executors/beneficiaries, solicitors should be very careful to ensure that there are no conflicts of interest. A conflict might arise where one beneficiary wishes to defend and another does not, or where one wishes to bring a competing claim, and if a conflict is not identified at the outset then the solicitor may end up not being able to act in the matter at all.