Beneficiary passed away during administration period

Trusts Discussion
1

Apologies if this is an obvious question but almost completed the administration for the estate of Mr A who died in March 2023. One of the residuary beneficiaries, Mr R died last month without receiving any of the inheritance due to him.

My intention is to pay Mr R’s share of Mr A’s estate direct into his bank account for it to be dealt with during the administration of his own estate.

That’s correct isn’t it?

2

You can only safely pay the inheritance to Mr R’s personal representative, and then only once they have obtained a grant.

Paul Saunders FCIB TEP

Independent Trust Consultant

Providing support and advice to fellow professionals

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3

Thanks Paul, I really appreciate you replying.

I’ve spoken to my client, who is the daughter of Mr R’s executor. Apart from the share of Mr A’s estate the only other assets were a small amount of funds in his accounts. They’ve decided despite my advice that probate isn’t required and have closed his bank accounts.

If they still intend on not obtaining probate, would you suggest getting Mr R’s executor to sign some form of statement agreeing to administer the estate correctly and indemnify the beneficiaries of his estate, rather than me holding these funds potentially indefinitely. Though in the meantime I’m hoping they just instruct me to apply for the Grant.

Thanks again
Shaun

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Depending on the risk you are willing to take and the amounts involved, you would/should insist on a grant of probate. It is the only way you can be sure you are paying the correct person.

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Mr A’s executor effectively has control of the situation. If they sat to Mr R’s executor: “I will not pay you the money until I see a grant”, is Mr R’s executor likely to say “keep it then”?

They may grumble about the time and cost, but if the amount involved is of any significance, they will likely comply. You might also point out to them the benefits (and protections) they have from there being a grant, as previously discussed on this forum.

Even should you obtain a signed agreement to administer Mr R’s estate “correctly” and an indemnity in case they do not, should it all go wrong how will your PI insurers respond to the ensuing claim?

As you say, hopefully, you will be instructed to apply for a grant to Mr R’s estate.

Paul Saunders FCIB TEP

Independent Trust Consultant

Providing support and advice to fellow professionals

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