Declaration of beneficial interest found to be invalid after death - dealing with the estate

Looking at a ‘second marriage’ situation where husband and wife purchase a property as tenants in common and then subsequently prepared wills leaving their respective share on life interest for the survivor. Shortly after purchase of the property they signed a declaration of beneficial interest setting out their unequal contributions.

Many years later the wife has now died and the declaration of beneficial interest has been obtained from the solicitor who did the conveyance when the house was purchased. unfortunately it appears that the document contained various errors and as a result is probably invalid. as it stands there is plenty of evidence to show that their intention was to own the property in the understood unequal proportions (70:30) however in order to deal with the estate correctly is it possible for the executors of the estate (Husband and the the remainder beneficiaries) to now enter into a ‘confirmatory’ declaration of beneficial interest to formalise the understood ownership share per the ‘invalid’ DoT? Can such a thing be validly confirmed following the death of one of the settlors? Or does death need to be seen as a ‘snapshot’ and any move to alter matters need to be dealt with via a DoV? In the absence of agreement from the executors/remainder beneficiaries (they might decide to dispute) , then there is most likely a case for am implied trust having always been in existence under TOLATA anyway.

Any comments on this matter welcome

No one got any views? perhaps not a neat thing to fix! Still keen to hear any thoughts :slight_smile:

I can see the attractiveness of a ‘confirmatory’ declaration of trust. It may lead to some resistance from beneficiaries adversely effected… however, that’s where the implied trust argument would come in handy, and is one way to ‘flush’ out the position of those involved. That said, why not just do a deed of variation?

I suppose either way it needs the ‘buy in’ of the beneficiaries.

My thought was that a DoV would be more secure but the solicitor has suggested that a DoV can only change the terms of the will not the underlying ownership of the asset (which is not expressly set out in the will). I am not a solicitor, coming at this as a tax adviser, but I am not sure I agree. My understanding was that a DoV redirects beneficial interest as a result of the will, but does not necessarily need to attach to the wording of the will as such…if that makes sense!

I wonder if this might best be addressed by a statutory declaration by the surviving co-owner, with a copy of the allegedly defective declaration of trust attached, setting out the intentions of the parties and confirming that he considers himself bound by the intended terms of the DoT, despite the possibility that it might be considered invalid.

Paul Saunders FCIB TEP

Independent Trust Consultant

Providing support and advice to fellow professionals