Deed of variation and its execution

I have a situation where Daughter has died intestate and mother is the only person entitled to the estate. I am her attorney Administrator as Mother lives abroad. Mother sent me an email saying she wants another daughter to inherit her entitled and also met with me and confirmed those instructions, but then she had a stroke and has now lost capacity. Daughter is aware of mother’s intention and wants me to follow her wishes. Ordinarily, I would have prepared a DOV to the intestacy However, I have checked for guidance on this and it seems that it is advised that the variation should be in writing but there is no strict requirement for a deed. If I were to prepare a DOV could I sign as administrator and the daughter as beneficiary? I would want want a document to show the mother’s decision. BTW there is another half sister who may contest this when mother dies. Any thoughts would much appreciated. Thank you.

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As your client has lost capacity, is the power of attorney she granted to you still valid, or has it lapsed. If an E&W power, I suggest it will have lapsed.

Even if valid, as mother lives abroad you would need to consider the situation in her own jurisdiction – the variation may give rise to a tax liability in that jurisdiction, or fail to comply with any legal requirements by which she could gift the assets in question, or that must be followed when a gift is to be made by an incapacitated individual in that jurisdiction.

In any event, if the variation were to be submitted to HMRC signed by an attorney administrator instead of the beneficiary, I doubt it would be accepted as effective under s.142 IHTA 1984.

Paul Saunders FCIB TEP

Independent Trust Consultant

Providing support and advice to fellow professionals

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Hi Paul

Thanks for your reply.

There is no Inheritance Tax as the gross estate value is in under £500k and 2xNRB.

M lives in Denmark and the daughter is in the process of applying for her guardianship. Can she sign on M’s behalf and herself as the beneficiary?

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The power of an attorney to make gifts is extremely limited. Gifts would include the making of a Deed (Instrument) of Variation. An attorney under a power cannot execute a DoV. An application to the CoP would be necessary. I believe the current Guidance is that of the Public Guardian practice note PN7.

Malcolm Finney

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Thank you Malcolm.

I appreciate what you have said. Mother and daughter live in Denmark. Daughter is applying for guardianship in Denmark and therefore a COP application is not required.

I have letters of admin appointing me as M’s attorney administrator and M’s intention was to execute a DOV but now that she has lost capacity, she cannot sign a DOV. As I am aware M’s intentions I want to consider how I can achieve this without her signature to a DOV? Could I omit M’s signature, so it is signed by me and daughter?
Could I also obtain a separate indemnity from the daughter?

The risk is that the other half daughter makes a claim when M dies. I am told that she has been inform by M and accepts the position.

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IHTA 1984 s142 requires that the instrument must be in writing “made by the persons or any of the persons who benefit or. would benefit under the dispositions…”.

So I don’t think you can as you suggest “omit M’s signature”. Beneficiaries signatures are not strictly required in any. event; so daughter signing is of no help.

Malcolm Finney

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