Executor duty to creditors?

Hello all

I am dealing with an insolvent estate. It has come to our attention that the deceased the year prior to his death transferred his half of his house to his wife and co owner for no money or monetary value. Wife is Executor. What duties does she have to inform creditors of this transaction?

Has the widow actually taken the grant?

If not, as she is conflicted I suggest she should renounce and leave it to the creditors to take the grant.

If she already has the grant, then she should liaise with an insolvency practitioner to ensure that she acts in accordance with the insolvency rules when collecting in and distributing the asses of the estate.

It may be that she can raise finance, using the house as security (?), to cover any shortfall in the insolvency.

Paul Saunders FCIB TEP

Independent Trust Consultant

Providing support and advice to fellow professionals

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Thank you for your reply. She hasn’t taken the Grant. The net liabilities are relatively small £20k so not sure if creditors would want to take the Grant?

The Law Society provides some guidance on insolvent estates Administering insolvent estates | The Law Society.

It begins ominously:“Personal representatives and their advisers face particular problems when administering insolvent estates. They risk personal liability if they fail to comply with the requirements of the Administration of Insolvent Estates of Deceased Person Order 1986 (Insolvent Estates Order).” As regards transfers at an undervalue only a trustee in bankruptcy can challenge them but may be appointed by a creditor if not by the PR. As executor and beneficiary of the transaction she is in a conflicted position and should take care that she does not do or fail to do something she might regret. I suggest specialist advice would be a good thing.

Jack Harper

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