We have a case where the 6 months from Probate has elapsed. However we are aware that a daughter may make a claim. Is there a time limitation for her to ask leave to appeal out of time? ( Bhusate v Patel &Others 2019). How can we protect the executor who is not a beneficiary?
There is no specified time limit for making an application out of time – it will depend upon the circumstances. Bhusate is seen as a rare example. Without good reason for the delay, the court may well reject an application outside of the 6 month window.
Whilst a claimant has 6 months within which to issue their claim, it needs to be borne in mind that the claim is valid for service for a period of 4 months after the issue date. Accordingly, I would caution the executor against making any distribution within 10 months (plus a week to allow for postal delays), in case a claim is both issued on the last permissible date and served on the last permissible date.
Paul Saunders FCIB TEP
Independent Trust Consultant
Providing support and advice to fellow professionals
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You can get insurance for an earlier distribution.
Yes as long as the executor waits the 10 months, he is protected but of course the beneficiaries could find themselves having to share their inheritance with a claimant if a similar case to Bhusate was to arise. Not particularly palatable if they’ve already spent it!
Patrick Moroney Bwl solicitors
Whilst not disagreeing with proceeding with caution, any distribution by the PRs after the 6 month period post the date of grant of probate may be made without any personal liability (whether or not the courts agree to a time extension). The PRs are also able to recover distributed property.
Malcolm Finney
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With reference to Malcolm’s post, my understanding is that PRs do not gain any protection against personal liability when making a distribution once a claim is issued within the 6 month window. It is only if the claimant fails to serve the claim within the 4 month window for service (leaving aside service outside of the jurisdiction) that the potential for personal lability falls away.
Unless a potential claimant is willing to provide a satisfactory assurance that they have not issued a claim within the 6 month window, I would be wary of even considering a distribution within 10 months of the date of the grant.
Paul Saunders FCIB TEP
Independent Trust Consultant
Providing support and advice to fellow professionals
Thank you
Thank you.
Do you mean within the 10 months, or generally going forward, as in many years to come for a Bhusate time case?
The insurance companies I have approached will not do the Bhustate time insurance.
Section 20 of the 1975 Act isn’t qualified so as to deny protection where distribution takes place more than six months from the Grant issuing but within 10 months.
My reading of s.20 is that the protection it affords to the personal representatives is qualified, in that it only provides that a PR shall not be liable if they make a distribution after the 6 month period without taking into account either the possibility of a court authorising the issue of a claim “out of time” (s.20(1)(a)), or that a court might vary an existing order (s.20(1)(b)).
S.20 I(PF&D)A 1975:
(1) The provisions of this Act shall not render the personal representative of a deceased person liable for having distributed any part of the estate of the deceased, after the end of the period of six months from the date on which representation with respect to the estate of the deceased is first taken out, on the ground that he ought to have taken into account the possibility—
(a) that the court might permit the making of an application for an order under section 2 of this Act after the end of that period, or
(b) that, where an order has been made under the said section 2, the court might exercise in relation thereto the powers conferred on it by section 6 of this Act,
but this subsection shall not prejudice any power to recover, by reason of the making of an order under this Act, any part of the estate so distributed.
Paul Saunders FCIB TEP
Independent Trust Consultant
Providing support and advice to fellow professionals
My earlier reply reflected I(PFD) A 19785 s 20, namely, that protection is granted to PRs if a distribution is made post the 6 months period even if an out of time claim is successfully lodged.
Malcolm Finney
@PaulSaunders, we are in full agreement with what section 20(1) provides for.
@CorranCaley has said that they are aware that the daughter may make a claim. Anyone with standing may make a claim, but that is very different from a situation where a person with standing has notified the PRs that they have made a claim but not yet served their claim in accordance with CPR r.75. Para 3(1) of chapter 12 “The position of the personal representatives in claims under the 1975 Act” of Inheritance Act Claims: Law, Practice and Proceedings, implies that section 20(1) would offer protection to a PR who distributes after six months have elapsed and where they have been notified of a claim but where service has not been effected. It goes on to say that even allowing for section 20(1), it would be prudent not to distribute without permission of the court, which is almost always going to be more effort and more expensive than waiting another 4 months. From what @CorranCaley has said, the daughter has not even gone as far as notifying the PRs that she has issued a claim. I do not see why section 20(1) would not offer them protection in the circumstances (e.g. there mere possibility that she may bring a claim).
Thank you very much.