I am dealing with in estate in the following circumstances and would appreciate any assistance that members can offer.
The deceased was living with his partner, they were estranged and intended to sell their property that they owned as tenants in common once the refurbishments had been completed. Sadly, he was diagnosed with cancer and died shortly after.
His will left everything to his two daughters. As a goodwill gesture he said he would pay 6 payments of £1,000 from his estate to help his ex-partner pay the mortgage whilst the refurbishments are finished, and the house is placed on the market. The ex-partner lives in the property. She asked if her sister and family could move into the property, but the Executors said they could not.
At around the time of lockdown she moved her sister and family into the property.
She is now stalling placing the house on the market. We are hopeful that we can get things back “on track” without resorting to court action but feel we should be saying that we will apply for an Order of Sale.
As a good will gesture she has received £6000 and any of the refurbishments have been financed equally between the daughter and the ex-partner.
Can you please advise as to the estate’s position? Do we need to contribute to the mortgage? We are sure they will say that the family is not contributing but are we entitled to any rent.? If she does stall the sale and then the market drops can we claim for any loss to the estate.
I intend to involve a litigation solicitor with this if necessary, but any advice would be gratefully received.
This sounds like a really tricky situation. We have had a couple of situations in recent years where there have been some similar issues. In those cases we have worked with a really good property litigator and have dealt with them by taking the approach of ‘support’ first and ‘discipline’ second if that doesn’t work.
The executors have been supportive - they have contributed to the mortgaged and paid their share of the refurbishment. The agreement was that the property would be sold when the refurb is complete, which it seems has happened.
Ex partner is not keeping her part of the deal, so ‘disciplinary’ action is required. We have approached our similar situations in the past by reference to the ex-partner’s role and duties as a trustee.
If the partner refuses to sell then the simple threat is to remove them as a trustee and gain an order for sale. We have threatened to hold the partner responsible for the litigation fees and for any diminution in value caused by their delay. We have also insisted on receiving an amount equivalent to a notional rent to reflect the fact that the co-owner is enjoying occupation of the whole property.
With regard to the sister and her family you need to tread very carefully. We were advised not to take any rent from any occupying third party as that could inadvertently create some form of tenancy and may also be in breach of the mortgage. If we were happy to allow the family to stay there it would have been under a licence only with no rent payable. The executors have to stick to their guns here and not grant a licence and assert that the family are not permitted to stay there. There doesn’t seem to be any prospect of anyone getting any possession proceedings before a court for some time so any eviction / possession orders will involve some delay. A better approach might be to demand that they put the property on the market and if they refuse to do so then threaten proceedings based on breach of trustee’s duty and having her removed. That is expensive and those proceedings can be taken now. The threat of costs might be an effective one. The executors don’t really have any option - they have to protect the estate, so sitting back and doing nothing would potentially put them in breach of trust.
Michael McCabe
Heath Square Private Client Limited.