Hi - I would be very grateful if anyone could advise on how to identify / evidence our client’s beneficial interest in a number of properties in the following situ - I have to admit it’s perplexing me so any help is appreciated:
a number of buy to let properties were purchased by client, brother and mother a few years ago as tenants in common equally. All registered at HMLR accordingly. No issues there.
Mother died two years or so, Her Will left her interests in the properties to the above two brothers. However, the solicitor who administered the estate failed to remove mother from the title, and it appears there is no supporting evidence as to who now owns the respective beneficial interests in the property.
The solicitor refuses to complete this work without further payment.
Our client now wants to leave his interest in his Will to his wife, that brother and also a sister equally. So, my questions are:
It seems to me on my limited knowledge of property law, there should have been declaration of trust documents drawn up to specify each parties beneficial interest in the properties. Otherwise, how would the executors know what share of the properties is to pass to each beneficiary, and further down the track how could the new owner evidence what their interest actually was?
Would you agree, or is there another mechanism? For example, is ownership determined purely through tracing the journey of interests passing via the respective Wills over time?
If our client refuses to instruct that solicitor to write such dec trusts, I have always been led to believe that a dec trust is reserved activity and not open for an unregulated company such as ours to write, even though no transfer of ownership or interest has taken place - would you concur?
Any and all opinions / comments would be very much appreciated. Thanks.
One more point - if someone could kindly refer me to any book, material on this subject, that would also be helpful.
An essential step is for the relevant parties, who are apparently all alive and adults, to execute a declaration of trust with detailed recitals clarifying the beneficial ownership position. If the evidence on which it is based is cogent then it should be acceptable to HMRC, as having no tax consequences of its own, and HMLR. There are established procedures for altering the title at HMLR if one of the legal owners dies.
For reserved activities see https://legalservicesboard.org.uk/enquiries/frequently-asked-questions/reserved-legal-activities. Preparing a declaration of trust is covered: “preparing any other instrument relating to real or personal estate for the purposes of the law of England and Wales”. This is prohibited even if not “by way of business” as in s22(1) FSMA 2000. I prepare my own but I know what I’m doing after 50 years at it but not even pro bono for anyone else who might sue me as I no longer have an AML supervisor or PI cover. I engage a conveyancer to do my own HMLR work even though I do know what I’m doing but was never a specialist. If your client doesn’t get on with the probate solicitor get another one. If they are looking not to pay anyone at all, I suggest a psychiatric referral.
I won’t recommend a book just as I would not recommend a self-electrocution manual.
Thank you Jack for your reply - appreciated but with the greatest of respect I won’t be suggesting my client seeks a psychiatric referral - he’s far bigger than me.
My favourite form of dispute resolution was physical violence, until the probability ratio of success turned against me, caused by factors not dissimilar to the one you cite. Sic transit gloria mundi.
As your sense of humour is intact I would recommend Declarations of Trust by Catherine Sanders. Wildy’s has the 5th edition but the 6th comes out in June. The new one will be cheaper at £89 for the paperback but the price of the earlier one at £123 includes a CD Rom. The 4th edition which I have is priced on Amazon at £361.78 plus £3.78 p&p. or £608.16 + £2.80. My previous health warning remains in full force, though you cannot plug the book in to the lecky.
Thanks for the book recommendation Jack - appreciated and will buy. Although I won’t be able to use the info it’s always good to know and at least I can refer on. And yes somehow sense of humour just about still intact. And nice to communicate with someone who also has one…sense of humour that is.