Statutory Trust

Trusts Discussion
#1

I am not a legal or trust expert. But I would appreciate views on the following.
My mother died in 1967 intestate leaving £16,000. My brother and I were born in 1958 and 1955.
My father is alive, and we wish to understand what happened to our mother’s estate and what will potentially happen to his estate.

Our interpretation of the intestacy rules that applied in 1967 is that my brother and I should have had a statutory trust fund set up of approximately £4,000 each which could be equivalent to today’s £500,000 based on inflationary figures. We have not been made aware of any trusts arising from our mother’s estate.

We wish to understand what happened to our mother’s legacy, and whether it is possible to verify the distribution.

In the light of our not benefiting from the trust fund at the age of majority, we would like to understand if anything can be done to correct matters at this very late stage.

If there are agencies that can be recommend that are able deal with this sort of matter I would be happy to contact them as well.

Richard J L Davies

#2

I’m no expert on the historical rules but I suspect that your father (if married to your mother) would have had a life interest in your trust fund so you would not have a right to anything during his lifetime. The funds should have been separated in some way but. if he was an administrator, he may have decided to skip the separation of the funds (not that this is acceptable).

I would suggest that your first port of call should be to order the grant of letters of administration (if any) from the Probate Registry: https://www.gov.uk/search-will-probate. You can confirm who the administrators were as there could have been more than just your father.

In theory, it is possible that the limitation period (which time bars a claim) has not expired for this type of claim but in practice the likelihood is that your father has the funds. It may be simplest to ask him.

Also bear in mind the possibility that any joint property would have passed to your father automatically and would not be included in the calculations of your share under the intestacy rules.

Andrew Goodman
Osborne Clarke LLP

#3

Under an intestacy in 1967 where the deceased left issue, the surviving spouse is entitled to the personal chattels, a statutory legacy (£8,750) and a life interest in a half share of the remainder of the estate. The remaining half share is given to issue upon statutory trusts, as in the fund in which the spouse had a life interest.

As Andrew Goodman identifies, the value of joint property will not be included within the estate subject to the intestacy rules (unless held under a tenancy in common).

As the mother died under the estate duty regime, the value of the trust fund supporting the life interest will be exempt from inheritance tax.

It seems to me that a discussion with the father might be the best starting point, to include identifying the nature of the assets comprising the other’s estate.

The extent to which any remedial action can be taken may depend upon whether the father was also the administrator of the estate and whether he was legally advised in his dealings with the estate.

If it is established that the father has failed to account for his children’s shares, there are a number of ways in which the amount to which they are now entitled could be calculated. If the matter went to court, I suspect the figure of £500,000 would significantly exceed what might be awarded, although you never can tell.

If the father is unable to provide a satisfactory explanation, I suggest the way forward would be to consult a lawyer, who can identify the relevant legal points and ask the father to address them (without being caught up in the emotions that will no doubt arise)

Paul Saunders

#4

I would add that since there was, apparently, a minority interest arising, then father would not have been entitled to take a grant in his sole name, there would have been a second PR.

Paul Davies
DWF LLP

#5

Thanks for your comments. We have taken legal advice as suggested.

Richard J L Davies