Monthly Archives: July 2016

Appointing Executors and Trustees: Who should I choose?

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Appointing Executors and Trustees: Who should I choose?

 

One of the initial considerations, and a very important one, is deciding who to appoint to act as Executor under your Will or as a trustee for any trust whether in lifetime or in your Will.

 

The roles of Executors and Trustees are onerous and place a great burden on the person appointed to act in accordance with strict fiduciary rules and duties. It is important to remember that Executors and Trustees may be held personally liable for any negligence or loss which may occur when undertaking their duties.

 

When deciding who to appoint, it is important to strike a balance between appointing someone who you know and trust to fulfil your wishes whilst also ensuring that the people you appoint are fully aware of their responsibilities and are able to carry out their duties competently

 

One common pitfall is appointing various family members to act jointly. It is easy to overlook potential problems which may arise further down the line when family members are forced to act together. Differences of opinion and personal views can often lead to disagreements which in turn can have a severe impact on the administration of the estate or trust, especially where all parties are required to agree or act unanimously.

 

One easy way of avoiding such confrontation is to appoint a professional Executor or Trustee. Many people may feel uneasy about appointing a professional organisation as they feel the family may lose control but this does not have to be the case. A professional can be appointed alongside other individuals or as a reserve. This allows the family to retain control whilst providing flexibility by ensuring that they have access to professional support and assistance if and when required.

 

For more information on the appointment of a professional Executor or Trustee then please contact the Society of Will Writers.

Five things you should do if you can’t find the Will

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Five things you should do if you can’t find the Will

You think you are the executor of the Will, but you cannot find it anywhere in the deceased’s possessions. What should you do?

If you cannot find it, the court may either reject its existence or presume it was destroyed and revoked. To help prove the validity of a missing Will, try the following.

  • Contact any banks, law firms or other professionals the deceased used. They may have a copy. Certainly ask the Will writer. You may be able to find useful paperwork from the Will writer in the deceased’s paperwork even if the Will itself is absent.
  • Check the National Will Archive and  the Certainty will register. They may have a record of the Will: but note, in the UK there is no obligatory “central register” for Wills.
  • Ask family and friends, or professional contacts of the deceased, whether they might know where it could be. Ask whether the deceased had any changes of heart recently. Ask after the identity of the witnesses to the Will.
  • If you know who the witnesses are, try to gather as much information from them about that Will as you can: where and when it was attested, its content, any record or recollections they have which prove the time and place of the attestation.
  • If you have the witnesses of the Will, a copy of what the Will would have contained, and no proof that the Will was intentionally revoked or destroyed, you may be able to get affidavits (sworn statements) drafted for the witnesses and those who last saw the Will in order to prove the validity of the Will. Speak to SWW Trust Corporation if you reach this stage: we may be able to assist.

“Don’t leave it until you’re dead” – Severance of Tenancy

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Remember to Sever the Tenancy

Property Trusts and more specifically Life Interest Trusts are one of the more common type of trust put into a modern day Will. There is really no doubt that having a property trust in your Will is an extremely useful provision. Whilst the Trust ensures that your spouse can remain living in your home and receive any income once you pass away, it also ensures that your property is protected for your children for the future.

There are important things to remember when drafting a Will to include a Property Trust, which are crucial further on down the line. Namely, where there is a Property Trust included, a Severance of Tenancy will also need to be carried out, or the Trust will not take effect when you die and when your Will eventually comes into force.

Why is this?

Put simply, there are ultimately two ways of owning property, Tenants in Common and Joint Tenants. Most properties are owned as Joint Tenants initially, however, in order to set up this trust a property must be owed as Tenants In Common, which means that both parties own defined 50/50 shares in the property. Where a property is owned as Joint Tenants, there are no defined shares and subsequently, upon the death of one of the joint owners, the whole property automatically passes to the survivor by survivorship. Alternatively, with Tenants in Common, as both parties own defined 50/50 shares in the property, each may gift their share however they wish and leave instructions in their Will to that effect.

Where do the problems lie?

It is far more frequent that you may think, to reach the administration process once the first spouse passes away, with a Life Interest Trust in their Will, but to find that the tenancy was never severed, ultimately meaning that the Trust will fail.

There are ways of remedying the mistake, by way of Retrospective Severance, which is effectively a Deed of Variation treating the property as though it had been severed in the first place. However, this can be costly and of course incurs unnecessary costs from your estate.

It is also a frequent occurrence whereby a Will is drafted to include a Life Interest Trust and the tenancy is correctly severed at the time, but the parties then move to a new property and do not make a point of having the new property owned by way of Tenants in Common, rather than the more common Joint Tenants.

Ultimately, it is important to make sure that the correct provisions are in place whilst you are alive, in order to avoid extra costs and unnecessary action during the administration process when you die.

For further information on property ownership and severance of tenancy, you can visit the Government website by using the following link:

https://www.gov.uk/joint-property-ownership/change-from-joint-tenants-to-tenants-in-common

 

Nikki Manu

Estate Case Manager

SWW Trust Corporation