Monthly Archives: October 2016

The role of an Attorney

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What can an Attorney do?

Attorneys have very broad powers over financial affairs, acting with nearly the full legal authority as if they were an “extension” of the donor.  This can make scenarios with some lay attorneys very dangerous, providing vast powers without instant recourse to legal challenge in the event of abuse. Even loving relatives can misuse attorney powers.

Furthermore, attorneys have onerous responsibilities with regard to legal duties, administration and consultation. Even a well-meaning attorney can find themselves failing their “donor” and causing irreparable harm to that vulnerable person, opening themselves to litigation. It can be detrimental to the interests of not only the vulnerable individual, therefore, but also the attorney upon whom they have imposed this burden.

A professional attorney, conversely, will have the expertise, legal acumen and transparency to ensure that the interests of the donor are entirely met, mitigating any risk of abuse or negligence that could otherwise emerge.

 

Our role as a professional attorney

We will encourage you to make any decisions for yourself but will be here to help when required.

We can help with, inter alia:

  • Opening, closing or operating any bank / building society account
  • Buying or selling property
  • Claiming and using on your behalf all benefits, pensions, allowances and rebates
  • Receive income, inheritance or other entitlement and ensure it is used in your best interests
  • Manage your tax affairs
  • Pay your mortgage /rent and household expenses
  • Insure, maintain and repair your property
  • Invest your savings to achieve the best return
  • Make gifts to your family and friends for birthdays, weddings and at Christmas or continue making gifts to your preferred charity
  • Pay for private medical care and residential / nursing home fees
  • Apply for any entitlement to funding for NHS care, social care or adaptations
  • Obtain any equipment or other help you may need

 

If you ask us, or it becomes necessary, to help with household bills and living expenses we can contact the companies concerned and deal directly with them, leaving you with the peace of mind that everything is in hand.

 

What are our duties as your Attorney?

 

Our chief duties in protecting your financial affairs are:

  • To keep accounts and protect your money
  • To comply with the directions of the Court of Protection
  • To keep your affairs confidential

 

However, crucial to these responsibilities, we need to act under a very strict duty of care towards you:

 

  • To follow the legal statutory principles imposed by the Mental Capacity Act

We have a legal responsibility to follow the legislation and to help you make decisions regarding your finances with minimal intervention. This helps you to maintain control for as long as you feel able to but with the reassurance that we are there to help you as much as you need.

  • To act in your best interests

We always have your best interests in mind when helping you make decisions or making decisions on your behalf. We take into account your views and beliefs, and may consult family and friends who also take an active interest in your welfare.

  • To only make decisions that we have the authority to make

We take into account any restrictions you may have written into your LPA. Under a Property and Affairs LPA we cannot make decisions about your personal care or medical treatment.

Society of Will Writers Annual Conference, October 2016

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Society of Will Writers Annual Conference, October 2016

The SWW Trust Corporation regularly sends personnel to meet and greet Members of the Society of Will Writers at the wonderful Annual Conference.  This year was the Society’s 20th annual conference with a host of great speakers and exhibitors to mark the occasion, and our Head of Probate, Carmen Cottingham, brought down two Estate Managers, Thomas Jordan and James Greenwood, to see the sights.

Amongst the highlights, Andy Riddle from Professional Deputies gave an informative presentation about deputyships and the common problems faced in that role. Alex Elphinston, chair of the Society of Trust and Estate Practitioners (STEP) England and Wales, spoke on his specialisms of dealing with vulnerable clients.

Perhaps the jewel in the crown was Professor Lesley King. She is co-author of Wills, Taxation and Administration: A Practical Guide, editor of The Probate Practitioner’s Handbook and the Wills and probate columnist for the Law Society Gazette. Her talk was very well received by delegates, who were delighted to have such a pre-eminent expert addressing subjects crucial to the profession.

Further presentations were given by Sally Jones (Head of the OPG Legal Team), and Solicitor and College of Will Writing tutor Mike Smith. Mike has given presentations at countless conferences and continues to impress delegates with his useful content and approach to Wills and Estate Planning.

SWWTC’s attendees also enjoyed a private dinner for members and guests  followed by some fantastic entertainment, including a table illusionist, comedian and game show evening.

The second day comprised of workshops run by Martin Holdsworth of Jones Myers, Mike Smith, and our very own James Greenwood. Hands-on debates and discussions on current Will and probate issues really gave delegates a chance to get involved and test their own professional development.

All in all this year’s conference was a resounding success, with the usual combination of education, networking and modest amounts of frivolity. We shall eagerly await the announcement of next year’s line-up.

 

Importance of planning your Will

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So you have a Will, but how effective is the planning behind it?

The importance of having a valid Will cannot be emphasised enough. Understandably, when it comes to making a Will, we would all hope to cover every eventuality, to ensure that our assets, possessions and everything we have worked hard for, go to the exact people we wish.

Sometimes, however, it is simply not possible to cover every eventuality and trying to do so can prove to be detrimental. The next most important element, on top of having a valid Will, is that the document itself deals with the distribution of your estate sensibly and that there is careful planning behind the content in your Will. Where an estate is large, you should always take into account the issue of inheritance tax, as there may be instances where despite applying exemptions, there will still be a liability.

For example,

Mrs X has an estate worth £1.3 million. It consists of 2 properties, various bank accounts and various shares and investments.

Mrs X has a full nil rate band of £325,000 and there is a full transferable nil rate band available from her pre-deceased husband. After deducting the £650,000 nil rate band, this means that there is still £650,000 liable to inheritance tax at 40%, meaning that the inheritance tax bill will be roughly £260,000.

The problem is that Mrs X had wanted to ensure that all of her assets and possessions would go to specific people under her Will, and had therefore made specific gifts of both her properties and each of her bank accounts tax free, leaving only a few small shareholdings and some small investments to residue.

As there are not sufficient liquid assets available to settle the inheritance bill, as everything has been specifically gifted under the Will, assets such as property will have to be sold.

Unfortunately, this means that although a specified beneficiary will still receive the remainder of the proceeds from the property sale after settling the inheritance tax bill; ultimately they will not receive the property itself as Mrs X had intended in her Will.

Pecuniary and specific gifts in a Will always take precedent before the estate residue, however, by not effectively planning, such as in the above example, this can put assets at risk. The inheritance tax liability must be settled regardless of whether specific gifts are to be gifted tax free.

Having a Will is important, but the next most important thing is the planning that you put in behind it. Failure to effectively and properly plan how your estate is to be distributed when you die can be as detrimental as not having a Will at all.

 

Missing or destroyed Wills

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Missing or destroyed Wills

 

Undeniably the most important document in the administration of an estate is the Will, as this outlines all of the relevant information needed to administer the estate of the deceased testator. But what happens when the Will cannot be located following death?

 

Section 20 of the Wills Act 1837 states that a Will may only be revoked by a later Will / Codicil or by destruction of the Will by the testator. So if the testator is known to have made a Will at some point in the past, then effort must be made to try and locate this document, or any copies of it and gather as much information as possible to determine what may have happened to the original document.

 

The first step will be to contact any professional organisations the testator may have had connections with. This could include a local Will writer or solicitor, or a bank where documents may be held in safe custody.

 

Sometimes a photocopy of the original Will may exist, and this can often be sufficient to enable the Will to be proven and Probate granted to the Executors. In such cases, a document known as an ‘Affidavit’ should be prepared. An affidavit is a written statement of fact, sworn under oath. Any person who may have seen the Will, witnessed the attestation, had knowledge of its whereabouts or could specify what may have happened to the Will should swear an Affidavit.

 

Once as much Affidavit evidence as possible has been gathered, the Executors may proceed with an application for Probate. It is however worth bearing in mind that each case will be judged on the individual facts and the final decision regarding Probate rests with the District Probate Registrar.

 

Similarly, a Will may have been destroyed accidentally by the testator or another party, without the intention of actually revoking it. Again, if sufficient Affidavit evidence can be obtained then it is possible that an application for Probate can be made.

 

For further information regarding lost or destroyed Wills then please contact the SWW Trust Corporation.

Life Interest Trusts in Wills

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Life Interest Trusts in Wills –  steps to ensure effective protection of the trust assets: –

A common misconception amongst the lay executor is that the Will ‘is the trust’ and to a certain extent this is true however, with certain trusts more work is required.

  • A Life Interest Trust in a Will requires additional paperwork to enable the share of the property under the Life Interest Trust to pass to the trustees (generally the surviving spouse and another). Although the Will confirms who are to be the trustees and beneficiaries the Land Registry Title will still have the deceased’s name registered against it. The trustees will need to confirm that they accept their office as trustees and the trust property will need to be legally passed to the trustees to hold on trust for the eventual beneficiaries.

 

How is this achieved? Minutes of a Trustee Meeting can be drafted which, in turn, will confirm that the trustees accept their office as trustees. At the meeting, the trustees are able to execute the necessary Land Registry document which will need to be submitted to the Land Registry. The Land Registry will update the proprietorship title for the property to ensure that the trustees are named on the title. Once completed, the trusts share of the property is protected for the eventual beneficiaries.

 

When do the beneficiaries receive their trust asset? The Life Tenant (generally the surviving spouse) is able to live in the property for the rest of their life. If the property is sold (of which the surviving spouse is co-owner) the surviving spouse and the trustees can purchase another property. Again, the life tenant can have full use and enjoyment of the new property. If there are any excess sale proceeds the surviving spouse will take their share of this outright but will also benefit from income generated from the trusts excess sale proceeds. The new property, of which is part owned by the trust will continue to be held by the trustees along with any excess sale proceeds for the eventual beneficiaries. Upon the death of the life tenant the beneficiaries will then be entitled to their share of the trust asset along with the excess sale proceeds that we held by the trustees.

 

If you would like further information on how to establish a Life Interest Trust after death please contact one of our team: 01522 581570.

Why your IFA should speak to us

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Why your IFA should speak to us.

If you have an independent financial adviser (IFA) to help with your investments and wealth planning, they may also be able to help with legacy planning for your family and for future generations. A significant part of this involves Wills and trusts planning.

It is possible that your IFA is a Will writer or provides these services. If so, they should be able to discuss with you your options for trusts and wealth management further down the line.

One important question to consider, though: who is going to administer to your estate, prove your Will, and look after these trusts?

It is important to talk to your IFA about trusteeship and executorship options, including appointing a suitable professional for the purpose. You and your adviser should have confidence that your careful legacy planning is not wasted by choosing an inappropriate trustee or executor.

We provide specialist executorship and trusteeship services, covering everything from accounting for estate assets, paying the tax, proving the Will and paying out legacies, to setting up and managing the trusts you need in your Will. We can work closely with your IFA to ensure that your wealth strategy is carried out to the letter.

This includes ensuring that trust monies are used as you would wish: we follow letters of wishes very carefully, ensuring that the outcome you truly want from your Will can be fully realised.

We are safer than instructing an individual executor or trustee, whether they be a lay person or a sole professional. Our company status and insurance provides long-term protection. We are also less expensive than law firms, and more specialised in these precise fields.

Speak to your IFA at your next appointment about your Wills, trusts and legacy options. You will find that the SWW Trust Corporation can help you and your financial adviser make a long-term plan that gives you confidence and peace of mind.