A family war over who takes control when a parent dies intestate is increasingly common but costs people dear, lawyers warn.
People who make a will appoint one or more executors to apply for probate and divide up an estate, but where no one was selected to carry out this task it can lead to a power struggle and an expensive legal battle.
These disputes risk pushing up the cost of administering an estate, which ultimately comes out of people’s inheritance, explains Osbornes Law.
Dying intestate: When there is no will that appoints an executor to administer an estate, this can lead to a power struggle and an expensive legal battle.
The firm has seen an increase in siblings falling out over who should handle the probate process for parents’ estates, then turning to lawyers to prevent other family members from taking charge.
When this can’t be resolved, the courts will decide who should administer a parents’ estate. This can end up being an independent professional, whose fees also eat into everyone’s inheritance.
When someone dies without a will their assets are distributed according to Britain’s strict intestacy rules, which mean a spouse inherits nearly everything.
Osbornes offers a guide to sorting out an estate and avoiding damaging repercussions if a parent dies intestate below.
Meanwhile, executors appointed in wills can also get embroiled in family drama, and we look at how to navigate this job here.
Katie de Swarte, a lawyer specialising in will disputes at Osbornes, says: ‘A parent dying without having a will in place can be hugely stressful for families, adding a further burden at a time of grief.
‘It seems that the pressures caused by bereavement amidst the Covid pandemic has caused heightened tensions between brothers and sisters who do not trust each other with the process and cannot agree between themselves on who should take responsibility.’
Kate de Swarte: She recommends putting differences aside and nominating just one or two administrators at most
When someone dies intestate with no surviving spouse or civil partner in England and Wales, the whole estate passes to children in equal shares.
If a child has died, their share is divided among their own children if they have any.
But all surviving children have equal standing to deal with the estate and can apply for a ‘grant of letters of administration’, which is what causes problems if they can’t agree who should take on the task, explains De Swarte.
As administrator of the estate, they collect the assets, value them, pay any debts such as taxes, and distribute property according to the intestacy rules, she says.
A maximum of four people can apply, but the more who are involved the greater the amount of administration needed and the higher the legal fees, especially if they issue conflicting instructions which complicate the process, according to De Swarte.
‘These costs are generally paid for by the estate unless there is cause to settle them from an individual’s share of inheritance.
‘I have dealt with matters where agreement could not be reached between the siblings as to who should be named as administrator and so court applications had to be made for a judge to decide.
‘I have had cases where a judge has considered that what is best for the safe administration of the estate is that none of the siblings should be responsible, and will instead appoint an independent administrator, usually a professional.
‘Although this resolves the dispute it can incur higher fees for the estate and ultimately leaves none of the family in control.’
De Swarte recommends putting differences aside and nominating just one or two administrators at most, and if agreement cannot be reached going to mediation to avoid court action.
Gavin Holt: ‘Increasingly diverse family structures also have a part to play in disputes between siblings’
Gavin Holt, head of probate at Co-op Legal Services, says disputes among siblings over who should deal with administration of a parent’s estate when there is no will are very common.
‘There can be any number of reasons, such as whether the property should be sold and for what price and how it should be divided, general lack of trust, and historical tensions,’ he says.
‘Increasingly diverse family structures also have a part to play in disputes between siblings that only have one parent – the deceased – in common.
‘To resolve these issues, we would always recommend that the siblings get together and try to agree who should deal with the estate, as this will save significant time and costs.
‘Where this is not possible, it is often necessary for each of the siblings to seek independent legal advice, as any law firm trying to act for them all together would risk encountering conflicts of interest and thus having to cease to act.’
Holt says where problems are serious and agreement cannot be reached, the outcome is usually that an independent administrator is appointed to deal with an estate, but that will often happen only after a lengthy period of contention when significant costs are incurred.
‘Huge time and cost savings can be made by agreeing to appoint an independent administrator at the beginning,’ he adds.
How do you sort out an estate if someone dies without a will?
Katie de Swarte of Osbornes Law offers the following guide.
1. If your parent dies without a will and you want to handle the probate process, first check you have standing to apply. The order of priority is:
– Husband, wife or civil partner of the deceased
– Child (all children have equal standing)
– Brother or sister
– Uncle or aunt.
2. Those with priority can then apply for a ‘grant of letters of administration’.
This makes the person applying the administrator of the estate and allows you to collect the estate assets, value them, pay any debts, including taxes and distribute the estate according to the intestacy rules.
You can try to do this yourself and use the government’s website but it is advisable to instruct a solicitor as the process is not always straightforward and any mistakes could be very costly given the administrator could be held personally liable.
3. If you have siblings and you are the one applying, you will need to provide evidence that you have informed all of your brothers and sisters that you will be applying.
This will usually means providing confirmation within the necessary forms.
4. Up to four siblings can be appointed but bear in mind that the more people involved in the process, the higher the legal fees can be as there will be more instructions to take and more correspondence to send.
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Any dispute between the siblings could really ratchet up costs quite dramatically.
It is better to agree to one or two administrators at the most. If agreement cannot be reached between siblings, you will need to speak to a solicitor if you haven’t already.
5. The first step will be to try and reach an agreement via your solicitor and your siblings or their solicitor.
If this is not successful, mediation or a roundtable meeting can be facilitated by your solicitor or mediation can be arranged directly with a mediator if you do not have a solicitor.
6. If you still can’t agree, court action may be required and in line with the pre action protocol your solicitor will draft a letter before action, and your siblings will have limited time to respond.
7. If no response is provided or if a response does not progress matters, your solicitor can make a court application seeking the appointment of an independent administrator or to ask for confirmation of your appointment.
8. The court will be hesitant to appoint you as administrator over siblings with equal standings unless you can provide good evidence as to why it should be you rather than your siblings.
This usually means demonstrating why they might be untrustworthy or lack the competence required to carry out the task. Ensure you keep records and save relevant correspondence if a potential dispute looks likely.
9. The cost of getting a grant can vary a great deal depending on the size, nature and complexity of the estate.
Most solicitors will charge at their hourly rate; those who estimate costs based on a percentage of the estate’s value are rare these days.
If, however, you enter into a dispute over the estate administration and have to involve the court to resolve it, you could be looking at many tens of thousands of pounds in extra costs in dealing with the dispute.
10. Be aware, that although the judge will often rule that legal costs are taken from the estate, this is not always the case and is at the discretion of the court.
If the court believes that one sibling has behaved particularly unreasonably during proceedings, it can order some or all of the legal costs be paid only from their share.
Behaving reasonably is the key to the prompt and cost effective administration of an estate, but of course if someone else involved is behaving unreasonably, that problem does have to be addressed, which is not always easy.