Obviously, no one likes spending money on unnecessary legal fees and it is tempting to leave the administration of a deceased individual’s estate in the hands of friends or family. As with many choices which look like a good way to save money initially, the risks of letting non-solicitors handle the administration of an estate are very real and can, in fact, prove costly both in financial terms and those of family relationships.
Figures released in July 2014 by the High Court show that claims against Executors who have mishandled a deceased’s estate have trebled in the year prior, rising from 107 in 2012 to 368 in 2013. These claims include allegations of theft on the part of an executor, negligent (careless) incorrect distributions being made or deliberately wrongful distributions by them.
Although at first sight, it might be tempting to believe that the role of an executor is an easy one to step into, this is far from being the case… Often the asset value of a deceased’s estate can be substantial, complex and diverse. The costs of having to use the Courts to correct a mistake or recover ‘misdirected’ funds after an executor has got things wrong can be substantial even if the errors are not deliberate. Also as the Court’s figures show, an amateur executor, particularly where there are connections with the family, can be tempted to make decisions that are not in keeping with the wishes of the deceased but rather based on his/her own preferences or even direct assets into their own accounts.
Appointing an amateur executor also means that the person administering the estate will not be regulated and the family due to benefit from the distribution of the estate will have no course of action to recover monies, should there be errors or theft, other than Court proceedings.
So what exactly are the clear benefits from appointing a solicitor as executor?
- Following the death of a loved one, many family members are not in a good place to deal with complicated administrative work. Appointing a solicitor as executor removes the responsibility for the job from the spouse/civil partner or family and friends at a time when they will be grieving.
- If there is a dispute, relationships within a family can be, at best, tense. A professional executor can remain impartial and fair and ensure that the administration is carried out with objectivity.
- Security and certainty: If you have a relationship with a firm of solicitors, there is continuity of executors. There will always be someone suitable to accept the role.
- Dealing with the administration of an estate has become more complex in recent years. There are penalties if actions and paperwork are not dealt with properly. A firm of solicitors has a high level of expertise in dealing with the administration of estates and this is reflected in the efficiency with which they can deal with matters
It is a common misconception that solicitors apply an uplift or value element to their charges for dealing with the administration of an estate. The Solicitors Regulation Authority does allow solicitors to charge a fee based on a percentage of the value of the estate. We do not charge such a fee, however. Our charges are based only on the actual time spent on a matter.
Executors are, of course, free to appoint Solicitor to act for them if they wish and their costs are payable from the estate. However, increasingly people are tempted to deal with matters without legal help. This leaves open the risk of inadvertent errors being made which could leave the executor personally out of pocket.
If you think this may affect you and would like further advice, please contact any member of our Tax, Trusts and Estates team in Guildford on 01483 302000 , email email@example.com or fill in the simple contact form.