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Common practice in negotiations between parties in a will

Common practice in negotiations between parties in a will

Postby frobisher » Thu Aug 18, 2016 7:55 am

There is a widow and her two stepchildren involved. Her husband (their father) died over a year ago and there have been legal wranglings ever since. Relationships between the two sides are hostile. Marriage was 17 years.

Widow was originally an executor, but has been removed via court action by the stepchildren who are also executors (but oddly none of them knew that a codicil to the will existed that appointed the stepchildren as executors until several weeks of the widow acting as sole executor).

The reason for removal was that the widow acted wrongly (unintentionally but still wrongly) in her handling of estate funds thinking she was sole executor in the early stages. She accepts this and all parties are now waiting for probate to be granted.

House has declaration of trust, broadly a 50/50 split.

Will puts everything into a discretionary trust, including the deceased's 50% of the house. Assets from accounts, shares, etc. approx £100K.

Widow and stepchildren are named beneficiaries of the will trust.

Widow is (currently) sole trustee of the will trust as other trustee has fully renounced/resigned.

As part of legal action to remove widow as executor, stepchildren demanded an account of estate funds to date. This action is still ongoing, although adjourned for negotiations between parties to see if a settlement can be reached.

Widow used some of the estate funds to carry out repairs to house (deceased had booked workmen in prior to his death, widow had no other funds to pay for work) - stepchildren dispute that this was legitimate expenditure along with some other maintenance work to house/land.

Widow has spent (from early days as "sole executor") £29K of estate funds, of which £17K (including house maintenance as mentioned above) is disputed by stepchildren.

Stepchildren have been informed that unless reasonable settlement can be reached, widow will file 1975 act claim.

Stepchildren, after succeeding in removal of widow as executor, sneakily attempted to get court order written by their barrister to include removal as trustee. This draft was quashed by the court prior to finalisation. Originally all parties believed stepchildren to be trustees too (no-one had read the will properly, rather incredibly, including the widow's solicitors) and only since this court case has it come to light that the stepchildren are not trustees, only executors and named beneficiaries of the will trust.

Stepchildren will quite possibly launch separate action to remove Widow as trustee too and hope that court appoints independent trustees that will be sympathetic to them.

Stepchildren still maintain (rather optimistically) that they are trustees of the will trust. A barrister appointed by the widow for advice has stated they are not. Upshot is that if things don't change and probate is granted, stepchildren will have to hand over all estate funds to the widow's control as sole trustee of the will trust. Including their 50% share of the house from the declaration of trust.


Most of the above is background as I believe it helps to understand the history. Currently the stepchildren are belligerently arguing/challenging the widow's account of estate expenditure. Widow is fed up of arguing and is happy to state that all can be treated as an advance on her eventual inheritance such that none is treated as legitimate estate expenditure, but stepchildren seem to want to force it to a final hearing - for what purpose has not been stated.

Widow has made offers to settle whereby she gets the remaining liquidated money from the estate (100k - 29k already had - legal costs in all likelihood which will be considerable). Stepchildren are steadfastly ignoring these offers.

Stepchildren have now enquired via solicitors whether widow would be open to clean break offer via equity release. They have not stated the amount they wish to have , but want paying "their share" of the house up front via an equity release loan and the widow is left to handle the ever-increasing debt of the equity loan.

Stepchildren now are demanding huge amounts of information from widow and have made accusations that she's had another large amount from their father in the past (£40K, which she absolutely has not) and are demanding years and years of financial information from widow of her personal accounts presumably so they can ascertain what kind of claim she has via 1975 act.

Is it normal or even reasonable for one party to make such demands on the other prior to a potential action? They seem to want to play the legal game with a marked deck. Is it legally required for the widow to provide her personal account information in this way?
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Re: Common practice in negotiations between parties in a wil

Postby atticus » Thu Aug 18, 2016 9:19 am

I have not read all that, but is the widow aware that claims under the 1975 Act must be brought within 6 months after the date of the Grant of Probate?
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Re: Common practice in negotiations between parties in a wil

Postby frobisher » Thu Aug 18, 2016 9:35 am

If you had "read all that" you'd have seen that probate has not yet been granted ;-)
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Re: Common practice in negotiations between parties in a wil

Postby atticus » Thu Aug 18, 2016 12:47 pm

OK. You referred to an executor having been removed by court action. That happens after Probate has been granted. A misunderstanding of terminology, I expect.

The Inheritance (Provision for Family and Dependants) Act 1975 enables the Court to adjust a will which has made inadequate provision for a dependant of the deceased.

In the case of a spouse (or civil partner) this

means such financial provision as it would be reasonable in all the circumstances of the case for a husband or wife to receive, whether or not that provision is required for his or her maintenance
(section 1(2).

all the circumstances of the case include the means and financial resources of the spouse, so that is a proper line of enquiry.

Further, the Courts expect parties to exchange sufficient information before a case is started to enable each to understand the other's case. This is from paragraph 3 of the Practice Direction on pre-action conduct:


3. Before commencing proceedings, the court will expect the parties to have exchanged sufficient information to—

(a) understand each other’s position;

(b) make decisions about how to proceed;

(c) try to settle the issues without proceedings;

(d) consider a form of Alternative Dispute Resolution (ADR) to assist with settlement;

(e) support the efficient management of those proceedings; and

(f) reduce the costs of resolving the dispute.


Those involved should take legal advice, and they should bear in mind that while hitting each other over the head with solicitors' letters and worse may be great fun, ultimately they will all lose. litigation is an expensive pastime.
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Re: Common practice in negotiations between parties in a wil

Postby frobisher » Thu Aug 18, 2016 1:29 pm

Thanks for the input. However I can assure you probate is yet to be granted. Executors can be removed at any time and the widow was in this case. The remaining two executors are now moving towards getting probate (finally) sorted.

The widow has made several attempts to get the stepchildren to mediate. She's also made several offers to settle on various terms. All have been ignored/rebuffed thus far. They seem hell bent on pursuing the current action (which seems to basically now just be disputing the account of monies spent by the widow from the estate).

The real point, I suppose, is whether it's reasonable for the stepchildren to be demanding detailed financial records including personal accounts going back many years. Does the widow have to provide these? They are convinced that at some point in the past, their father paid out £40K to the widow which she has now squirrelled away somewhere. They appear to be demanding her statements to see if she's had it and if so, what she's done with it. Her response thus far has been that they peruse their late fathers bank statements in order to establish that no money has ever been paid to her. She also feels that even if he had given her £40K at some point years ago, it's nothing to do with the estate. I imagine their argument would be that it should form part of the "reasonable provision" she has already had.
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Re: Common practice in negotiations between parties in a wil

Postby atticus » Fri Aug 19, 2016 4:31 pm

Isn't the point that the Widow wants to make a claim; if it is contested points will be made that she will have to deal with. So why not deal with them now?

Note the Practice Direction on pre-action conduct, from which I have already quoted.

I have the impression lawyers may already be involved. If so, they know a lot more about the case than can be posted here, and are well-placed to advise.
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Re: Common practice in negotiations between parties in a wil

Postby dls » Wed Aug 24, 2016 2:18 pm

In theory, a will appointing an executor allows appoints the executor immediately, and the executor _can_ act, but subject to later ratification by the court confirming the appointment as executor. That has not happened here and therefore the actions taken do require justification. It is treated as 'intermeddling' and are for her entirely to justify by the provision of accounting records, as a start.

Expenditure on a house within the estate to make it livable might very easily be improper and repayable - irrespective of what good intentions she had.

Of course we really do not know the details. It may be otherwise. It is time to take and act upon proper and direct advice.
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Re: Common practice in negotiations between parties in a wil

Postby Hairyloon » Wed Aug 24, 2016 2:34 pm

dls wrote:Expenditure on a house within the estate to make it livable might very easily be improper and repayable - irrespective of what good intentions she had...

If the work was booked by the deceased then isn't the contract with the deceased and therefore the liability to pay?
Or does a contract expire along with the contracting party? That might not be fair on (eg) a builder who had bought materials in readiness for the job.
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Re: Common practice in negotiations between parties in a wil

Postby dls » Wed Aug 24, 2016 3:04 pm

What you say indicates just how these matters frequently do carry complications.

Obligations under such a contract may indeed persist against the estate, but equally it would be for her to establish this. That will often carry additional difficulties in an executory construction contract. The executors on the receipt of the grant are entitled to demand and be given a chapter and verse justification. She is _only_ entitled to spend such money if she at some point later is granted probate. If she is not later granted probate, then she did wrong. The starting point is that she owes the money. She took a gamble. She appears to have lost.

What she risks appearing to have done (in law) is to have spent her own money on the house, to have then asked the estate to cough up, and, being temporarily in charge, to have paid herself back when the opportunity arose.
That may be an uncomfortable way of putting it, and it might not be justified, but unless and until she acknowledges that she is starting on a weak back foot she may persist getting it wrong.

The issue of whether the estate owed the money is only a first question. If say, I had paid the bill, why should not the estate say thank you, but without any duty to re-imburse me. The second question is whether she had any business paying it. Had the construction work been completed before the death and she had paid a bill existing at his death, that would be a little better.
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