my daughters are beneficiaries of a will and they have receved a Deed of Covenant and Indemnity to sign from an appointed personal representative of the deceased who has been issued with a grant of representation from the probate registry. They have been requested to sign this document to release the cash sums before the 6 month period has expired from the grant of probate. This apparantly protects the personal representative from any successful claims under the Ingheritance Act 1975.Is this normal and what would be my advice to them?Jeremy Sample.
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The basic rule is that the executor or administrator of an estate can become personally liable if they fail to administer the estate properly. The most common reason that this would arise would be if the personal representative distributed the estate and there were creditors that were owed money by the deceased. There is provision in law for a personal representative to place a 'statutory advert' in the London Gazette. If the advert is placed and sufficient time given for creditors to read it and to notify the personal representative of any claims then if they come later they cannot hold the estate liable. I suspect that the form your daughters are being asked to sign indemnifies the personal representative from responsibility in the event that a creditor makes a claim, having regard to the fact that there has been insufficient time left from placing the statutory advert (or no advert has been placed at all).This is not particularly unusual and if your daughters knew the deceased reasonably well and are reasonably confident that there are no creditors then they may think that signing the form to get the money 'early' makes sense.
There are numerous beneficiaries including about 10 charities and a large residual estate going to an Executor. My question is why would the residual estate not be used to protect the personal representative and why would the cash beneficiaries be required to sign the Indemnity?
I had assumed that your daughters were the sole beneficiaries.What exactly does the indemnity form say?Chris_H40646.5370327546
basically it states this:
in consideration of releasing the legacies to the beneficiaries before all possible liabilities of the estate have been quantified within the 6 month statutory limitation period for claims under the Inheritance Act 1975 the beneficiary covenants agree to indemnify the personal representative's estate and effects up to the amount of each cash legacy in the event of the undistributed estate becomes inadequate aghainst any actions, proceedings, claims, demands, costs & expenses the personal trepresentative my be liable to incur under the IPFDA 75 or any other claim.
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Ok that is clear but one final question - why would the Executors and the Administrator assign this responsibility to a Personal Representative and incur additional 3 party costs against the estate - I am just a bit suspicious about what could have become to the residual estate and how do I find out how much this is/was ?
Sorry but I am not quite sure about the terminology you are using there. An Executor is someone appointed to handle the estate affairs in a Will. An Administrator is someone appointed where there is no Will (but is otherwise the same thing as an Executor) and 'Personal Representative' is used to describe either an Executor or a Administrator. In this case there is a Will so there should be an Executor or Executors who are handling matters (they may have appointed Solicitors to act on their behalf).Is it not the case that it is the Executor or their solicitors that are acting in the administration of the Estate?
my understanding is that it was the Administrator who applied for probate and was appointed by the Executors. In this case one Executor receives the residual estate and the other Executor is the family Solicitor. Why I wonder when I requested a copy of the Grant of Probate they would not send it to me and why would they appointed an independent personal representative to distribute the cash legacies when the family Solicitor could have done this quite easily?
Is the person you are describing as the 'Administrator' another solicitor, or a bank or probate company then? Not sure why the family solicitor would not act, but this doesn't necessarily signify anything suspicious.If you want a copy of the Probate then you should be able to obtain it from the Probate Registry.
The family Solicitor originally handled all the deceased accounts and investments. the estate valuation, the sale of the property, contents, furniture and chattles, arranged house clearance and applied for Probate but appointed this personal representative to administer the legacy payments. Incidentally all these legacy payments were covered by the deceased investment and savings accounts and the only unknown quantity were the proceeds from the house and contents sale which represent the residual estate.
I intend to go to the Probate registry tomorrow in Holborn but I would also like a copy of the estate valuation from HMRC which may be a problem.
If you have any suggestions, I would appreciate them otherwise I thank you for your help i this matter.
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