Situations Vacant.... Solicitor versus lay executor
SITUATION VACANT: Administrator, Event Organiser, Accountant, Diplomat, Personal Representative, Salesperson, Distributor, Antique Dealer, Sorter, Caretaker, Chief Mourner, All Round Good Egg. Only those of impeccable standards, morally sound and essentially decent need apply. In return there is no salary, although expenses will be paid upon production of relevant receipts.
Who amongst us can claim to have half of these qualities let alone all of them and yet many of us are called to use all of the above skills when performing the role of executor of a Will. Some even have the dubious honour many times over during the course of their lifetime.
Those who have chosen to make a Will in order to guarantee where their assets will go, have had to choose executors who are bound, by the terms of the Will and the law of the land, to administer the estate of the deceased to the best of their ability. If one does not wish to go to the expense of appointing a solicitor, most will choose a couple of people they know well: often family or friends. Ideally executors possess, as well as the aforementioned qualities, the time, the skills and the wherewithal to deal with the countless problems which can arise and who, most importantly, are happy to take on the responsibility.
Before you rush to appoint lay executors in preference to a solicitor, be aware that the role can be particularly challenging. In contentious and difficult estates, one becomes the bearer of bad news, walking the tricky tightrope between opposing beneficiaries. Without the luxury of impartiality a lay executor, who is potentially emotionally imbedded, can feel overwrought and overloaded with responsibility. Grieving for the loss of a loved one and making pivotal, irreversible decisions are not happy bed fellows so distance can be helpful. Therefore one of the advantages of appointing a solicitor as an executor is that they should remain untouched by warring factions within families and have the ability to offer unbiased, objective, advice.
Leaving the more practical and personal issues aside covered in Last Orders, widely accepted to act as a tremendous time-saving device for professional and lay executors alike - which may not be music to the ears of solicitors charging an hourly rate, but for percentage chargers it should be a no-brainer - there’s the thorny issue of applying for the Grant of Probate. If you have selected lay executors, you will have provided them with the opportunity to choose how to apply for Probate: DIY or via a solicitor.
It seems there is a rise in the amount of lay executors willing to Do-It-Themselves without referring to the services of a solicitor, apparently saving the estate and the beneficiaries a small fortune... or are they?
Some lay executors fail to dot the i’s of informing the Tax Office and are, therefore, completing the paperwork inaccurately, potentially missing out on tax rebates for the deceased’s estate. Whether this is due to an oversight or just a lack of awareness is unclear but executors can be held liable for those losses to the estate.
Then there is the need for executors to act with some degree of efficiency and promptness, particularly if the estate has shares or a portfolio attached which could plummet during the course of the administration.
Further still, is the situation where lay executors have been seen to undervalue the deceased’s property by, according to HMRC, on average £24,600 and are then held liable for the additional IHT. (http://tinyurl.com/7cwrxs8)
So, for lay executors who are undecided as to whether they have the aptitude or time to deal with the formalities, there are a number of options open:
probate packs can be purchased for the simplest of estates, but given that there is no legal advice offered, nor any action taken to assist, one has to question what is being offered that is not freely available from www.direct.gov.uk.
Then there are the more adventurous law firms anxious to compete with the traditional ones by flexing their muscles, openly advertising Grant of Probate applications; one can engage their services for around £500 plus VAT leaving the lay executor to tidy up the more personal side of the deceased’s estate.
Should you wish to go further still, the same law firms will distribute the estate as per the Will, for a mere one percent plus VAT. Compare that to some firms charging three percent or banks up to eight percent and it all starts to look attractive. The transparency by which such fees are explained establishes and reassures the boundaries, making the once problematic issue of Probate for the lay executor inexpensive and simple.
Finally, the option is there to go to a law firm of the executors’ choiceA fee must always be established and should reflect the complexity and difficulty involved
The choosing of one’s executors is crucial; its importance hugely underrated. There are undoubted and distinct advantages for choosing a solicitor to act as an executor, leaving the lay executor to tidy up the deceased’s more practical, personal and intimate issues that will need to be addressed. All law firms should identify their fees but not all deem it appropriate to fix their fees and advertise that fact so it leaves initially the testators, and then their lay executors, in the tricky position of having to balance options.
With so many options coming onto the market because of changes to the way legal services can be owned and managed, it leaves those firms not willing to be innovative in their approach to costs trailing behind.
Copyright Patricia C Byron 2013