[Administration] Flashcards

Question

How can someone become a PR?

Answer 1

Executor → appointed by will (authority from will; grant confirms). Administrator → appointed under Non Contentious Probate Rules 1987 (authority from grant). + also administrator where have will but no one willing / able to act as executor.

Answer 2

The PRs, by virtue of their appointment.

Answer 3

❌ No, but the roles overlap.

Answer 4

1) Will expressly appoints them as trustee. 2) Intestacy → PRs hold estate “on trust with power to sell” (s.33 AEA). 3) Statutory trust for minors (s.46 AEA).

Answer 5

✅ Yes. Statute provides so. (various trustee acts)

Answer 6

1) Advising PRs – helping with administration process. 2) Acting as executor – appointed by will. 3) Contentious probate – acting for PRs or beneficiaries in disputes.

Answer 7

The PRs (not beneficiaries). Legal fees can however be paid out of the deceased's estate (as administration expenses.)

Answer 8

Becomes professional PR, owes duties to creditors & beneficiaries. Can charge fees for work (would be from estate.) Useful for complex estates or family disputes.

Answer 9

Dispute over will validity. Inheritance (Provision for Family and Dependants) Act 1975 claim. Could be representing PRs or beneficiaries, etc.

Answer 10

The PR is personally liable for any loss caused.

Answer 11

To dispose of the deceased’s body (Williams v Williams). ## Footnote Usually done by family - and this is usually before a solicitor ever gets involved

Answer 12

To provide information to HMRC and pay inheritance tax

Answer 13

No, they may use estate funds within their control.

Answer 14

1. Collect and get in the estate. 2. Administer it according to law. 3. Provide an inventory and account of assets. These duties are owed to beneficiaries and creditors !!

Answer 15

* Identify and locate assets and debts owed to the deceased. * Identify liabilities and creditors. * Obtain control or legal ownership of assets.

Answer 16

* Secure assets * Pay debts and liabilities * Pay administration expenses * Pay legacies * Distribute residue to entitled persons ## Footnote NB: Duty does NOT apply to assets that fall out with succesison estate (eg joint property)

Answer 17

* A list of assets and values (inventory) * Steps taken during administration (account)

Answer 18

Beneficiaries or creditors.

Answer 19

The court can order them to produce an inventory and account (under NCPR).

Answer 20

They must act with **due diligence** and within a **reasonable time**.

Answer 21

12 months from the date of death — the expected period for completing administration. ## Footnote (Although nicknamed executor's year, also applies to administrators)

Answer 22

PRs must justify the delay but it is not automatically a breach.

Answer 23

No — it is for life. PRs must deal with newly discovered assets or unknown beneficiaries later.

Answer 24

A statutory duty of care: * The same statutory duty of care as trustees when exercising powers under the Act: this is a higher standard - such care and skill as is reasonable in circumstances * Applies when PRs (i) invest estate assets, (ii) delegate functions, (iii) insure estate property, or (iv) purchase **land**. ## Footnote NB: professional PRs, and those with special knowledge or expertise (or those who hold themselves out as such) are held to a **higher standard**

Answer 25

Because their role is fiduciary in nature.

Answer 26

1. No **conflict** – cannot act where interests conflict (e.g., buying estate assets EVEN if fair market value paid, although exception here if gets court or beneficiaries' authorisation). 2. No **profit** – cannot profit from their role unless authorised.

Answer 27

If acting in a professional capacity or if payment is authorised by the will.

Answer 28

`Core Duties:` * Keep inventory and accounts (record assets, liabilities, and administration steps) * Act with due diligence and complete administration within a reasonable time (the executor’s year) `Fiduciary duties:` * No conflict — avoid personal interest conflicts * No profit — cannot profit from role unless authorised or acting professionally `Statutory duty of care (TA 2000):` * Applies when investing, delegating, insuring, or dealing with land → Higher standard of care, especially for professionals or those with special expertise `Administrative Tasks:` * Report to HMRC and pay Inheritance Tax (IHT) * Collect in and administer the estate: (secure and realise assets; pay debts, liabilities, and legacies; distribute residue to beneficiaries)

Answer 29

By default, except where they conflict with express powers in the will -- then those express powers would take priority (they can amend / exclude statutory powers.)

Answer 30

The act is ultra vires and amounts to a breach of duty.

Answer 31

To pay debts and/or loans taken to meet inheritance tax.

Answer 32

Sell, charge, or lease estate assets.

Answer 33

Transferring specific estate assets to a beneficiary to satisfy their entitlement. To do this, will need: 1. Requires consent of the recipient beneficiary (unless the will removes this requirement). 2. Also cannot prejudice another beneficiary (eg where an asset was specifically gifted.) ## Footnote NB: also PR cannot appropriate an asset worth more than an entitlement (but may sell it to the beneficiary instead.) NOTE - if have minor asking for change -- can do so with consent of the guardian / parent (says yes to receipt on their behalf.)

Answer 34

At the **date of appropriation**, not the date of death.

Answer 35

Yes — but they must avoid breaching the **self-dealing rule** (which says that a fiduciary must not use their position to benefit personally - such as buying or taking estate assets unfairly.) However have following exceptions (when won't be breaching this rule): * For cash or quoted shares (assets with clear market value) - ok because here relatively objective what entitled to. (no fear that giving themselves more.) NOTE - However, not permitted for unquoted shares and non-cash assets (fear that would not value it correctly for example) -- would therefore require court authorisation or consent from all beneficiaries !! ## Footnote NB ! Exception under intestacy rules for spouse and family home

Answer 36

If the deceased died intestate, they may appropriate the family home to themselves (if **not** sole administrator !!).

Answer 37

PRs have power to insure estate assets for full value and pay premiums from income or capital.

Answer 38

PRs have a duty to preserve and, where appropriate, actively invest estate assets to maintain or enhance their value — **particularly where administration is likely to take some time**. PRs must exercise the general power of investment; * Have regard to the standard investment criteria (suitability and diversification); * Should review investments regularly (typically annually); and * Must obtain proper advice unless it’s unnecessary or inappropriate. Failing to invest prudently (e.g. leaving large sums earning negligible interest) may amount to a **breach of duty**. ## Footnote Example: A testator dies leaving an estate of £3 million, including £1 million cash in a current account earning minimal interest. As administration will take time, the PRs must invest that cash (e.g. in a short-term deposit or low-risk investment) to achieve a better rate of return. Simply retaining the cash in the current account would breach their duty to invest.

Answer 39

Professional PRs (e.g. solicitors), if **not acting alone** and with **written consent of co-PRs**, and has to be **reasonable**. NOTE - a professional PR acting alone (or a lay PR) would need an express clause in a will to allow them to chrge for their services. | Also remuneration NOT treated as gift ## Footnote (Lay PRs CANNOT charge for services unless will permits it.)

Answer 40

Yes — for **properly incurred expenses** (e.g. travel), but not for their time.

Answer 41

Yes, *except* for: * Decisions on distribution * Allocation of expenses between income/capital * Appointment of trustees/nominees/custodians ## Footnote NB: also CANNOT appoint a beneficiary as an agent (but can appoint another PR.)

Answer 42

* A written instruction and * A written policy statement that agent must agree to comply with ## Footnote (Also use of agent and terms of policy need to be kept under review)

Answer 43

Because minors cannot give valid receipt for a legacy. ## Footnote (Can also hold the assets themselves on trust for the minor.)

Answer 44

The minor’s parent or guardian. ## Footnote So here giving the legacy to the trustees instead of retaining it themselves

Answer 45

Yes - statute says so. However for sake of clarity, it's often added in any was as express clause in will. (Or expressly excluded if testator does not want this to be the case.)

Answer 46

Yes — such an express clause is valid. ## Footnote SO express clause can say that 16 year old can give valid receipt, would be valid. However normal rule is that minor cannot. And cannot write a clause saying an under 16 year can accept receipt - this would be ineffective.

Answer 47

Only to sell it as a going concern within one year of death (limited common law power). So can only run it more extensively if the will contains an express power allowing them to do so. Would be however personally liabile for business debts incurred during the running of the business - although they could indemnify themselves from the estate. ## Footnote (so this is pretty limited)

Answer 48

Are required to (like trustees) make decisions together, and should exercise discretionary powers **unanimously**. However, when exercising power to sell or transfer an estate asset during administration, a jointly appointed PR will usually have power to act alone. ## Footnote EXCEPTION: A sole PR **cannot** deal with jointly registered stocks or shares.

Answer 49

Because a PR is personally liable for losses that arise from a breach of duty the commit. May ALSO be liable for breaches committed by other PRs if they did not make reasonable effort to monitor the co-PRs' conduct.

Answer 50

Claim of action against PR for breach of duty = **devastavit** * Can be brought against PR where loss to estate because of PR wrongdoing (C will seek court order for PR to make good the loss using their own personal assets) * NOTE: since PR's duty is a fiduciary one, even if there is no loss to estate, but there is a breach - C can seek account of unauthorised profit and/or for transaction to be set aside.

Answer 51

* **maladministration** (eg: incorrectedly administering the estate to wrong B; using residuary estate to meet liabilities that should have been paid out of other parts; paying legacies before debts without retaining sufficient funds for creditors) * **misuse of assets** (eg: making personal use of estate assets) * **negligence** (eg: unreasonable delay, failing to invest/ making poor investment decisions below standard of care) * **breach of fiduciary duty** (eg: breach of no-conflict rule, no-profit rule, self-dealing)

Answer 52

A PR who fails to carry out their duties may be removed from role by: * court order (which would also appoint replacement PR) or, * administration action (where court would take over administration istelf):

Answer 53

* seeking court orders * s 48 AJA 1985 application * s. 27 Trustee Act 1925 notice * Benjamin order * Presumption of Death Act * Insurance * Payments into court * Indemnity from beneficiary * s 61 Trustee Act 1925

Answer 54

If PRs face uncertainty or risk of personal liability (e.g. due to an ambiguous will or doubt over beneficiaries), they may apply to court for: * **Administration proceedings** – having the court administer the estate; or * **Specific relief** – guidance on a particular question. This ensures PRs act correctly and protects them from liability for following the court’s directions.

Answer 55

Instead of full court proceedings, PRs can apply under s.48 AJA 1985 to distribute the estate in reliance on a **written legal opinion**, provided: * The opinion comes from a qualified person (as per the Act), and * There is no dispute making court involvement necessary. This offers a **faster and cheaper** alternative to seeking full court directions.

Answer 56

PRs can publish a **notice of intention** to distribute the estate, protecting them from claims by **unknown** beneficiaries and creditors who fail to respond within two months. Requirements: * Publish in the London Gazette, * A local newspaper where the deceased owned land, and * Any other appropriate publication (e.g. trade paper). This does not protect PRs against claims by known but missing beneficiaries, nor does it protect overpaid beneficiaries. ## Footnote (So if PR is also beneficiary - only protects them in capacity of PR, NOT in capacity as beneficiary : unknown B who comes to light could claim against them if overpaid.)

Answer 57

Allows PRs to distribute an estate on the **assumption** that a known but missing beneficiary has died (or another similar assumption, e.g. had no children). It protects PRs from personal liability if that assumption later proves false — provided they made **reasonable enquiries** beforehand (Re Benjamin [1902]). However, disappointed claimants can still pursue recipients of the property.

Answer 58

PRs can apply for a court declaration of death for someone missing for at least 7 years (or believed dead). This legally confirms the person’s death and date of death, enabling PRs to deal with their estate safely. ## Footnote (Often quicker and easier than obtaining a Benjamin Order.)

Answer 59

* **Insurance**: PRs can take out a policy covering claims from missing or later-appearing beneficiaries/creditors. It transfers financial risk but may be costly or unavailable for high-risk cases. * **Indemnity**: PRs can obtain a promise of reimbursement from known beneficiaries for losses if claims arise later. However, it depends on the solvency and traceability of those beneficiaries, so it’s not always reliable.

Answer 60

* If there is a dispute or a beneficiary refuses to accept their inheritance, PRs can pay the sum into court and distribute the rest of the estate. * This shifts liability to the court for that portion. * Useful where a beneficiary is known but uncooperative (less so for missing persons, where insurance or a Benjamin Order is better).

Answer 61

Exoneration by court. The court may excuse PRs from personal liability for breach of trust if it finds they: * Acted honestly and reasonably, and * Ought fairly to be excused for the breach and for not seeking court directions. This applies to PRs as it does to trustees. It offers discretionary post-breach relief, not advance protection.

Answer 62

A testator may include exemption clauses limiting PR liability — e.g., excusing them for all acts except fraud or dishonesty, or excluding the statutory duty of care under s.1 TA 2000. Example clause: *“None of my Executors (other than a professional executor) shall be liable for any act or omission save for willful fraud or dishonesty, and the duty of care in s.1 Trustee Act 2000 shall not apply.”* Such clauses can distinguish between lay and professional executors. ## Footnote NB: cannot exclude liability for **fraud** !!! (even if testator says exonerated for all acts.)

Answer 63

Deceased’s identity and date of death Existence of valid will (if any) Executors appointed Value of the succession estate (Also sealed with official signature, stamp & holographic seal.)

Answer 64

Deceased left valid will Executors appointed At least one executor is able/willing to act

Answer 65

The executors who apply.

Answer 66

The grant reflects those limits.

Answer 67

❌ No — but may appoint another under power of attorney.

Answer 68

Deceased left a valid will, But no executors are willing/able to act. [Administrators appointed under Rule 20 NCPR 1987 (priority list applies).]

Answer 69

When deceased died intestate (no valid will, revoked, or invalid). [Administrators appointed under Rule 22 NCPR 1987 (priority list).]

Answer 70

Grant of Probate → valid will + executor(s) acting. Grant of Letters of Administration (with will) → valid will, no executor acting (Rule 20 NCPR). Grant of Letters of Administration → intestacy, no valid will (Rule 22 NCPR).

Answer 71

Usually yes — but not for: - Assets outside succession estate - Some low-value assets within it, which include (i) assets under small payments act 1965, (ii) personal possessions (chattels), and (iii) cash in home

Answer 72

Payments to rightful persons without formal proof of title. Limit: **£5,000 per asset** — above that, grant required. Assets qualifying: - National Savings (banks, certs, premium bonds) - Friendly Society / Industrial Society deposits - Arrears of pay or pension (police, fire, armed forces) - Building society accounts ## Footnote NOTE tho - Act PERMITS payment, but doesn't compel it !! So institutions are not forced to pay here.

Answer 73

Often release up to £15,000 (or more) without a grant. Require death certificate + will/intestacy proof + PR indemnity. Example: - Building Society £60k → Grant needed - Premium Bonds £2k → No grant (under Act) - Current Account £10k → Bank may release via policy

Answer 74

✅ Yes — title passes by delivery. Exceptions: -- Cars (need registration docs) -- Jointly owned items → co-owner must consent -- Specific gifts in will → check before sale

Answer 75

✅ PR can take possession without grant.

Answer 76

i) Joint property (via survivorship) ii) Donationes mortis causa (gifts on death) iii) Life policies in trust / nominated pensions iv) Trust assets – dealt with by trustees Evidence required for release of these: - Death certificate + asset holder’s required docs.

Answer 77

Provide early funds for expenses / IHT Help beneficiaries sooner Useful for small estates — cost-effective

Answer 78

✅ Obtain the grant — simplifies full administration.

Answer 79

Usually the family; PRs need copies to send to banks, insurers, HMRC, etc. ## Footnote (Note - this must occur before the funeral can take place.)

Answer 80

Paid from estate funds (post-death admin expense - deductible for IHT)

Answer 81

Secure property, notify insurers if vacant, safeguard valuables, handle digital assets and social media.

Answer 82

Only the original (not a copy) can be used to obtain a grant. If cannot find it : determine if revoked or lost — may need to reconstruct; check national wills register if needed.

Answer 83

Ensure valid execution, correct witnessing, no missing clauses, and that any codicils make sense with the will.

Answer 84

Only executors before; becomes public after the grant.

Answer 85

Who benefits and a realistic timeframe — months, not weeks. (so can have realistic expectations)

Answer 86

To identify, value, and manage assets/liabilities, calculate IHT, and establish entitlement. Family info, bank statements, insurance docs, financial institutions can help with all this.

Answer 87

Bank accounts: Ask for date-of-death balance + interest. Joint accounts: Confirm ownership share (not always 50/50). Chattels: Estimate what would fetch if sold - this is lower than insurance value (what would cost to replace); get probate valuation for items > £500. Quoted shares: Use stock exchange formula (lower + ¼ diff). Land: Get estate agent valuations from different people (average used).

Answer 88

These debts cannot reduce IHT: -- the deceased had borrowed money to finance the purchase of an IHT excluded asset. -- a debt owed by the deceased is never actually repaid from the estate funds.

Answer 89

1) Register death & obtain certificates 2) Arrange funeral 3) Secure assets 4) Locate and verify will/codicils 5) Identify beneficiaries 6) Compile assets & debts 7) Check lifetime transfers

Answer 90

Pre-deceased or died before grant Minor (under 18) – appointment valid, but can’t act until 18 (so can apply once turns 18 if admin still incomplete - so power can be reserved.) Lacks mental capacity Divorced/dissolved spouse or civil partner (treated as pre-deceased under s.18A/C Wills Act 1837, unless will overrides)

Answer 91

Minimum 1, maximum 4 on the grant (though more can be named in the will). If more than 4 - will decide amongst themselves who to be named on the grant.

Answer 92

Remaining executors can proceed, explaining why others aren’t applying (e.g. pre-deceased, renounced).

Answer 93

* Non-applying executors keep the right to apply later if needed — via a grant of double probate. * Don't need to sign a form to reserve (while you do need one to renounce.) Also don't need to give notice to fellow executors. * However, can **only** reserve power if another named executor applies for grant of probate !! ## Footnote Eg: 5 executors named (Anna, Bella, Chris, David, Ellie): only 4 can take the grant; the 5th has power reserved and may apply later if a vacancy arises. Contrast with this Eg: 4 executors named + Ellie as substitute: Ellie only acts if one of the 4 dies or can’t act before the grant; she has no power reserved otherwise.

Answer 94

The remaining PRs continue administration.

Answer 95

Two possibilities: 1) Chain of representation (s.7 AEA 1925) 2) Grant of letters of administration de bonis non

Answer 96

Only applies where a **sole surviving executor**, who has **taken out a grant of probate**, dies before administering the estate and **appoints their own executor** in turn. E2 takes out probate for E1’s estate. → E2 automatically becomes executor of both estates (no new grant needed for first estate). **DOES NOT** apply to administrators (whether at first stage OR second stage of above.) ## Footnote SO NOTE -- only where have sole executor, and had already taken out the grant of probate .... SO if executor has predeceased -- cannot have chain of representation !! (because need that grant of probate to already have been taken out...) * TRICK to remember: remember chain is that don't have to take out new grant, so ofc need a grant already taken out !!

Answer 97

Administration incomplete No surviving PR There has been a previous grant [Used when chain of representation cannot operate (e.g. no executor appointed by the deceased PR).] | (the “de bonis non” bit = of the goods not yet administered)

Answer 98

When the deceased left a valid will but there are no executors willing/able to act. Governed by Rule 20 NCPR

Answer 99

It broadly follows the entitlement to the estate assets under the will: (a) Executor (b) Trustee of the residuary estate (c) Residuary beneficiary (absolute or for life) / beneficiary under intestacy (if partial intestacy) (d) PRs of anyone in (c) (except trustees/life tenants) (e) Any other beneficiary or creditor (f) PRs of anyone in (e). (correlates to distribution under will, and NOT familial relationship) ## Footnote NOTE - when taking out grant under this rule, need to 1. Say what category you are above 2. Clear off anyone in higher category than you 3. State whether there is a minor or life interest (both cases would need two administrators to act !)

Answer 100

Explaining why anyone with a better right to apply is not doing so. This needs to happen if people in category above you aren't taking out the grant (and you are.) Don't need to clear off someone in the same category as you - so only needed for those with a better right, NOT equal entitlement.

Answer 101

When the deceased died intestate (no valid will). Governed by Rule 22 NCPR

Answer 102

The entitlement to the estate under intestacy. (a) Surviving spouse/civil partner (b) Children (c) Parents (d) Whole-blood siblings (e) Half-blood siblings (f) Grandparents (g) Uncles/aunts of whole blood (h) Uncles/aunts of half blood. Issue of (b), (d), (e), (g), and (h) take their parent’s place if pre-deceased. PLUS NOTE that you will need a beneficial entitlement to estate to apply !! (or would have if estate was bigger.) ## Footnote Basically same as intestacy !! just add in surviving spouse and children at top (as is actually the case anyway lol.) ALSO NOTE - to take out grant would need to have entitlement (or be entitled if estate was bigger.)

Answer 103

The Crown (bona vacantia). If not, a creditor OR someone who would have benefited if the estate were larger (22(3)). ## Footnote (If would never have benefited - cannot !)

Answer 104

1. Lower categories cannot apply before higher ones. 2. Equal rights within the same category. 3. Must “clear off” anyone with a better (not equal) right.

Answer 105

* First: state their familial relationship with the deceased and * Second: confirm whether they are entitled to whole or part of estate. * Also would need to clear off anyone in above category if they aren't applying (+ BTW the PR of someone entitled who survived the deceased but died before taking a grant may apply on their behalf.)

Answer 106

No one until 28 days pass, as spouse not yet beneficially entitled.

Answer 107

Yes, because they would have benefited if the estate were larger. ## Footnote NB: not always case that would benefit if estate was larger: if no spouse / kids, deceased's mother would have right to apply. If chose not to, deceased's brother would still have no right to apply because even if estate was larger would get nothing !!

Answer 108

No; another person with equal/greater entitlement should apply

Answer 109

No, but someone may apply on their behalf. Although -- Adults with equal entitlement have priority over someone applying on behalf of minor

Answer 110

Only one required usually (max 4 can apply for grant). However, some exceptions when at least 2 administrators are required: * When any part of the estate passes to a minor beneficiary OR * is held on a life-interest trust ## Footnote NB : this does NOT apply to executors !!

Answer 111

That person may apply jointly with someone from the next category

Answer 112

* Pre-deceased the testator or died before grant. * Is a minor (under 18). * Lacks mental capacity. * Is a former spouse/civil partner (divorce/dissolution after will)

Answer 113

* Remaining executor(s) can apply for probate but must explain why others are not. * If a minor: probate issued to others with power reserved to minor (Rule 33 NCPR). * Power may also be reserved to someone lacking capacity

Answer 114

1. Renunciation 2. Reserving power 3. Appointing an attorney

Answer 115

* Formal giving up of the right to apply for probate. * Executor signs a **form of renunciation** submitted to the probate registry. * Noted on the grant. * **Final** — cannot later change mind without court approval. * Not allowed if executor has **intermeddled**.

Answer 116

* Taking active control of estate assets (e.g. selling, paying debts). * Obtaining, receiving, or holding estate assets. * Common law: paying debts, selling/disposal of assets. So really just handling the money and assets !! ❌ Not intermeddling: 'acts of common humanity' such as arranging funeral, securing property. ## Footnote NOTE - even if administrator has intermeddled, they can renounce.

Answer 117

* Executor chooses not to act now, but keeps right to act later. * Must be at least **one other executor** applying for the original grant. * Later, can apply for a grant of double probate (if administration incomplete). * Rule 27 NCPR: executors applying must give notice to the one reserving power. * Reservation and fact notice was given then noted on the grant. ## Footnote So notice is given to the one reserving power that they are going to take the grant out, not by them !! (and no form needed here.) ALSO : intermeddling is fine for reserving power (lots of people do it for different reasons, like might be leaving jurisdiction for 12 months.)

Answer 118

* **After** grant: may delegate PR functions under s.25 Trustee Act 1925 (max 12 months, renewable). * **Before** grant: attorney cannot apply for probate (not named in will) → applies instead for letters of administration (with will) alongside other executors. Power of attorney must be lodged with probate registry

Answer 119

* Pre-deceased or died before grant. * Minor (unless application made on their behalf). * Lacks capacity. * Has **no beneficial entitlement** (NCPR 22 only).

Answer 120

* Renunciation * Appointing an attorney *(They **cannot reserve power**.)*

Answer 121

* Can renounce at any time before grant. * Unlike executors, can renounce even if intermeddled. * Must sign renunciation form → lodged with probate registry. * Final decision — no option to reserve power. ## Footnote Contrast with executor here !!

Answer 122

An executor who renounces probate does not automatically renounce right to apply as administrator under NCPR 20/22 → may need to renounce both.

Answer 123

(Meaning here stuck in limbo a bit.) Can have court use citation process to: * Compel them to take out a grant, * Remove their right to act, or * Authorise another to act. ## Footnote *(outside scope of this module) *

Answer 124

* **Executor** → can renounce, reserve power, or appoint attorney. * **Administrator** → can renounce (even if intermeddled) or appoint attorney (no reservation). * Minor / person lacking capacity → cannot act. * If no PRs willing/able → issue letters of administration (with will) under NCPR 20. * Citations may force or replace an unwilling PR.

Answer 125

* Online via HMCTS service. * Paper (by post) using PA1A (where administrator) or PA1P (where executor). ## Footnote Trick: A for Administrator

Answer 126

1. Mandatory online – e.g. most grants of probate. 2. Optional online – simple NCPR 20/22 applications. 3. Mandatory paper – complex/non-standard cases

Answer 127

* Second (double) grant (e.g. executor with reserved power). * Missing/defective will. * Grant to attorneys. * Life interest arises (NCPR 20). * Chain of representation applies.

Answer 128

* Identity of deceased & applicants. * Justification for the type of grant. * Entitlement to act as PR. * Estate value & IHT status. * Legal statement (promise to administer correctly).

Answer 129

List all (e.g. “Margaret Alice Smith also known as Meg Smythe”).

Answer 130

Produce the original will and any codicils (proving the will).

Answer 131

Land under a trust governed by the Settled Land Act 1925 (no longer newly created). Need to indicate this on application, and a separate grant is needed to deal with the legal estate.

Answer 132

A signed confirmation by all applicants that information is true and they’ll administer properly

Answer 133

Depends on the estate, but generally: * Application form (online or PA1A / PA1P) * Probate Registry fee (+ cost per sealed copy) * Other items depending on circumstances

Answer 134

* Fee depends on estate value; no fee if <£5,000 * Sealed copies requested for each asset holder + spares * Certified death certificate needed (not for professional applications)

Answer 135

* Original will + any codicils (even revoked ones if they amended the will) * Form of renunciation if an executor is renouncing (only allowed to renounce remember if they haven’t intermeddled)

Answer 136

* Excepted estates: No IHT, no form needed * Non-excepted estates: IHT400 must be sent to HMRC, confirmation letter with unique code required before grant is issued (NB here form not sent to probate registry, just HMRC)

Answer 137

If an executor/beneficiary appoints an attorney to apply on their behalf * Submit attorney details + declaration explaining why executor isn’t applying * PA11 (power of attorney form) submitted with application - so paper appl. mandatory here ! ## Footnote NB: does not need to be sent if power of attorney given *after* grant of probate taken out - so only need to send it when grant will be taken out in attorney's name

Answer 138

Needed for all applications: * Online application or PA1A / PA1P * Application fee + sealed copy fees Needed for some applications: * Certified death certificate (if non-professional applicant) * Original will / codicil (if will) * Form of renunciation (if renunciates) * Affidavit evidence (if something makes will uncertain) * Power of attorney (if power of attorney)

Answer 139

* Formal written statement of fact signed under oath * Deponent “swears” or “affirms” truth of contents * Jurat required: signed by deponent + witnessed by solicitor/commissioner for oaths, dated, and immediate to text

Answer 140

Original will exists but validity or interpretation is uncertain Concerns with: * s.9 Wills Act 1837 compliance * Knowledge & approval of testator * Date of will * Physical condition of the will Alternative: from Nov 2020, witness statement + Statement of Truth may be used ## Footnote oof

Answer 141

Confirms will executed according to s.9 Wills Act 1837 * Used if signatures oddly placed, attestation clause missing, or doubts about knowledge & approval

Answer 142

Confirms correct date of will if missing, incomplete, or multiple dates

Answer 143

Where seem to have alterations to the will (such as clauses scratched out.) An affidavit therefore confirms timing of amendments to the will (before vs after execution) -- because if after : ineffective, if before execution: effective alteration.

Answer 144

Confirms physical condition of will at execution and after death * Eg issues: torn, pin holes, missing pages, signs of revocation

Answer 145

Confirms enquiries to locate missing will/codicil * Required if original is lost or destroyed

Answer 146

Home-made wills Wills not supervised by a solicitor Original documents poorly executed or stored So can be avoided by: * Proper drafting, execution, and storage of will * Let testator know importance of avoiding alterations or marks * Supervision by solicitor

Answer 147

Confirms testator understood contents Needed if testator was blind, illiterate, or extremely frail Usually made by a witness, confirms will was read aloud

Answer 148

Normally, an affidavit of due execution could confirm the date of a will. Problem: Both witnesses are dead → no suitable deponent exists. Result: Affidavit cannot be sworn; probate application cannot rely on it. Key point: Affidavits require a **living deponent** who can swear to the facts.

Answer 149

* Since have to pay it before get grant, means we don't have access to assets. * Can however request bank to pay directly to HMRC - IHT 423. In return get unique code of reference stating that you paid IHT that you stick into the grant application. * if don't have liquidity however, can borrow from bank. Disadvantage - have to pay interest at commercial rate. * or can get grant on credit from HMRC - tell you pay as much as you, if have shortfall, we will will give you grant on credit, but as soon as you can pay up rest. ## Footnote PLUS - check if there is an option for borrowing from residuary beneficiaries at below market rate of interest (it was in an MCQ in W10... although wrong answer, prof seemed to say was still an option, although not best advice here.)

Answer 150

The method depends on the asset type: * Bank accounts: banks/building societies require withdrawal forms. * Investments: sold or transferred by a financial adviser. * Personal possessions: physically collected and secured. * Land: transferred into PRs’ names (if not directly to a beneficiary). All funds should be paid into a PR’s estate account or law firm client account (interest must be fair and reasonable under Solicitors’ Accounts Rules). The key aim is to avoid mixing estate money with personal funds and ensure transparency.

Answer 151

PRs must pay debts and funeral expenses as soon as practicable, exercising due diligence (normally within the “executor’s year”). * Failure to do so when funds are available exposes them to personal liability both to creditors and beneficiaries. * While a will can limit liability to beneficiaries, it cannot protect PRs from creditors. * To guard against unknown creditors, PRs can publish a s.27 Trustee Act 1925 notice (in Gazette, newspaper local to their area, and any other relevant newspaper like a trade one for eg), which protects them personally if new creditors later appear.

Answer 152

* Beyond debts, PRs pay expenses from the estate — including probate fees, valuation costs, s.27 notices, professional fees, and repayment of any pre-grant IHT loans. * If they gave a “first proceeds” undertaking to a bank (promising to repay IHT loans with the first cash raised), failing to do so is a breach. * PRs should therefore settle such loans early to avoid unnecessary interest and potential breach of undertaking.

Answer 153

Under s.32 AEA 1925, all property of the deceased can be used to pay debts and liabilities — any contrary will clause is void. However, the order in which assets are used depends on: * Whether the estate is solvent or insolvent, and * Whether debts are secured or unsecured. This order matters for fairness between beneficiaries.

Answer 154

* A solvent estate has enough to pay all debts, expenses, and liabilities — even if some legacies cannot be paid in full. * An insolvent estate cannot meet all liabilities; debts must then be paid according to the Administration of Insolvent Estates of Deceased Persons Order 1986 (similar to bankruptcy rules).

Answer 155

Under AEA 1925, property subject to a charge (like a mortgage) bears the primary liability for that debt unless the will clearly says otherwise. * Example: If A leaves their mortgaged house “Chez Nous” to B, and the will doesn’t say the estate should pay off the mortgage, B inherits it subject to the £30,000 mortgage. Only if the debt exceeds the property value does any shortfall become an unsecured debt.

Answer 156

For solvent estates, AEA 1925 sets out the statutory order for unsecured debts (this is because although order is not primary concern for creditors, will be for beneficiaries because could abate their share !!) Unless the will shows a contrary intention, assets are applied as follows: 1. Property not disposed of by the will (intestacy property whether full or partial) 2. Residue (after retaining funds for pecuniary legacies) 3. Property set aside or charged with specific debts 4. Pecuniary legacy fund (legacies reduced proportionally if shortfall) 5. Specific gifts (e.g. jewellery, cars) ## Footnote This order ensures fairness — unsecured creditors are paid, but beneficiaries’ gifts abate proportionately only when necessary. NOTE : (if plenty of money – **doesn’t matter** !! only where going to impact beneficiaries’ legacies, also if have solvent estate NEVER MATTERS what order CREDITORS get paid in !!)

Answer 157

* Abatement occurs when pecuniary legacies are reduced because the estate cannot cover all debts. * For instance, if B and C each get £10,000 but only £15,000 remains, their legacies abate proportionately — both receive £7,500. * If their gifts are unequal, the reduction mirrors the value ratio of their gifts (e.g., ¾ and ¼).

Answer 158

A will can show a contrary intention — an explicit direction altering how debts are paid. * For **unsecured** debts, a general clause like “I direct my debts be paid from my residuary estate” is sufficient. * For **secured** debts, the intention must be specific — e.g., expressly stating that the beneficiary takes the property free of the mortgage. However, here, a general “pay debts from residue” clause does not override s.35 AEA.

Answer 159

If PRs use assets “out of order” to pay creditors (e.g., taking funds from a beneficiary’s share when others should’ve been used first), that beneficiary can invoke marshalling: * They can recover their loss from the property that should have been used. * Creditors aren’t affected — marshalling operates only between beneficiaries to restore fairness.

Answer 160

PRs have a general power of sale but must respect the statutory order and any contrary intention. When they have discretion, they consider: * CGT impact (avoid selling appreciated assets) * Ease of sale (shares easier than land or businesses) * Beneficiaries’ wishes (especially if they hope to keep a particular asset). The guiding aim is to preserve estate value while respecting equitable distribution.

Answer 161

PRs inherit assets at their probate value. If an asset increases in value after death, any sale profit may trigger CGT (beyond the annual exemption). To minimise CGT: * Sell assets that haven’t appreciated, or * Transfer appreciated assets directly to beneficiaries (a non-disposal for CGT purposes). ## Footnote Example: Sell a car that hasn’t risen in value instead of a painting that has (and so directly transfer painting to B instead - which doesn't incur CGT)

Answer 162

* Appropriation lets PRs satisfy a legacy (or residuary entitlement) by transferring an asset instead of its cash value. * Though PRs aren’t bound by beneficiaries’ wishes, they should consider them — for instance, allowing a beneficiary to take an heirloom rather than sell it. * This keeps administration fair and personal while complying with statutory priorities.

Answer 163

They must: * Finalise the deceased’s income tax (IT) and capital gains tax (CGT) up to the date of death. * Pay any IT or CGT arising during the administration period. * Distinguish between the deceased’s income/gains and those generated by the estate itself.

Answer 164

PRs submit a tax return for the period 6 April to the date of death to: * Pay any outstanding IT or CGT the deceased owed, or * Claim any refund due. These liabilities are paid out of estate assets and are deductible for IHT purposes.

Answer 165

Because different tax rules, rates, and allowances apply before and after death. * Deceased: taxed as an individual (full allowances apply). * Estate: taxed as a separate entity (no personal allowance, basic rate).

Answer 166

* Income actually received before death, and * Income due but unpaid before death (e.g. rent due, declared but unpaid dividends). PRs use the deceased’s tax-free allowances and pay tax at their usual rates. * No date apportionment for bank interest (CIR v Hendersons Executors): (so just look at payment date, don't consider when became due.) Interest paid before death → taxed on deceased. Interest paid after death → taxed on PRs. ## Footnote If testator's income (and not estates) then deductible for IHT purposes !!

Answer 167

* PRs check for any disposals made before death → pay CGT using the deceased’s allowances/rates. * Death itself is not a disposal → no CGT arises. * Assets are “re-based” to their market value at death, wiping out lifetime gains (a “tax-free uplift”).

Answer 168

Estate income arises between death and distribution of assets — e.g. bank interest, dividends, or rent. PRs pay IT on this income at **basic** rate, with no personal allowance (unlike individuals): * Interest/rent → 20% * Dividends → 8.75% After distribution, any future income is taxable on the beneficiary. ## Footnote (note £500 de minimis rule tho!)

Answer 169

If total estate income ≤ £500 in a tax year → no need to report or pay any tax. If it exceeds £500 → all the income is taxable (not just the excess).

Answer 170

PRs issue Form R185 (Estate Income) when distributing income to beneficiaries. It shows how much tax PRs paid. Beneficiaries: * Can claim refunds if non-taxpayers, or * Must top up tax if higher/additional rate taxpayers.

Answer 171

* If they sell assets and make post-death gains, those are taxable. * PRs get the same annual CGT allowance as individuals (contrast here with income tax) * If they transfer assets directly to beneficiaries, that’s not a disposal, so no CGT. ## Footnote SO --- get same CGT allowance as individuals, but NOT for income tax...

Answer 172

Asset values are reset (“uplifted”) to their market value at death. → All gains from the deceased’s lifetime are wiped out. → Only gains made after death are taxable (by PRs or beneficiaries). ## Footnote Example: Deceased bought an asset for £50,000; at death it’s worth £80,000; PRs sell for £100,000. What’s taxable? £30,000 lifetime gain → ignored (death not a disposal). £20,000 post-death gain → taxable on PRs.

Answer 173

* **Sale**: PRs make a taxable gain; CGT paid by estate. * **Transfer** to beneficiary: not a disposal → no CGT for PRs. The beneficiary inherits the probate value as their base cost. When they later sell, they pay CGT on the difference between sale price and probate value. Eg: if probate value was 50k, then when was transferred to them was actually 80k, and then they sell it for 100k - the gain will be 50k rather than just 30k

Answer 174

* If PRs have unused CGT allowance → better for them to sell. * If beneficiary has unused allowance → better to transfer and let beneficiary sell. * If sale would create a loss, PRs should check which party can use that loss most effectively.

Answer 175

Gains on the sale of tangible movable assets (e.g. art, jewellery, furniture) are exempt if the sale price is **£6,000 or less** (s.262 TCGA).

Answer 176

Because they need to know the final figures for debts, taxes, and other legacies before calculating what’s left. Residuary distribution is therefore the final step.

Answer 177

They are early part-payments to residuary beneficiaries before the final administration is complete. PRs can make them if they’re confident enough assets remain to cover outstanding liabilities. ## Footnote (Done if B is struggling financially for eg.)

Answer 178

* Chattels: delivery * Money: cheque or bank transfer * Shares: stock transfer form * Land: assent (Land Registry Form AS1)

Answer 179

* Allow 2 months for s.27 Trustee Act notices (claims by unknown creditors). * Wait 10 months from grant for possible IPFDA 1975 claims (6 months to issue + 4 to serve notice). * Complete administration within a “executor’s year” where possible.

Answer 180

Legacies abate (reduce) in reverse order: 1. Residuary — loses out first. 2. General — next to abate. 3. Specific — last to be reduced. Within each category, abatement is proportional. ## Footnote Eg: An estate is valued at £50,000. The deceased’s will leaves a specific gift of an asset worth £10,000 to A, a general cash legacy of £38,000 to B, and the residue to C. The deceased’s debts total £4,000. Who receives what? A receives the specific asset and the creditors are paid in full. B receives £36,000. C receives nothing.

Answer 181

* Specific: Identifiable asset (“my gold ring”) — transferred as is. * General: Not tied to a particular asset (“£1,000” or “100 ICI shares”) — paid out of residue. If the will doesn’t specify which assets to use, general legacies are paid from residue.

Answer 182

To evidence proper distribution and discharge liability. If a minor is entitled: * May accept receipt **if** will authorises 16/17 y.o. to do so. * Otherwise: payment via parent/guardian , trustees, or court.

Answer 183

They record all assets, debts, and distributions. Signed by **PRs and residuary beneficiaries** — signature marks the *end of administration*. ## Footnote (The residuary Bs have to sign it - because this signals they are ok with how administration was conducted, usually releasing PRs from liability.)

Answer 184

1. Capital Account — assets, debts, administration expenses and what’s happened to each. 2. Income Account — income received (rent, interest) and any income tax/expenses. 3. Distribution Account — shows interim and final payments to beneficiaries.

Answer 185

The PRs may appropriate the assets in whatever way they choose, as long as each beneficiary receives assets with a total value of £1,500. (Neither entitled to particular asset.)

[Administration] Flashcards

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