It’s a difficult one Should people who are cohabiting have the right to claim the estates of their loved ones when they die in the same way bereaved spouses or civil partners do? The UK Law Commission says yes. But others say that if the cohabitees had meant their partners to have a share of their wealth they would have either got married or written a will. Dig deeper and the argument becomes one about protecting the “specialness” of marriage.

There is an anomaly here, though. The laws on intestacy – what happens when someone dies without a will – date back to the 1920s, a time when cohabitation was, in the eyes of the middle classes, akin to running a brothel. Fortunately, we live in more liberal times, and while I do think that marriage (and civil partnerships) should be encouraged through the tax system, it’s a strange sort of morality that can watch someone who was clearly precious to the deceased go without – and often suffer huge hardship – all for the supposed greater good. If you’re living with someone, think about who is more important in your life – the person you wake up with each morning or some cousin you may see once in a blue moon? Because under intestacy law, it’s your cousin who has a chance of inheriting while your dearest doesn’t.

What’s more, anyone who has had an unmarried partner dangerously ill or die knows that, from the moment they get involved in anything bureaucratic or healthcare-related, their rights are zilch compared with the blood relatives’. For instance, and I speak from personal experience, even if the stricken individual actually had nothing to do with the family, they get to dictate who visits the bedside; the partner is there on sufferance. Put simply, in our society we don’t properly recognise the “specialness” of committing to live together. Amending the intestacy laws would be a start to correcting this.

For me, the best approach would be to allow live-in partners a portion of the estate under reformed intestacy laws, but at the same time encourage far more people to make a will. Turn the whole argument around; say to people, if you don’t want your live-in partner to inherit then make a will. (Although, if you don’t want them to inherit what are you doing with them?)

Generally, people don’t make a will because they are intimidated by the cost, the legal language and their own mortality. More people would be happier making a will if the industry were visibly regulated rather than having the Law Society governing solicitors and no one overlooking the will-writing firms, some of which employ tactics that even dodgy commission salespeople in the financial-services industry would baulk at. Most of this is solvable with a bit of clear thinking, but if you’re living with someone and don’t have a will, why not take advantage of Will Aid month starting today (see page 91) where you can get a will drawn up for a fraction of the normal cost.

Be Safe and use Certainty to register your will on the UK’s National Will Register.

Pensioners are being urged to draft ‘living wills’ in case they become incapacitated. As The Mail on Sunday reported last week, thousands of families each year have to apply to the Court of Protection if a relative is struck down with dementia or other long-term illnesses.

But families can avoid a distressing and expensive court procedure if they draw up a lasting power of attorney, which allows you to nominate someone to act on your behalf if you can no longer make decisions for yourself.

Caroline Bielanska, chairwoman of trade body Solicitors for the Elderly, says: ‘You have to think of a lasting power of attorney as a way to take control of what could happen to you, and not as losing control of your affairs.’

But more than half of adults have not even discussed the issue with older relatives, says the Equity Release Solicitors’ Association. About 8,000 lasting power of attorneys are registered each month, but this is a fraction of those who could benefit. There are more than 700,000 people with dementia, says the Alzheimer’s Society.

There are two kinds of lasting power of attorney in England and Wales. A Property and Affairs LPA gives someone authority to make decisions about your financial affairs. A Personal Welfare LPA lets someone make decisions about your welfare, though far fewer opt for this.
In Scotland a Continuing Power of Attorney allows someone to act on your behalf in financial matters. A Welfare Power of Attorney allows them to deal with your personal affairs too. The person granting the LPA chooses who will act for them. The attorney is often a spouse, but experts also recommend that you appoint a second person, such as an adult son or daughter.

Peter Barton, partner at Ashfords Solicitors in Tiverton, Devon, says: ‘In some cases, such as selling a jointly owned home, a spouse who is an attorney cannot act alone.’

No LPA can be used until it is registered with the Office of the Public Guardian or the Office of the Public Guardian (Scotland).

Sorting out the financial affairs of her late brother prompted Mavis Haslam and her husband Jack to draft their own powers of attorney. Mavis, from Bolton, Lancashire, says: ‘He died without making a will and coping with that made me determined to leave our affairs in good order.’

Keen golfers Mavis, 68, and Jack, 71, who ran a pharmacy, wanted to get their powers of attorney drawn up while they were in good health and have appointed each other attorneys along with their son, John, 41. Mavis says: ‘It gives us peace of mind.’

It is possible to set up your own power of attorney. Forms can be downloaded from thisismoney.co.uk/living-wills. The fee to register the application is £120 (£65 in Scotland). Those on some benefits are exempt from fees.

But the paperwork is complex and as part of the process a ‘professional’ person must certify you understand the implications and are not acting under coercion, so most applicants pay a solicitor to help them.  Legal fees start from about £175 plus VAT.

Be Safe and use Certainty to register a will on the UK’s National Will Register.

Enticing offers of discount or even free will-writing services may sound harmless enough, but many families who take this route risk paying dearly when it comes to sorting out the eventual estate. Will-writing companies, banks and solicitors may be taking consumers for a ride by appointing themselves as executors in the will and charging over the odds for taking an estate through probate.

Some banks and will-writers can offer their services as a loss leader; they can recoup their money tenfold by ensuring they are included in the will as executors, then levying bumper fees when the testator passes away. After death, it is difficult to remove executors from a will; as a result, estates can be hit with unspecified charges of as much as 4.5 per cent, or £22,500 on a £500,000 estate.

“Wills are now also being written by unqualified people who have no professional ethics whatsoever,” says Adam Walker, the director of Final Duties, an independent probate broker.

Will-writing firms are able to offer discounted services for as little as £50, or even free as in the case of Barclays which includes it as part of its monthly fee-charging packaged current account. But they can then charge an executor’s fees. An executor’s role is to ensure that all the legal formalities are completed after the death, with typical duties including evaluating the value of the deceased’s assets, clearing any outstanding debts and taxes, then distributing the assets in accordance with the will.

Barclays has been labelled as one of the worst culprits and accused of failing to explain to its customers the true consequences of writing itself in as executor. Mr Walker says that, in his experience, Barclays is by far the most aggressive about refusing to renounce its position as executor and uses forceful sales tactics to persuade customers to appoint it in the first place. “Their game plan is to get you into the branch to talk to the business manager, who really is just a salesman,” says Mr Walker.

We took this accusation to Barclays, which said that it acts as executor in only a minority of cases and its policy is to step down when asked to do so by a beneficiary.

“Appointing us to act as the executor of the estate is a decision that clients positively make to help their estate in a difficult time, and in full awareness of our fees. It is certainly not a pre-requisite for clients to use the executor service,” said Barclays. The bank also defended its fees, which can be as much as 4.5 per cent of the estate, as being fair considering the amount and quality of work involved.

But a fee of 4.5 per cent seems very high when compared with that of even the most experienced solicitors, which do the same work at a fee of less than a quarter of what Barclays is charging. What’s more, Barclays outsources some probate work to ITC Legal Services, an unregulated firm which charges clients with a larger estate only 1 per cent if instructed directly. “Barclays is potentially charging a mark-up of 300 per cent. This is obscene,” Mr Walker said.
Barclays is by no means alone, however, and this is quickly becoming a problem across the whole industry. Solicitors obtained 189,000 grants of probate last year. Final Duties estimates that the bank or solicitor named itself as an executor in about half of these cases, equal to around 95,000 people. Consumers should also be aware that some will-writing companies and banks can be insistent about writing themselves in as a joint or sole executor.

“It is hugely important to pay close attention to the executor clause in the will and to ensure the person or company named is your choice,” says Peter McCarthy from the legal services department at consumer group Which?.

“What disturbs us so much about the sort of fees being levied is that there may be very little probate work to do. For example, is it right that a bank closing a savings account with a balance of £100,000 will be earning itself a fee of up to £4,500? Some estates are complex, but when engaging a probate professional instead of agreeing a percentage fee, try to negotiate an hourly rate or a flat fee for the work being done.”

Disturbingly, will-writing firms are unregulated, leaving consumers without a body to turn to should the worst happen. In the case of solicitors, the Law Society gives guidance on fees and provides an avenue for client complaints should things go wrong.

Anyone with an existing will is urged to check who is named as executor and demand to know their charges. If necessary, they should be removed. It is for you to decide who administers your estate and failure to use this right could be unnecessarily costly. “Some solicitors or will-writing companies will add themselves in the first draft as executors in the hope of getting the fees for doing the estate work. But if the testator does not want them to be involved he should ask for them to be taken out before signing the will,” says Charlotte Asbury, a senior paralegal at MTA Solicitors.

A legal document known as a codicil can be added to an existing will which enables unwanted executors to be removed. If you do this, remember that you will have to find a replacement executor. However, a codicil works only if the person drawing up the will is still alive.

For those with a relatively simple estate, family members and close friends are often appointed as the executors. Solicitors can then be used and paid for separately if any complications arise.

“Just because solicitors have not been appointed does not mean that the executors cannot instruct them if it becomes complex or they find they are unable to cope with the matter,” says Ms Asbury. This is a course of action also recommended by Mr McCarthy. “Appoint someone you know and trust as your executor and talk through what is expected of them. Make clear that if they find something too complex or simply are too busy, they are free to appoint a solicitor at the time and agree the fees for carrying out the work.”

Will power: Shock over unexpected fees
David Khan, 69, a retired civil servant from south London, is currently battling to have an unwanted executor removed from the will of his stepfather, Dennis, who died aged 92 in October last year. “We didn’t locate a copy of my stepfather’s will until February, and this was the first time that we saw that the company which had helped Dennis write the will – Will Drafters – had been installed as sole executors. This was a shock as we had already put in a lot of work to trace my father’s accounts.”

David was in for a bigger shock when he estimated Will Drafter’s fees. “For the size of the estate I worked out that they stood to gain about £18,000. I was absolutely horrified that this should happen at such a time when, as a family, we are coping with a bereavement.” David then used probate firm Final Duties and found a quote for only £3,250, but Will Drafters would not stand down as executors. “The best they offered was to drop their fees to 1.75 per cent of the estate ” So David is taking Will Drafters to the High Court, with the support of Final Duties, with the first hearing due later this month.

In response, Will Drafters said that it had only ever quoted David a fee of 1.75 per cent of the estate and the £18,000 figure was untrue. In addition, the firm says that it made clear to David’s stepfather the fees that it charges and that to step aside now as executor would be an “insult” to the memory of the deceased.

Be Safe and use Certainty to register a will on the UK’s National Will Register.

CARDIFF residents have left £2.4m to Cancer Research UK in their wills over the last year, figures reveal.

The charity said that local supporters are playing a vital role in Cancer Research UK’s vision to beat cancer by helping to fund its life-saving research.

The charity spent almost £4m on research in Cardiff last year, supporting the work of some of the UK’s leading scientific and clinical research.
It funds work led by Professor Alan Clarke, at Cardiff University, who is studying a molecule called APC, which is faulty in many cases of bowel cancer.

Nick Georgiadis, legacy fundraising manager at Cancer Research UK, said: “Leaving a gift to charity is a simple way for anyone to support a good cause.

“Without the income we receive from legacies each year, we would not be able to continue all our world-class research into the causes and treatments of all forms of cancer.

“Our work has saved millions of lives across the world, and over the next decade we aim to save many more. But we can’t do this without the support of the public, and in these difficult times, we need that more than ever.”
Around 1,500 people are diagnosed with cancer every year in Cardiff. But more people are surviving the disease as a result of earlier detection, more effective diagnosis and improved treatments.

Be Safe and use Certainty to register a will on the UK’s National Will Register.

Families are being urged to take prompt action to cut potential inheritance tax bills amid fears that the precarious state of the country’s public finances could mean an end to generous thresholds. Inheritance tax (IHT) is charged at 40 per cent on legacies, though bequests to a spouse or charity are free of tax and the first £325,000 of any other bequest is tax-free.

Growing public resentment over the increasing number of people forced to pay inheritance tax has pushed the tax up the political agenda. In October 2007, the Conservative party pledged to raise the threshold at which the tax kicks in to £1million, allowing a couple to pass on £2million of wealth between them.

Days later the Chancellor used his Pre-Budget Report to allow the surviving spouse from a married couple to use the tax-free allowance if their husband or wife had not used it. The move instantly saved families of thousands of widows and widowers up to £130,000.

But Darling’s generosity is proving expensive. Inheritance tax pulled in £3.8billion for the Treasury in the tax year 2007-08. This is forecast to fall to just £2.2billion in the current tax year as a result of lower house prices and the doubled allowance for couples.

And the worsening state of the public finances means it will become more challenging for politicians to keep their promises on taxation and spending.
The Liberal Democrats last week warned they might delay plans to scrap student tuition fees. And there will be tough talking at the Labour and Conservative party conferences over the next fortnight.

Earlier this month, the Treasury said that the Conservatives’ plan to raise the limit to £1 million would cost about £5billion over the next four tax years. The Conservatives say this could be covered by other taxes.

Andrew Priestley, head of technical services at Skipton Financial Services, says: ‘As the economy has deteriorated, an increase in the IHT allowance is going to be more difficult for politicians to deliver.’

Leonie Kerswill, tax partner in the London office of accountant PricewaterhouseCoopers, says: ‘There is this £1million carrot dangling that says to people, “If the Conservatives get in, I don’t have to worry about inheritance tax” and so tax planning has gone off their radar. But you shouldn’t make your financial plans on the basis of something that may not come true.’

She says families should take action now, as every month can count in reducing a future tax bill.

Financial Mail last week attended a seminar for customers of insurer NFU Mutual in Matlock, Derbyshire. The session covered a range of financial topics, but the room really came to life once speakers tackled inheritance-tax and how to reduce the bill.

The audience was made up of farmers, retirees and owners of small businesses. One of those attending was Gill Fearn from nearby Darley Dale. Gill, 63, and husband Brian, 72, run a nursery and horticultural business. They are protecting themselves against IHT by gifting money to their son to help with a house deposit and by buying life cover, where the sum payable will be held in trust.

Gill, who is set to become a grandmother for the first time next year, says: ‘I regard myself as a custodian of wealth. We are keen to pass our wealth on to the next generation and the one after that.’

Gill benefited from the doubled nil-rate allowance when her own mother Barbara died this year. But the legacy means she and Brian have to look again at their own IHT plans.

Sue Haughton, a chartered financial planner with NFU Mutual, told the seminar that some couples should rewrite their wills following the October 2007 Pre-Budget changes.

Many couples previously ensured that both husband and wife used their full IHT allowance by setting up will trusts on their death. But this is now unnecessary for tax purposes. Trusts are needed only if parents want to ringfence assets for a particular dependant, for example children by a prior marriage.

Her comments rang a bell with Bill and Jean Dilks, who farm near Belper. The couple have two grownup children and are keen to ensure both benefit equally after their deaths without breaking up the farm.

Bill, 65, says: ‘I’ve realised it is time to go to our solicitor and get fresh advice about our wills because they seem out of date.’
Five steps to ensure your legacy comes without a large bill

Find out your worth.

You cannot plan until you know whether IHT will be an issue. Get an idea of your overall wealth and the value of the estate you will leave after paying debts.

Do you need it all?
Even if your wealth is above the IHT threshold of £325,000 (or £650,000 for a married couple) much may be tied up in your home or be used to provide income. Only give away what you are sure you do not need.

Exploit allowances.
Gifts made in the seven years before you die count for IHT. But tax rules allow you to pass on something each year without affecting your IHT allowances. You can give up to £250 a year to as many people as you like and make other gifts totalling £3,000 a year.

Parents can also give £5,000 to their children when they marry – while grandparents and other relatives can give £2,500 on marriage.

Gifts of any value made out of regular income are also possible provided you can show that you did not run down savings or reduce your standard of living making them. But these rules are complex and advice is vital.

Plan for the tax bill.
You can help your family meet any IHT demand by buying a whole-of-life insurance policy. This can be held in trust outside your estate and produces a lump sum to pay your IHT bill on your death. Or ask your children to pay the premium on your behalf.

Keep good records.
After your death your family will have to prove to Revenue & Customs that you followed all the rules. It is vital to keep records of what you’ve got and what you have given away.

Be Safe and use Certainty to register a will on the UK’s National Will Register.

Published: Oct 14 2009 Source: Graeme Brown, Birmingham Post

A Midland lawyer who specialises in services for the elderly has warned that some unqualified will writing services are the equivalent of cowboy operators in the building trade.

Fiona Barnes, a partner at Shropshire-based MFG Solicitors and head of the firm’s private client division, warns that dying without a will is bad enough but a badly written or out of date will could be just as dangerous.

“Some of these services can be highly unsatisfactory just as cowboy operators in the building trade rip off unsuspecting clients. Anyone can call themselves a will writer – whether or not they have any training or experience. The result of a badly written will can lead to arguments and even an expensive court case – the costs for which are likely to be paid from the deceased’s estate.

“Many non-regulated and non-trained will writing services induce clients by marketing their low cost service.

“Few people realise, until they actually instruct them, that there are many hidden costs including an annual fee to store original documents with them, while many solicitors store wills without charge.
“One reason for their – on the face of it – low cost will packages is because they do not have to pay any annual fees to insurance or regulatory bodies.
“It means that in the event of their negligence there will be no compensation for the additional and unnecessary distress caused to already grieving family members.

“There is no regulatory body whose code of conduct applies. The service may simply disappear, making it impossible to find the will, which under agreement was supposed to have been kept in a safe place.
“Clearly the advantage of seeking advice from fully regulated organisations such as solicitors is the reassurance of knowing you are receiving accurate and up to date advice from a qualified professional who has a duty of care and confidentiality.

“Executing a will within a proper legal framework allows a person to ensure that possessions will be dealt with in accordance with wishes and by trusted people. There are a number of other attractions in drawing up a will which few people appreciate, even some so-called will writers.
“For example, being able to appoint guardians for minor children, to make provision for children, grandchildren, an elderly or disabled relative and balance the needs of those different beneficiaries – as well as protection of assets, excluding relatives if appropriate and leaving gifts of cash or possessions.”

Not every unqualified will writer will recognise or understand all the possible issues – and ways to resolve them – so Fiona Barnes urges caution when deciding who should write one of the most important legal documents you ever complete.

Be Safe and use Certainty to register a will on the UK’s National Will Register.

Source: Money Talk, BBC
By Edward Chivers
Buss Murton solicitors

Last week Christine Gill successfully challenged her mother’s Will which had left more than £2m to the RSPCA.

This court challenge is likely to result in an appeal by the animal charity.

But it is just the latest in a long line of high profile, and often bitter, disputes surrounding the estates of deceased family members.

Challenging a Will is an expensive undertaking, both in terms of time, money and emotional effort.

Accusations fly, families squabble, charities huff and puff, and someone has to pick up the tab.

Yet it does not seem to deter an increasing number of individuals from challenging the Wills of deceased family members.

It is difficult to pinpoint the exact reasons for such an increase, but the increased wealth generated by many ordinary people over the past two decades has been an obvious factor.

Other influences have been the sharp increases in house prices in the past decade or so, the current recession, and increasingly complex family structures, often with children from two or more marriages.

Not enough

Typically, there are three grounds for challenging a Will in England and Wales.

The first of these is under the Inheritance (Provision for Family and Dependants) Act 1975.

This is the only statutory means of arguing that not enough was set aside for you in the final Will.

In order to bring such a claim, a potential claimant must overcome two objective hurdles.

First, they must be eligible to bring a claim under the Act and, secondly, they must be able to show that, immediately prior to the death, they were dependent upon the deceased.

The most common scenario would be children and co-habiting couples.

The purpose behind the Act has been neatly summed up by Baroness Hale in the recent case of Macleod v Macleod [2009].

“It is contrary to public policy to cast onto the public purse an obligation which ought properly to be shouldered within the family,” she said.

This piece of legislation should always be borne in mind by solicitors when drafting a Will for a client who wishes to exclude someone who may have a potential claim.

The courts’ application of the law is that it should not be seen as a “scrounger’s charter”.

However an individual making a claim for support as a result of their own financial mismanagement will not attract the sympathy of the court.

Not in control

There are two other ways to challenge a Will.

One is by demonstrating undue influence – that there was an element of coercion.

The other is by showing a lack of testamentary capacity, in other words that the person did not understand what they were doing.

This might be because of mental or physical illness.

It is extremely difficult to succeed in such a claim, as I am sure Ms Gill would testify.

The star witness – the deceased – is dead, making it very hard for the claimant to prove their case.

Ms Gill had to bring expert evidence that suggested her mother suffered from agoraphobia and severe anxiety.

And she successfully demonstrated that her late father was, in the words of the judge, “domineering and bombastic… utilizing her anxiety and fear of his explosive character… to coerce her into making the will which she did”.

‘Dark forces’

In most scenarios proving your case would be extremely difficult, and Ms Gill’s ordeal is not over yet.

Although she has succeeded in getting the £2.3 million estate passed to her, the RSPCA has a statutory duty, as a registered charity, to protect and safeguard its funds, including legacies left via a Will.

They are, therefore, likely to appeal against this decision which would result in months of continued litigation, probably costing tens of thousands of pounds.

This money is most likely to come from the estate, but quite feasibly could end up coming from Ms Gill’s own pocket, or the charitable funds of the RSPCA.

The infamous case of Kostic v Chaplin in 2007 highlights the costs of such an action.

It concerned a dispute over the capacity of the person making the Will who suffered from a serious mental illness and a delusional disorder.

Mr Kostic left his entire estate, worth some £8.2 million, to the Conservative Party.

He favoured them on the grounds that they were not part of an international conspiracy of “dark forces” against him.

The family, understandably none too happy about this, disputed the Will on the grounds of his mental capacity.

They eventually succeeded, but at a cost of £900,000.

Escalating costs

Demonstrating to the court that a testator – the person making the Will – lacked the necessary capacity is, in most cases, a difficult claim to make successfully.

Medical evidence will help to prove your case, but the basic assumption in law is that a person has the capacity to make decisions for themselves.

Potential claimants, and more particularly their legal advisors, need to be aware of the difficulties and costs associated with legal action against a Will.

They should be wary of the fact that, as with all litigation, once the wheels are set in motion they can be hard to stop, as costs escalate and the issue of proportionality comes into play.

Having said this, legitimate claimants should not be put off seeking some initial guidance from their legal advisor.

Be Safe and use Certainty to register a will on the UK’s National Will Register.

This should be an issue of choice which does not rely on everyone else being compelled to do the same. After all, making a choice to ensure traceability of a Will is only relevant to the person who has chosen to register. Importantly the Ministry of Justice has recently confirmed to Certainty that they have no plans to make registration of a Will compulsory, a position acknowledged by most of the legal profession.

However, this does not remove the need to deliver a viable register in order that the public can make the choice to protect themselves. Significantly the Ministry of Justice has given their sanction for a voluntary viable register to offer this choice. In a recent survey 77% of the public questioned said they welcomed and would use a voluntary register and a similar percentage was sceptical about using a government-led initiative.

Certainty meets the need required by the public. Certainty offers a search facility for both registered and unregistered Wills. Therefore even if a client hasn’t registered their Will it can still be searched for after death. In conclusion it should be recognised that compulsory Will registration is highly unlikely in the UK. Certainty has provided a viable voluntary register which works in the best interests of both the public the profession.

Be Safe and use Certainty to register a will on the UK’s National Will Register.

I’ve already got a Will in existence and I’ve just discovered that there is a National Will Register website that will allow me to register my Will with them for absolutely no charge to myself! There must be a catch or a hidden fee somewhere surely? On visiting the site, I put their claims to the test of registering within 60 seconds and found them to be true. Registration was quick and easy even for someone who is slow on a keyboard like me!

Free registration is available apparently to everyone who had a Will in existence before 1st January 2008 so anyone with a Will after this date must register at a cost of £25 so it was worthwhile to me registering with the Certainty National Will Register. My son wondered why I was even bothering to store my Will location details on this National Will Register but I think it’s essential to ensure that your Will can be easily found when it needs to be. The last thing I want for my family is for them not to be able to find my Will or spend endless hours trying to locate the address of the solicitors I used so storing the details on a National Will Register makes perfect sense to me.

Although I’m only relatively ‘young’, as I’ve got children, have various life assurance policies and own a house, I’ve decided to arrange to have my Will written to safeguard my family. I’ve just read about the National Will Register ‘Certainty’ and after reading about the benefits it can bring I’m going to select a solicitor in my area through their website so as members they will be able to sign me up as part of the Will Writing process.

There’s every possibility that in the distant future my children might not be aware of where my Will is. Come to think of it I don’t even know the name of my parents solicitor so it makes sense to use a National Will Register that stores the details of the solicitors office where your Will is held. There are a few other Will Registers on the web when I perform a Google search but the Certainty National Will Register seems to offer the most professional service and having a chairman who is a past Law Society President can only be a good thing. All in all the Certainty National Will Register I’ve decided on seems to be a professional organisation that I have entrusted to ensure that my wishes and last testament are accessible to my family when I pass away.