I am an Executor under a will and I am aware that one of the beneficiaries and co executor has entered into an IVA - They did this post information of the will and pre receiving probate. What are my responsibilities as regards his share of the estate. My solicitor isn't a solvency specialist and asked me to contact the IP directly, I have now done this, and the IP has instructed me to send them the funds direclty, am I allowed to do this?
I think I would be inclined to involve the Solicitor again now you have the necessary knowledge. Is the co-executor a relation or close family friend. Depending on their stance with this, it could cause problems in your relationship and lead to bitterness and animosity.
The IP is probably right as the creditors are entitled to any windfalls he receives.However, you would need to take legal advice on the will as often there is a solvency clause which prevents the money going to creditors if a beneficiary is bankrupt or in an IVA.
That's interesting Michael - I always thought that funds had to be paid to the IP company.
Is it possible to put a clause into a will stating that the money cannot go to any creditors and what would happen to a beneficiary when they received an inheritance?
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If you are drawing up a will it is advisable to protect the estate. This means you bar anyone from receiving their inheritance if they are bankrupt or subject to an IVA. The funds are then distributed among the other beneficiaries and not given to the creditors of the insolvent beneficiary. There is nothing wrong in doing this as your relative would not get the money anyway and you certainly do not want your lifelong savings going to a bunch of banks who you never borrowed from in the first place!
I think most wills of the Upper Classes have these clauses but so should those of the man in the street.
Thank you Michael - that is very interesting and something I wasn't aware of.
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The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
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My inheritance was past straight to the IP for distribution to our creditors....I had to sign a document for the solicitor informing I was in an IVA as did all other beneficiaries to declare they were not in an insolvency situation.
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Thank you for the advice, the co-executor is a relation unfortunately, and unfortunately wasn't happy when they heard I had spoekn tot heir IP. But as the leading executor I don't want to do anything illegal or against my executor duties.
The IP asked us to write to them with copies of the probate, and inform them of the amount due to the exectutor, however now they have truned around, and said they need authorisation from the benficiary holding the IVA before they can speak to me.
I appreciate this is the norm, but how do I get this beneficiary to give authorisation? I haven't heard abck from our solicitors, but they will need authorisation as well.
What if he doesn't authorise the IP to speak to either myself or my solicitor, then how do we deal witht he situation?
The estate is small and hence so far we've not used solicitors, just dealt with probate and managing the etstate myself.
Have really hated the process, and now just wish to conclude the estate, there are other beneficiaries,a nd I do not want to hold up their payements.
I don't think it would be possible for your relative not to give permission to their iva firm to talk to you...withholding an asset constitutes a breach of the iva and would almost certainly lead to it's failure. That said, you may need a solicitor to act as liaison and the sensible thing would be to deduct costs from your co-executor's share.
Dev, I am no expert in inheritance and administration of Wills. However, this is how I see it .
You have done the right thing in contacting the IP. The fact that the IP now refuses to communicate with you, without authorisation, is beyond your control.
You are very unlikely to get the benficiaries consent. So, your duty as Executor, is to now tie up the Estate for the benefit of all beneficiaries. If this means paying the beneficiary in an IVA direct, so be it.
It is between him and his IP now.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
That's a very useful piece of information which hasn't come to light in previous questions posted . I'm sure many of us assume that any inheritance would be counted as a windfall and we would have to pay up.
font size="1" face="Verdana, Arial, Helvetica">quote:<hr height="1" noshade>Originally posted by Michael Peoples
If you are drawing up a will it is advisable to protect the estate. This means you bar anyone from receiving their inheritance if they are bankrupt or subject to an IVA. The funds are then distributed among the other beneficiaries and not given to the creditors of the insolvent beneficiary. There is nothing wrong in doing this as your relative would not get the money anyway and you certainly do not want your lifelong savings going to a bunch of banks who you never borrowed from in the first place!
I think most wills of the Upper Classes have these clauses but so should those of the man in the street.
An inheritance is a windfall - I think that Michael is suggesting that the will be amended before the inheritance becomes an entitlement. If the named beneficiary in the will is insolvent, then there is no avoiding the windfall or after-acquired property provisions unfortunately.
So if I got my mum to change the wording of her will so that I'm barred from receiving any inheritance and that the all proceeds go to my sister - does that prevent my creditors receiving anything?
font size="1" face="Verdana, Arial, Helvetica">quote:<hr height="1" noshade>Originally posted by MelanieGiles
An inheritance is a windfall - I think that Michael is suggesting that the will be amended before the inheritance becomes an entitlement. If the named beneficiary in the will is insolvent, then there is no avoiding the windfall or after-acquired property provisions unfortunately.
