Well, this doesn't seem to be covered in the texts so I'm throwing it open to the floor...

I've just recevied a sub for cl who's husband passed away in '07 leaving 21k or so in realisable capital. Unfortunately he was also in receipt of Pension Credit...

DWP got wind of the capital and after an investigation have notified a recoverable overpayment of every penny they've paid to husband since '98. A humble 13k with council tax benefit probably lurking in the wings.

The submission contains little beyond correspondence between various advice agencies during the appeal and 9 years worth of printouts and then A14, not a single claim pack.

The Decision maker is relying on S126 SSAA which demands that any person who represented the person before they died provide info and therefore in not so doing the widow hasn't kept her end of the bargain up, however the widow didn't represent hubby before he died hence I don't think they'll get anywhere with that.

So point one is the burden of proof, which falls on the bad guys and is a long way from satisfied.

Point two is whether, the estate; having been distributed to it's beneficiaries, still holds value and hence enough value to recover from.Can an executor be held personally liable for the deceased's liabilities?

Finally, help! I've never come across anything like this before and I'm stumped.

Ta!

An executor is personally liable to a disappointed creditor if he distributes the estate without advertising for creditors and other beneficiaries to come forward (there is a procdure for this and if probate was done through a solicitor I would expect the executor to have been advised of it).
If the advertisments were made and the estate was then correctly distributed after waiting the specified time, the executor no longer has any personal liability, but the disappointed creditor can trace the estate into the hands of the beneficiaries if it still exists in a traceable form (eg, not spent on household repairs or living expenses).
The reason for this is that in probate law the debts all have to be paid before a penny is paid to the beneficiaries, and if there is nothing left over for them that is just tough.

Thanks for that, however what happens if the debt only arises after the distribution of assets?

They didn't decide the overpayment until 15 months after the deceased departure.

In this case the executor was sole benficiary and gave most of the capital to her son who's business was struggling at the time. She didn't realise, when the rest of the money ran out that she would lose most of her PC ents due to the perceived deprivation. So she's pretty skint.

i think the need for specialist wills advice is appropriate, but so far as i recollect (and I think Ariadne will be able to help as well on this)

"Can an executor be held personally liable for the deceased's liabilities"

yes, as the executor is a form of trustee and the estate can't be distributed until its debts, if any, are paid.

whether there were any being another matter, of course...

Thanks for that although by the time I'd read CIS/1423/1997 I'd sussed it.

One thing of interest, I've bumped into a few solicitor's sites while surfing on the train home and some suggest a period of two months for any creditors to make a claim against the estate, if they advertise in the London Gazette.

Do we know of any limit on such a claim being made if the death is not advertised?

A copy of the decision in Secretary of State for Social Services v Solly <1974> 3 All ER 922 would be handy but I woundn't know where to start looking.

This is the statutory provision from s 27 of the Trustee Act 1925:

27 Protection by means of advertisements
(1)With a view to the conveyance to or distribution among the persons entitled to any real or personal property, the trustees of a settlement, trustees of land, trustees for sale of personal property or personal representatives, may give notice by advertisement in the Gazette, and in a newspaper circulating in the district in which the land is situated and such other like notices, including notices elsewhere than in England and Wales, as would, in any special case, have been directed by a court of competent jurisdiction in an action for administration, of their intention to make such conveyance or distribution as aforesaid, and requiring any person interested to send to the trustees or personal representatives within the time, not being less than two months, fixed in the notice or, where more than one notice is given, in the last of the notices, particulars of his claim in respect of the property or any part thereof to which the notice relates.
(2)At the expiration of the time fixed by the notice the trustees or personal representatives may convey or distribute the property or any part thereof to which the notice relates, to or among the persons entitled thereto, having regard only to the claims, whether formal or not, of which the trustees or personal representatives then had notice and shall not, as respects the property so conveyed or distributed, be liable to any person of whose claim the trustees or personal representatives have not had notice at the time of conveyance or distribution; but nothing in this section—
(a)prejudices the right of any person to follow the property, or any property representing the same, into the hands of any person, other than a purchaser, who may have received it; or
(b)frees the trustees or personal representatives from any obligation to make searches or obtain official certificates of search similar to those which an intending purchaser would be advised to make or obtain.
(3)This section applies notwithstanding anything to the contrary in the will or other instrument, if any, creating the trust.

So yes, the minimum period is 2 months from advertisment to distribution.
I presume that against the executors the usual statutory limitation period of 6 years would apply, both to unadvertised estates and to time lapse from advertisments, except for possible untraced beneficiaries against whom time doesn't run until they know that they are. I don't know about limitations on tracing against wrognful distribution.

The point as to whether the debt existed at the date the estate was distributed is an interesting one, though of course if there had been an overpayment you can say it did. There is an additional complication, which is that the right to trace into the hands of a beneficiary who is also a trustee in breach is, frankly, a mess.

To find a copy of the All England Law Reports (and note that the correct citation of this case has the year in square brackets <1974> - there is a style difference between a case that was heard in a particular year and one that was only reported in a particular year), you either need a subscription to Lexis or a friendly solicitor/law library who has this series of law reports.

i have it, i will email you....

Brilliant. Thank-you

Thu 04-Feb-10 03:09 PM by shawn

dan, i did email you last night about this, using the link below your name, and asked you to email me on cmh AT cmhsolicitors.co.uk ... if you did, I haven't got that! then if you do that, i can send you attachment..

Thu 04-Feb-10 09:09 AM by Dan_manville

Thank you both... I've not received that mail and although i can't find the facility to check I'm quite sure my user settings are correct, just in case could someone check that it's dan AT btu.org.uk.

Clare it'd be worth asking Shawn to get rid of that AT sign before the spambots spot you...

Ariadne, a, thank you, b you might've noticed by now this forum doesn't like , it's a script thing. That was with a silent "square brackets"

The Trustees Act stuff was exactly what I was hoping to hear, I can remember some caselaw re overpayments where they couldn't be held to exist until determined (I'll track that down) then maybe, just maybe, there's something in this.

"DWP got wind of the capital"...

I have almost no knowledge on this subject, but my understanding (from an issue long ago) is that the DWP is supposed to issue a certificate via the solicitor before the estate is distributed - if the deceased was receiving means-tested benefits.

The certificate should state whether DWP have an interest in the estate or not (presumably to cover boxes of money under the bed etc.).

A different type of liability might arise if the estate was distributed by a solicitor without going through the correct procedures and a later problem arose. In the case I am thinking about, the beneficiaries were chased directly by the DWP, but unfortunately I never heard about the final outcome.

"Clare it'd be worth asking Shawn to get rid of that AT sign before the spambots spot you..."

oopsy! Shawn? too late for me to edit!

duly edited ... !

thanks shawn!

Steve, is "long ago" more than 6 years? Might you still have the file (he asks as his luck; finally pushed too far, falls off the precipice...)

I'll have a dig around the admin act and see what I can see.

The Solly decision (cheers again Claire) is very thin considering it's cited so far and wide. There's little consideration of how and why an amount might be recovered, yet commentary, somewhere, told me it was surprising they came to the decision they did. (probably the decision I mentioned above).

The substantive defence was "you didn't send the notices to the correct address" from someone who clearly thought he could duck the question, so the Court, in somewhat more verbose terms said "get stuffed, pay up" but didn't explain why he was liable to any great extent.

Ho hum!

Hi Dan, my one was actully a coleague's own experience around 8 - 10 yrs ago (she no longer works with us), but I will email her to see what happened. Hopefully she might remember!

You might like to know that the DWP does trawl probates for undeclared capital...and before you ask, details of estates for probate purposes are public information. You sometimes see them in the papers after the death of somebody famous.

They've told us as much...

A rather nive chap has given me codes for Lexis/Westlaw and the like so I've just wasted the afternoon looking for any cases that might set limits on when a liability might be recovered from an estate but I can see nowt.

I think it's fishing time, although to be fair I'm not optimistic. DWP were issuing notices from a couple of months after the death saying "there has been an overpayment, this might harm the value of the estate". I don't think I'd agree that the executor wasn't on notice that a liability might arise and hence distribute the estate reasonably and discharge herself.

Ah well, it's been fun!

Final thoughts, just in case anyone's going to bring a ray of light to my thinking...

A Grant of Administration is for life unless restricted by the court or registrar granting it, more to the point there's no temporal restriction unless so granted. However...

S27 of the '25 Administration of Estates Act indemnifies an administrator against liability where payments have been made in good faith. So one can not be pursued if they thought they were doing the right thing.

OTH S28 AEA raises a personal liability against the administrator where they act fraudulently or without full valuable consideration. So they must be sure they've given it proper thought.

There seem to be questions of capacity within the Non Contentious Probate Rules that might assist in a civil case but I needn't worry about them for now.

If we weigh these against R. (Steele) v Birmingham City Council and another <2005> EWCA Civ 1824; (I've not read Balding yet) the liability can't be said to arise until the final decision's been made, which in this case was at least 15 months after hubby had passed away. This is further complicated by the fact that, in the absence of any reg 14 PAOR '98 offsetting, no full decision's yet been made so there's arguably still no liability. Where an administrator can distribute the estate after 12 months might "valuable consideration" hold?

On a different note, reg 17 PAOR states an overpayment made to one part of a couple can only be recovered from the other partner if they are still a couple... Difficult when one party is deceased. (I think this bit might be very important)

So, if the amount to outstanding cannot be recovered is it recoverable?
Might it be held that there is a civil liability but not one under Social Security law?

Where does the jurisdiction of the Tribunal fail?

Oh so many questions, but it's listed tomorrow so, bar anyone's last minute thoughts, if anyone's still interested in my blatherings, I'll post the results.

my only other thought would be that some input from a wills & trusts person might have been helpful...

if you're lucky the tribunal will take the same view, unless your legally qualified chair knows his stuff on that side of things.

Just a legal footnote: "full valuable consideration" doesn't mean giving it proper thought: it means selling it for what it is worth. "consideration" is a term in contract law - if you do something "for consideration" it means you get money or money's worth for it. There would be no problem for an executor who had disposed of property for full valuable consideration becasue he would have got something of equal value back.

Thank you... So S28 actually means if the administrator defrauds the estate or sells part of it for less than it's worth they are personally liable...

That gives legs to the argument that S27 indemnifies any transactions made in good faith. Hmmm

On a Social Security footnote I was wrong above about the burden of proof. S126 places determining the amount of the overpayment firmly at the feet of the personal rep's; "personal rep" being a term borrowed from probate law.

Tristram & Coates made for interesting reading last night in the library...

so how did you get on?

It was adjourned to give me chance to get the deceased's bank statements. Despite all my legal wranglings; looking at the info client brought to the hearing it looks like the capital was an accrual of benefit during a PC claim and within an AIP so assuming I'm right the job's a goodun.