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Joint Will

including wills and probate
hiriskpaul
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Re: Joint Will

#521740

Postby hiriskpaul » August 11th, 2022, 7:00 pm

Lootman wrote:
hiriskpaul wrote:HMRC manual says a mutual Will cannot be revoked after one party dies:

https://www.gov.uk/hmrc-internal-manual ... /ihtm12063

That link appears to suggest that an implicit Trust is created and is effective upon the first death that binds the survivor. And if the survivor breaks with that then they are liable to be sued by whomever is thereby disadvantaged. Or rather, since they are dead by this point, that her executor would be liable for distributing her estate in contradiction to what the mutual Will specified.

So it sounds like any enforcement of this relies on the Will beneficiary being aware of the situation and being willing to sue the executor of the survivor's estate for restitution.

Perhaps. What springs to mind here is that I do not know some of the beneficiaries on the second death and that a lot of money is involved here, so there is a risk that a beneficiary could get difficult.

Clitheroekid
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Re: Joint Will

#521760

Postby Clitheroekid » August 11th, 2022, 9:55 pm

hiriskpaul wrote:Curiously, this HMRC page https://www.gov.uk/hmrc-internal-manual ... /ihtm12061, states

Whatever the type of Will, property held jointly (IHTM15001) and passing by survivorship (IHTM15081) cannot be subject to any Will but passes automatically to the surviving owner(s).


So presumably their jointly held property and bank accounts are not restricted by the Will. If so, can a Will be written to cover these assets? Or another joint tenants relationship entered into for these assets?

You cannot dispose of jointly owned property by Will, as the doctrine of survivorship means that the property automatically vests in the survivor, irrespective of what the Will says.

However, there's a lot of confusion about what joint ownership actually means. Legal title is not the same as what lawyers call `beneficial' ownership - the right to enjoy the subject matter.

The most obvious example is where a house is owned by two people as tenants-in-common. On death the legal title passes to the survivor by the law of survivorship. But the beneficial title passes according to the terms of the tenancy-in-common. So if they owned it on a 70:30 basis and the deceased owned the 70% that share passes to whoever inherits his estate, and not to the surviving owner.

This can cause massive confusion when it comes to bank accounts. I'm dealing with a case at present where the deceased left about £130k in a bank account that was in joint names with her son. He's saying that the cash has passed to him by survivorship, and that it therefore belongs to him. He's quite adamant that it does not form part of the estate, and he's saying he must be right as the bank have transferred the account into his sole name.

But it's not as straightforward as it seems. I've discovered that the deceased only added him to the account a couple of years ago, and so far as I can ascertain he has contributed nothing at all into the account. I suspect that he was added merely to facilitate managing the account, as the deceased was more more or less bed bound for the last couple of years of her life. So far as I'm aware there's no evidence that she meant him to inherit the cash in the account.

Consequently, I intend to argue that the cash does form part of the estate, and that although he has legal title to it he holds it as trustee for the estate.

It's quite worrying that banks, who are supposedly so keen to protect their customers, allow this sort of thing to happen without, it seems, ever considering the consequences. In practical terms, as the account is now in his sole name there's nothing to stop him withdrawing the cash and vanishing. Would / should the bank be liable in that situation? Answers on a postcard!

hiriskpaul
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Re: Joint Will

#521774

Postby hiriskpaul » August 11th, 2022, 10:47 pm

Clitheroekid wrote:
hiriskpaul wrote:Curiously, this HMRC page https://www.gov.uk/hmrc-internal-manual ... /ihtm12061, states

Whatever the type of Will, property held jointly (IHTM15001) and passing by survivorship (IHTM15081) cannot be subject to any Will but passes automatically to the surviving owner(s).


So presumably their jointly held property and bank accounts are not restricted by the Will. If so, can a Will be written to cover these assets? Or another joint tenants relationship entered into for these assets?

You cannot dispose of jointly owned property by Will, as the doctrine of survivorship means that the property automatically vests in the survivor, irrespective of what the Will says.

However, there's a lot of confusion about what joint ownership actually means. Legal title is not the same as what lawyers call `beneficial' ownership - the right to enjoy the subject matter.

The most obvious example is where a house is owned by two people as tenants-in-common. On death the legal title passes to the survivor by the law of survivorship. But the beneficial title passes according to the terms of the tenancy-in-common. So if they owned it on a 70:30 basis and the deceased owned the 70% that share passes to whoever inherits his estate, and not to the surviving owner.

This can cause massive confusion when it comes to bank accounts. I'm dealing with a case at present where the deceased left about £130k in a bank account that was in joint names with her son. He's saying that the cash has passed to him by survivorship, and that it therefore belongs to him. He's quite adamant that it does not form part of the estate, and he's saying he must be right as the bank have transferred the account into his sole name.

But it's not as straightforward as it seems. I've discovered that the deceased only added him to the account a couple of years ago, and so far as I can ascertain he has contributed nothing at all into the account. I suspect that he was added merely to facilitate managing the account, as the deceased was more more or less bed bound for the last couple of years of her life. So far as I'm aware there's no evidence that she meant him to inherit the cash in the account.

Consequently, I intend to argue that the cash does form part of the estate, and that although he has legal title to it he holds it as trustee for the estate.

It's quite worrying that banks, who are supposedly so keen to protect their customers, allow this sort of thing to happen without, it seems, ever considering the consequences. In practical terms, as the account is now in his sole name there's nothing to stop him withdrawing the cash and vanishing. Would / should the bank be liable in that situation? Answers on a postcard!

I have joint current and savings accounts with an elderly relative who does not use the Internet, smartphones, etc. just so I can order things online and make other payments for them. I have written a statement that I keep with my belongings and my relative's saying that none of the money in the account is mine and that I have a joint account for convenience. Hopefully that should make the situation clear to relevant executors.

chas49
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Re: Joint Will

#521777

Postby chas49 » August 11th, 2022, 11:10 pm

Moderator Message:
The discussion about legal/beneficial ownership of jointly held assets is very interesting and deserves its own thread.

Please continue that discussion here viewtopic.php?f=2&t=35544&start=20

Thanks

Clitheroekid
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Re: Joint Will

#522709

Postby Clitheroekid » August 15th, 2022, 8:05 pm

chas49 wrote:
Moderator Message:
The discussion about legal/beneficial ownership of jointly held assets is very interesting and deserves its own thread.

Please continue that discussion here viewtopic.php?f=2&t=35544&start=20

Thanks

Unfortunately, whilst I can see the logic of splitting the thread it's had the effect of killing the discussion stone dead! I suspect that anyone with a further enquiry would now be confused as to which thread they should use, so might just not bother to post at all.

Legal Issues (Practical) has always been a fairly broad church, unlike some of the sites relating to the various HYP cults, so in general terms I think it's OK just to let a discussion ramble onwards, even if it does drift away from the original topic a bit. They usually run out of steam of their own accord anyway.

chas49
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Re: Joint Will

#522741

Postby chas49 » August 16th, 2022, 12:02 am

Clitheroekid wrote:
chas49 wrote:
Moderator Message:
The discussion about legal/beneficial ownership of jointly held assets is very interesting and deserves its own thread.

Please continue that discussion here viewtopic.php?f=2&t=35544&start=20

Thanks

Unfortunately, whilst I can see the logic of splitting the thread it's had the effect of killing the discussion stone dead! I suspect that anyone with a further enquiry would now be confused as to which thread they should use, so might just not bother to post at all.

Legal Issues (Practical) has always been a fairly broad church, unlike some of the sites relating to the various HYP cults, so in general terms I think it's OK just to let a discussion ramble onwards, even if it does drift away from the original topic a bit. They usually run out of steam of their own accord anyway.


A fair point - probably a 'damned if you do, or damned if you don't' moderation here - but we don't discuss moderation so I'll just leave that there,,,

CliffEdge
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Re: Joint Will

#522762

Postby CliffEdge » August 16th, 2022, 8:03 am

As lootman often advocates, it is often possible to skirt around the letter of the law and take a more decisive approach in these cases using individual judgment, but this can put a lot of power in the wrong hands in some cases. Best to avoid this risk, if it is truly feared to be a real potential risk, in the first place.
It is always difficult to apply simple solutions to complex situations, but complex solutions can end up worse in my experience.
This something we all might have to face.

hiriskpaul
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Re: Joint Will

#527306

Postby hiriskpaul » September 3rd, 2022, 11:47 pm

Thought I would post an update on this. As clitheroekid commented upthread I was mixing up mutual Wills with the joint Will which we have been given, so a new Will can be written by the survivor. It has occurred to me that there may be other issues with the Will and we will encourage my wife's aunt to write a new Will, hopefully with the help of a solicitor! Hopefully there should be no issues with the existing Will as the intention on the first death is quite clear.

One of the potential issues I can see is with the charitable donations. eg one of them is "Medway Maritime Hospital", another "Moorfields Eye Hospital". I may be being paranoid, but what is intended is that the gifts are made to charities associated with these hospitals and I have found details of the precise charities in the deceased's filing cabinet. I would rather all the charities mentioned in the Will were precisely and uniquely specified. Am I being paranoid here, or has someone had issues with ambiguous beneficiaries like this in Wills?

staffordian
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Re: Joint Will

#527318

Postby staffordian » September 4th, 2022, 8:42 am

hiriskpaul wrote:
One of the potential issues I can see is with the charitable donations. eg one of them is "Medway Maritime Hospital", another "Moorfields Eye Hospital". I may be being paranoid, but what is intended is that the gifts are made to charities associated with these hospitals and I have found details of the precise charities in the deceased's filing cabinet. I would rather all the charities mentioned in the Will were precisely and uniquely specified. Am I being paranoid here, or has someone had issues with ambiguous beneficiaries like this in Wills?

You refer to "charitable donations" above. Is this term from the will or simply your shorthand for bequests?

Just thinking that if the will refers specifically to charitable donations, that surely clarifies the intent?

hiriskpaul
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Re: Joint Will

#527325

Postby hiriskpaul » September 4th, 2022, 9:34 am

staffordian wrote:
hiriskpaul wrote:
One of the potential issues I can see is with the charitable donations. eg one of them is "Medway Maritime Hospital", another "Moorfields Eye Hospital". I may be being paranoid, but what is intended is that the gifts are made to charities associated with these hospitals and I have found details of the precise charities in the deceased's filing cabinet. I would rather all the charities mentioned in the Will were precisely and uniquely specified. Am I being paranoid here, or has someone had issues with ambiguous beneficiaries like this in Wills?

You refer to "charitable donations" above. Is this term from the will or simply your shorthand for bequests?

Just thinking that if the will refers specifically to charitable donations, that surely clarifies the intent?

No, it just says "Then there are legacies for:" and lists 6 beneficiaries with fixed amounts.

Dod101
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Re: Joint Will

#527331

Postby Dod101 » September 4th, 2022, 10:13 am

In my Will I have the charity reference number so that there is no ambiguity, but in your case, who is going to complain if you get one wrong? I suppose the charity which did not benefit might but how will they know? I cannot imagine any individual beneficiary being too concerned.

Dod

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Re: Joint Will

#527339

Postby staffordian » September 4th, 2022, 10:47 am

Dod101 wrote:In my Will I have the charity reference number so that there is no ambiguity, but in your case, who is going to complain if you get one wrong? I suppose the charity which did not benefit might but how will they know? I cannot imagine any individual beneficiary being too concerned.

Dod

Good point, and even more to the point, Moorfields Eye Hospital, for example, are hardly going to complain if the executor makes a payment to Moorfields Eye Hospital's supporting charity. I read the ambiguity as being between giving to a charity and giving to the hospital trust, not between two charities, and as you say, the other party would never know. I don't imagine a hospital trust want chapter and verse on any donation made to its (independent?) supporting charity.

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Re: Joint Will

#527360

Postby scrumpyjack » September 4th, 2022, 11:59 am

hiriskpaul wrote:Thought I would post an update on this. As clitheroekid commented upthread I was mixing up mutual Wills with the joint Will which we have been given, so a new Will can be written by the survivor. It has occurred to me that there may be other issues with the Will and we will encourage my wife's aunt to write a new Will, hopefully with the help of a solicitor! Hopefully there should be no issues with the existing Will as the intention on the first death is quite clear.

One of the potential issues I can see is with the charitable donations. eg one of them is "Medway Maritime Hospital", another "Moorfields Eye Hospital". I may be being paranoid, but what is intended is that the gifts are made to charities associated with these hospitals and I have found details of the precise charities in the deceased's filing cabinet. I would rather all the charities mentioned in the Will were precisely and uniquely specified. Am I being paranoid here, or has someone had issues with ambiguous beneficiaries like this in Wills?


My mother's Will left a legacy to a charity that we found no longer existed. We therefore looked for a similar charity and gave it to them. I think it is better for the executor to have some leeway here. That also helps avoid aggressive interference by charities in the administration of the estate, which can happen!

staffordian
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Re: Joint Will

#527361

Postby staffordian » September 4th, 2022, 12:04 pm

scrumpyjack wrote: I think it is better for the executor to have some leeway here. That also helps avoid aggressive interference by charities in the administration of the estate, which can happen!

That's the old "never give 'em a percentage" advice.

No arguments if the legacy is £x but if it's x% they can pester to ensure the total estate, and hence their slice, is as large as it can be.

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Re: Joint Will

#527370

Postby Dod101 » September 4th, 2022, 12:52 pm

staffordian wrote:
Dod101 wrote:In my Will I have the charity reference number so that there is no ambiguity, but in your case, who is going to complain if you get one wrong? I suppose the charity which did not benefit might but how will they know? I cannot imagine any individual beneficiary being too concerned.

Dod

Good point, and even more to the point, Moorfields Eye Hospital, for example, are hardly going to complain if the executor makes a payment to Moorfields Eye Hospital's supporting charity. I read the ambiguity as being between giving to a charity and giving to the hospital trust, not between two charities, and as you say, the other party would never know. I don't imagine a hospital trust want chapter and verse on any donation made to its (independent?) supporting charity.


You have reminded me of when my first wife was being treated with kidney dialysis three times a week at a large teaching hospital. I used to give them a donation from time to time and they had a specific charitable fund for this work. They specified the particular charity not the hospital trust itself and I imagine that they had one for most of their individual disciplines. I think when the time is appropriate the executor should have a word with Moorfields and ask them to whom they would like the remittance payable. They will probably be happy to give a bit of background to the way they are set up so that you/the executor can be reassured that the donation is going to the right spot.

Dod

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Re: Joint Will

#527372

Postby scrumpyjack » September 4th, 2022, 12:56 pm

Take care because hospital trusts are not charities so you might find the legacy is not allowed as a deduction for IHT calculation!

https://www.thirdsector.co.uk/nhs-found ... le/1668783

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Re: Joint Will

#527375

Postby Dod101 » September 4th, 2022, 1:01 pm

scrumpyjack wrote:Take care because hospital trusts are not charities so you might find the legacy is not allowed as a deduction for IHT calculation!

https://www.thirdsector.co.uk/nhs-found ... le/1668783


And that I imagine is why the charity that I referred to in my previous post was set up by the hospital trust.

Dod

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Re: Joint Will

#527435

Postby Crazbe7 » September 4th, 2022, 7:06 pm

hiriskpaul wrote:
staffordian wrote:
hiriskpaul wrote:
One of the potential issues I can see is with the charitable donations. eg one of them is "Medway Maritime Hospital", another "Moorfields Eye Hospital". I may be being paranoid, but what is intended is that the gifts are made to charities associated with these hospitals and I have found details of the precise charities in the deceased's filing cabinet. I would rather all the charities mentioned in the Will were precisely and uniquely specified. Am I being paranoid here, or has someone had issues with ambiguous beneficiaries like this in Wills?

You refer to "charitable donations" above. Is this term from the will or simply your shorthand for bequests?

Just thinking that if the will refers specifically to charitable donations, that surely clarifies the intent?

No, it just says "Then there are legacies for:" and lists 6 beneficiaries with fixed amounts.


I have recently updated my will and have been advised to reference all donations to charity as 'Charitable Legacies, quoting the Charity Reference No. and address at that time. Apparently makes the donation clear for any Inheritance Tax issues.

I also have specific wording if the charity amalgamates or closes to give my executor(s) discretion in allocating the legacy to another charity. Again to cover any Inheritance tax issues.

Crazbe7

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Re: Joint Will

#527437

Postby Lootman » September 4th, 2022, 7:20 pm

Crazbe7 wrote:I also have specific wording if the charity amalgamates or closes to give my executor(s) discretion in allocating the legacy to another charity. Again to cover any Inheritance tax issues.

I would have thought that an executor always has discretion to use his/her judgement to vary a Will if there is a good reason to do so. In that case explicitly stating in the Will that the executor can do that seems redundant.

Using judgement is part of the job of an executor. He/she merely needs to be able explain and justify why there was a variation from the Will. Saving IHT would be an obvious one, as would responding to a request from a beneficiary to cede their bequest in favour of another beneficiary.

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Re: Joint Will

#527471

Postby Crazbe7 » September 4th, 2022, 10:14 pm

Lootman wrote:
Crazbe7 wrote:I also have specific wording if the charity amalgamates or closes to give my executor(s) discretion in allocating the legacy to another charity. Again to cover any Inheritance tax issues.


I would have thought that an executor always has discretion to use his/her judgement to vary a Will if there is a good reason to do so. In that case explicitly stating in the Will that the executor can do that seems redundant.


You may think that. I don't. The only area of flexibility is on the residue of my estate where they have been given more flexibility to meet my charitable legacy requirements.

Crazbe7


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