Education Update - Comment September 2008

Published: 3rd October 2008

Securing income from legacies

Last month we looked at ensuring you are aware of every legacy left to your institution. What are the next steps to take to preserve the legacy?

If you have not already heard from the executors the first step should be to write to the executors of the Will (or the extracting solicitors) informing them that you are aware of the legacy that has been left to you and asking them to confirm an initial estimate of when the legacy is likely to be paid.

If the legacy is a bequest of a specific sum it should be paid once all of the estates debts are paid and sufficient assets have been collected to discharge the legacy. In the event that the legacy takes longer than a year (from the death of the deceased) to be discharged you are entitled to a statutory rate of interest from the end of the one year period until payment. However in normal circumstances we would expect specific legacies to be paid within 6 months unless the estate is particularly complex (or as is common at the moment the main asset is a property which there is difficulty in selling).

If you are a residuary beneficiary the payment typically takes longer as the legatees are paid first. Depending on the size and complexity of the estate it would not be unusual to receive one or more interim distributions as the estate is wound up. We would normally expect estates to be wound up within 12 to 18 months but if there are complicating factors increasing this, the executors should be communicating with you to let you know why

Why do legacies not get paid as quickly as they should?

• More executors are administering estates themselves without taking legal advice. The role of executor is often more complex than expected and the executors get in a mess causing delays.
• Even professional firms such as solicitors take more time than is necessary either because the work is outside of their area of expertise or the volume of other work they have causes delays.
• The first two reasons are the most common reasons for delays but occasionally there are more sinister reasons, such as the executor has deliberately maladministered the estate

So what happens if you do not hear from the executors or there appears to be unreasonable delays in paying any legacy or winding up the estate? Initially it would be sensible to chase the executors/solicitors again but if this does not yield any results then a well timed letter from a solicitor well versed in contentious probate matters often will.

In the event there is still no response more formal instructions to a specialist solicitor may be required.

If you are expecting a legacy and for some reason it hasn't been paid or would like general advice about the management of receiving legacies and would like to speak with our specialist team please do not hesitate to contact us.