Minimising Will disputes – essential strategies for business owners and entrepreneurs

Claims against estates are on the rise and this can impact business succession where business assets are involved. More complex family relationships, larger estates, and a greater public awareness of how to challenge the way an estate is divided are some of the reasons for this. Claims can result in delays in getting a grant of probate, tying the hands of executors who will be unable to distribute or deal with the estate assets. For beneficiaries this can lead to unnecessary stress and financial hardship. Here are some things to keep in mind when a claim arises before probate has been granted.

Executor duty

Executors have a duty to beneficiaries to administer estates in a timely manner, but they cannot proceed when there is a claim against the estate.

Caveats

A claimant can halt the probate process by lodging a written notice (a caveat) with the Probate Registry. This allows a claimant the time to investigate and set out their claim. If no caveat is entered the possibility of pursuing a legitimate claim may be lost.

Executor neutrality

Executors must remain neutral and provide any documentation the parties need. They must also ensure that probate proceeds efficiently. Failure to do so could be a breach of their duties and create a personal liability.

Getting expert legal advice

Our will dispute solicitors can help the executors comply with their duties and avoid any personal liability. We can also swiftly contest or ‘warn off’ inappropriate caveats. When beneficiaries grow frustrated by unjustifiable delays, we can take steps to ensure that probate is granted as soon as possible.

Top Tip

Claims against estates that delay the distribution of assets can arise in many ways. For executors and beneficiaries there are clear legal mechanisms to minimise this threat. Careful estate planning is essential for business owners and entrepreneurs so that they minimise the risks of dispute arising impacting the business. For claimants a robust case must be set out within a set timeframe. To protect all parties, seeking expert legal advice at an early stage is essential.

An already difficult time can be made more challenging when it turns out someone is not entitled to anything under the terms of the will or the intestacy rules. Claims may be made by family members, people who were financially supported by the deceased and others. Any claim is likely to delay the administration of the estate. Here are some things to bear in mind.

Grounds for claim

Despite not being automatically entitled under a will or intestacy, someone may be able to bring a claim to rightfully reclaim inheritance that should have been theirs. This could be done under the Inheritance (Provision for Family and Dependants) 1975 Act, by proprietary estoppel if they were promised an inheritance by the deceased or under a constrictive or resulting trust if they have contributed to a property or other asset that forms part of the estate.

Time limits

There are certain timescales in making such claims which must be complied with so obtaining specialist legal advice as soon as possible is essential. A delay may mean the chance to bring a claim is lost.

Advice

We can assess and advise on the prospects of successfully bringing a claim and ensure that all steps are taken within the requisite timeframe to ensure your interests are protected.

Top Tip

If you have a legitimate claim against an estate, act quickly and set out the details of your case without delay. Expert legal guidance safeguards your position and reduces the risk that you lose your right to pursue the claim. Again, careful estate planning is essential for those that are worried there may be claim against their estate to minimise the risks of dispute arising.

A Will is the most important tool in insuring that an estate is dealt with as per the testator’s wishes and is the only way that legally binding instructions can be left regarding the administration estate. However, it is only worth drafting a Will if it is valid and achieves the outcome anticipated by its drafting.

Wills can be declared invalid for a number of reasons, including that they were made under undue influence, they were not properly witnessed, or the testator wasn’t able to understand the contents. If a Will is invalid, the way the estate is divided will usually change quite significantly. This may mean that your assets could fall into the wrong hands. Depending on the type of asset, this can cause significant issues and further disputes, for example, shares passing to someone who is not involved in the business or who has issues with those running the day-to-day operations.

Below we consider some of the factors relevant to challenging the validity of a Will.

Vulnerable testators

We currently have an ageing population and are more aware of conditions concerning mental capacity such as dementia which may affect the ability to make Wills. Furthermore, older testators are more vulnerable and therefore more susceptible to influence and fraud, leading to an increase in claims of this nature.

Effect of invalidity

If a successful challenge is brought, the estate will be administered according to the last valid Will. If there is no Will the intestacy rules (a statutory framework of those entitled) apply which may be more favourable to the claimant.

Act quickly

If there are concerns as to the validity of the Will, steps need to be taken quickly to protect the estate assets and to avoid the estate being distributed before the claim is resolved, including the entering of a caveat. A failure to do so can lead to a loss of assets.

Assess claim

It can be difficult to obtain the information required to consider whether the Will is valid. We can help our clients through those initial steps before assessing and advising on the prospects of successfully bringing a claim.

Top Tip

It is important to ensure that you obtain proper and professional legal advice when drafting your will to ensure that it is valid and achieves the outcomes you desire. Wills are only declared invalid in clearly defined circumstances. Before starting a claim it’s essential to do the groundwork and speak to a solicitor early to establish whether your case is strong enough to justify the risk of a costly litigation process.

Inappropriate behaviour by those tasked with the responsibility for administering the estate and any related trusts leads to delay and can have personal repercussions for individual executors and trustees.

Duty to provide information

Beneficiaries and co-executors or trustees are entitled to certain information about the estate and any trusts. Executors must act within their powers.

Executor fraud

It may be that the executor or trustee has previously acted in a way that makes them unsuitable for the role. For example, if they have previously taken money from the deceased or another estate or if they have been convicted of fraud, their position may be challenged.

Personal liability

Executors or trustees failing to work with their co-executors or trustees or within their powers may be in breach of their duties. This creates a personal liability. Resolving issues like this and potentially removing the executor or trustee from their position could in turn lead to complications or delays with the administration of the estate and any related trust.

Advice

We can advise the executor, trustee or the beneficiary on their position to ensure all co-executors or co-trustees comply with their duties. We can remove executors or trustees from their roles if necessary. This will facilitate the efficient estate or trust administration.

Top Tip

Inappropriate behaviour by executors and trustees can leave beneficiaries and others in a state of prolonged uncertainty. Proper scrutiny of those handling the estate administration is essential. Take quick action if you have concerns and speak to a will dispute solicitor for legal advice. 

Executors (and administrators where there is no Will) must investigate circumstances surrounding alleged lifetime financial abuse of the testator and any misappropriation of assets occurring before or after death. They must also seek to recover any such property. Below we highlight the implications of missing estate assets.

Financial mismanagement

The cost-of-living crisis mixed with a more vulnerable ageing population has led to an increase in claims of financial mismanagement during an individual’s life. We have also seen an increase in challenges to lifetime gifts made by the deceased.

Beneficiaries lose out

Missing assets reduce the size of the estate. This places some beneficiaries at a disadvantage. An executor has a duty to recover all assets of the deceased and to recover those taken incorrectly for the benefit of the beneficiaries.

Legal action

We can assist in obtaining proof of financial mismanagement or invalid lifetime gifts and to recover those assets lost or misappropriated during the life of the deceased. Recouping valuable assets increases the estate for legitimate beneficiaries and protects executors from any liability arising from potential claims.

Top Tip

Always consider proportionate action to recover assets that have been taken from an estate. Successful legal action increases the amount of wealth available for distribution to beneficiaries, redresses a wrong done to the deceased and ensures that executors fulfil the legal duties of their role.

Mistakes in the Will can lead to the testator’s final wishes being frustrated, and disappointment for genuine beneficiaries. Rectification of errors is possible, but the process can lead to delay and introduce an element of uncertainty to the probate process.

Drafting process

Errors sometimes occur in the Will drafting process. The document may have been incorrectly executed, a typographical error might be included, the terms as drafted may be inconsistent or the Will drafter simply may not have understood the testator’s instructions.

Rectification

An error created by an administrative or clerical error may be rectified by the Court. Our will dispute solicitors can advise on the likelihood of the Court rectifying the issue and make the necessary application to allow the administration of the estate to proceed correctly.

Negligence claims

If a rectification application is not possible, then we can seek the necessary evidence and advise on the merits of successfully bringing a claim against the Will drafter for negligence. Sometimes we can obtain compensation for the losses sustained by the disappointed beneficiaries before instigating the claim.

Top Tip

A careful examination of the Will is essential where mistakes in the drafting are suspected. Ask for a copy of the Will from the executor. If your request is refused ensure you check the Will once probate is granted and the will becomes public. Take appropriate action as soon as possible to avoid the estate being dealt with under the terms of the defective Will by getting expert legal advice.