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Clare
Clare, Family Solicitor
Category: Family Law
Satisfied Customers: 33501
Experience:  I have been a solicitor in High Street Practise since 1985 and have specialised in Family Law for the last 10 years
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During the probate process of my wife's father, it has come

Customer Question

During the probate process of my wife's father, it has come to light that one of her siblings took out a joint life investment bond/life policy at some point in her father's later years, probably while the sibling held power of attorney. The sibling is aged in 50s and her father died aged 90. Could there be valid reasons for taking out such an investment in these circumstances?
Submitted: 2 years ago.
Category: Family Law
Expert:  Clare replied 2 years ago.
Hi
Thank you for your question.
My name is Clare
I will do my best to help you but I need some further information first.
Are you saying that she used his funds to do this
Clare
Customer: replied 2 years ago.
Yes, I believe so.
Expert:  Clare replied 2 years ago.
H
What details do you have?
Clare
Customer: replied 2 years ago.

Sorry, what further details will be helpful?

Expert:  Clare replied 2 years ago.
Hi
Of what funds were used to finance the bond
Clare
Customer: replied 2 years ago.

The funds arose when the father's house was sold when he had to move to a nursing home. Various bonds and an annuity were purchased to fund his care. There were no funds provided by the sibling.

Expert:  Clare replied 2 years ago.
Hi
What eventually happened to the money from the Bond
Clare
Customer: replied 2 years ago.

The income went only to the father. The life policy aspect was only discovered during the probate process when the insurance company were approached for the funds and said that they will only pay out, and only to the sibling, after they have proof that the probate process has completed.

Expert:  Clare replied 2 years ago.
Hi
Is the sibling seeking to receive the funds?
Clare
Customer: replied 2 years ago.
He has said he is willing to relinquish his rights, but it is so far unclear how/if this will work in practice. It seems like he will have to receive the funds, at least in the first instance.
Expert:  Clare replied 2 years ago.
Hi
Is he a beneficiary of the estate?
Clare
Customer: replied 2 years ago.
Yes there are 5 siblings as equal beneficiaries.
Expert:  Clare replied 2 years ago.
Hi
How much are they each likely to receive in total?
Clare
Customer: replied 2 years ago.
The bond is around £40k which is about half of the total 'estate' if you include it. So around £16k each.
Expert:  Clare replied 2 years ago.
Hi
Who are the executors of the Will?
Clare
Customer: replied 2 years ago.

Executors are a firm of solicitors. They have raised the question as to how/why/when the 'offending' bond was entered into, but not shared any response (if they have received one)>

Expert:  Clare replied 2 years ago.
Hi
In fairness I am aware that many Financial Advisors suggest such bonds so that money can be available for the funeral etc without waiting for Probate
Since the asset has been identified and valued the Executors will be able to deal with the distribution without any problem.
In the event that the funds are not paid over the Executors can take action to recover the balance.
I hope that this is of assistance - please ask if you need further details
Clare
Customer: replied 2 years ago.
I am a little confused. Suppose that the sibling changes his mind and does not wish to share the bond proceeds. Can he be forced to do so? Are not the proceeds legally his at present?
Expert:  Clare replied 2 years ago.
Hi
Given that the funds came from the deceased he will be holding the funds on Trust for the Estate and the Executors can sue him for the monies
Clare
Clare, Family Solicitor
Category: Family Law
Satisfied Customers: 33501
Experience: I have been a solicitor in High Street Practise since 1985 and have specialised in Family Law for the last 10 years
Clare and other Family Law Specialists are ready to help you
Customer: replied 2 years ago.

Hi Clare, in response to questioning the executor solicitors have responded as follows:

"Friends Life have confirmed that the proceeds of the joint lives policy / bond do not fall into your late father’s estate. Unless and until XXXX (sibling) confirms that he is happy for the funds to be transferred to the estate, they do not fall to be distributed with the rest of the estate.

How should we proceed given your earlier advice?

Expert:  Clare replied 2 years ago.
Hi
Do you actually know for certain yet what this sibling intends to do?
Clare
Customer: replied 2 years ago.

No. The executor only updated to say that no formal notice has (yet) been received that he will transfer the monies to the estate.

Expert:  Clare replied 2 years ago.
Hi
In that case do nothing.
If it becomes clear that the money will NOT be paid over - then you need to discuss with the executor whether or not the Estate shoudl take action on the misappropriation of the funds
Clare
Customer: replied 2 years ago.

Does the misappropriation argument hinge on whether the sibling had power of attorney at the time? We think this is the case (checking) but at the very minimum we know this occurred shortly after the father had a brain operation and had moved into a care home.

Customer: replied 2 years ago.

Clare, please would you respond to my last comment. This question seems to have been closed.

Expert:  Clare replied 2 years ago.
Hi
My apologies for the delay
Yes it does - otherwise it can be argued that it was simply a gift
Clare

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