How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask Joshua Your Own Question

Joshua
Joshua, Lawyer
Category: Law
Satisfied Customers: 25358
Experience:  LL.B (Hons), Higher Prof. Dip. Law & Practice
35043042
Type Your Law Question Here...
Joshua is online now

A friend who was very ill strokes and dementia was getting

Customer Question

A friend who was very ill strokes and dementia was getting the higher rate pension credit to top up his pension to help with care. unfortunately he had a small investment £25,000 which he left to me this went straight into my bank account and out of it I paid off all his outstanding debts. I was sole beneficiary. He had no other money or property or assets. The Department of working Pensions are now claiming he owes them money presumably because he didn't declare the investment. I have given them all information they require but I have had this hanging over my head since last year. The deceased passed away 07/07/2013. I want to know if there is not enough money left out of the estate what happens. My daughter was asked to be executor and has been told she is liable she hasn't any money. The deceased meant nothing to her she was only doing a good turn and didn't know importance of role and wouldn't have taken it on if she had known.
Submitted: 3 years ago.
Category: Law
Expert:  Joshua replied 3 years ago.

Joshua :

Hello and thank you for your question. I will be very pleased to assist you. I'm a practicing lawyer in England with over 10 years experience.

Joshua :

How much roughly is DWP claiming is owed to them please?

Joshua :

From what you say your daughter has formally acted as executor already?

Customer:

Hi the DWP hasn't worked it out yet. My daughter has acted as executor.

Joshua :

Thanks. Do you have any clues - i.e. whether it is likely to be hundreds or thousands for example?

Customer:

I'm assuming around 3-10 thousand. Debts I paid from the £25,000 were approx £14

Customer:

thats £14,000

Joshua :

Thanks. This is potentially a rather awkward situation which your daughter has quite innocently found herself in. Insolvent estates are very tricky to administer and if mistakes are made by an executor in administering an insolvent estate, the executor can personally liable to creditors which have lost out. For this reason, particularly where executor is not to personally benefit, the best advice is either for the executive to renounce in favour of appointing the official receiver to administer the estate alternatively for the executor to act but only on the basis that they are represented by a solicitor. However, this advice is obviously no help at this juncture coming too late to be of assistance.

Joshua :

There is a strict order of priority in which debts must be paid as follows:

Customer:

The DWP are now writing to me instead of my daughter but what I want to know if there isn't any money left from the estate can we be taken to court and thrown into prison!!

Joshua :

1. The funeral expenses. These should be reasonable and proportionate to the size of the estate. For example one cannot use £6000 of a £7000 estate on the funeral if there are also debts of several thousands of pounds. A gravestone or other permanent memorial is not considered to be part of the funeral expenses. Family members who pay for a funeral from their own money may find it difficult to recover the money later if there are other creditors.


2. Testamentary expenses.These are the expenses you incur as part of the administration of the estate. You should keep a careful record of these and keep any receipts for petrol or train journeys, postage etc. You may also want to ask for proof of posting certificates at a Post Office which are free of charge.


3. Debts to local and central government.This may be income tax, over-payment of pension or other benefits during the life of the deceased or after their death if there has been a delay notifying the Department of Work and Pensions of the death.


4. Secured creditors. These are loans secured against an asset e.g. a mortgage on a property or a loan for purchase of a car.


5. Preferred debts and Preferential debts – these are very rare and will not apply in most cases. Wages due to employees are preferential debts and this may apply where the deceased received direct payments for employing carers.


6. Ordinary creditors e.g. utility bills, bank loans, credit and store card debts.


7. Interest due on unsecured loans.


8. Deferred debts – an example would be an informal loan between family members.

Joshua :

from the above, you can see that that's payable to the Department of work and pensions have priority over most other types of creditors and accordingly, they are likely to have priority over most if not all of the debts you settled other than potentially funeral costs

Joshua :

as to where you go from here. You have no direct liability to the DWP because from what you say, you did not act as executor. The person with liability would be your daughter if she acted as executor. The insolvency act provides recourse for your daughter to require you to repay sufficient monies from the distribution she gave you in order to repay the DWP. Equally, under the same legislation, such monies as you paid to creditors can be reclaimed. however, depending upon how many individuals are involved and who they are, getting the money back physically is not always straightforward and can involve court action if the individual refuses to make repayments. In addition, calculations need to be performed to ascertain what proportion of monies must be repaid from each creditor and this can become rather complex if there are many individuals involved with different levels of debts

Joshua :

in terms of the best way forward, obviously the first thing to ascertain is the amount the DWP wish to reclaim and your daughter may wish to consider putting pressure on them to come up with a calculation. the reason being, in the probably unlikely event that the figure happens to be very small they may elect not to pursue the issue or alternatively you or your daughter may just decide to pay it and be done with it

Joshua :

however, if as you fear the figure will be much higher will need to consider reclaiming monies from creditors you have paid out to and to do this, it is necessary to have the appropriate figure to hand. Whilst you're waiting for the figure, you and your daughter may consider writing to the various creditors you paid money to notifying them that the state appears to be insolvent and accordingly made the payment is likely been made to them part or all of which may need to be reclaimed under the provisions of the insolvency act advising that you will notify further as soon as further information is to hand

Joshua :

once you have the figure from the DWP, it may be sensible to consider appointing an insolvency practitioner to advise your daughter and to carry out the appropriate calculations in respect of the various creditors that need to repay part or all of the monies paid out by you. once you have these calculations, each of the creditors can be notified and payment demanded backed up by the calculations provided to you by an insolvency practitioner. if necessary, court action may be required to claim back monies from a reluctant creditor.

Joshua :

Are you happy with the information I have provided to you above or is there anything above I can clarify for you any further?

Customer:

Thank you for your advice. As you say best to wait to see the figure and proceed from there.

Joshua, Lawyer
Category: Law
Satisfied Customers: 25358
Experience: LL.B (Hons), Higher Prof. Dip. Law & Practice
Joshua and other Law Specialists are ready to help you

What Customers are Saying:

 
 
 
  • Thank you so much for your help. Your answers were really useful and came back so quickly. Great! Maggie
< Previous | Next >
  • Thank you so much for your help. Your answers were really useful and came back so quickly. Great! Maggie
  • A quick response, a succinct and helpful answer in simple English. I believe I can now confront the counter party with confidence -- worth the 30 bucks! Rick
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C.
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP
  • I couldn't be more satisfied! This is the site I will always come to when I need a second opinion. Justin
  • Just let me say that this encounter has been entirely professional and most helpful. I liked that I could ask additional questions and get answered in a very short turn around. Esther
 
 
 

Meet The Experts:

 
 
 
  • Jo C.

    Jo C.

    Barrister

    Satisfied Customers:

    30316
    Over 5 years in practice
< Previous | Next >
  • http://ww2.justanswer.co.uk/uploads/EM/emus/2015-7-7_192327_bigstockportraitofconfidentfemale.64x64.jpg Jo C.'s Avatar

    Jo C.

    Barrister

    Satisfied Customers:

    30316
    Over 5 years in practice
  • http://ww2.justanswer.co.uk/uploads/BE/benjones/2015-12-1_0437_ennew.64x64.jpg Ben Jones's Avatar

    Ben Jones

    UK Lawyer

    Satisfied Customers:

    11553
    Qualified Solicitor - Please start your question with 'For Ben Jones'
  • http://ww2.justanswer.co.uk/uploads/BU/Buachaill/2012-5-25_211156_barrister5.64x64.jpg Buachaill's Avatar

    Buachaill

    Barrister

    Satisfied Customers:

    1754
    Barrister 17 years experience
  • http://ww2.justanswer.co.uk/uploads/JO/jojobi/2013-3-19_0265_maxlowryphoto.64x64.jpg Max Lowry's Avatar

    Max Lowry

    Advocate

    Satisfied Customers:

    894
    LLB, 10 years post qualification experience
  • http://ww2.justanswer.co.uk/uploads/UK/UKLawyer/2012-4-12_9849_F2.64x64.jpg UK_Lawyer's Avatar

    UK_Lawyer

    Solicitor

    Satisfied Customers:

    750
    I am a qualified solicitor and an expert in UK law.
  • http://ww2.justanswer.co.uk/uploads/KA/Kasare/kasare.64x64.jpg Kasare's Avatar

    Kasare

    Solicitor

    Satisfied Customers:

    402
    Solicitor, 10 yrs plus experience in civil litigation, employment and family law
  • http://ww2.justanswer.co.uk/uploads/OS/osh/2015-7-7_19268_gettyimagesb.64x64.jpg Joshua's Avatar

    Joshua

    Lawyer

    Satisfied Customers:

    8199
    LL.B (Hons), Higher Prof. Dip. Law & Practice