The recent case of Kenig v Thomson Snell & Passmore LLP as detailed in the Law Gazette further highlights the need for Solicitors to communicate with the Residuary Beneficiaries of an estate at the outset of the matter, to manage their expectations, and to assist in minimising the contact that they make with the firm.
The Kenig v Thomson Snell & Passmore LLP case highlights that although the clients in an estate matter are the Executors, the Beneficiaries to the estate can bring actions against the Solicitors regarding the costs of the administration of the estate.
What is a Residuary Beneficiary?
A residuary beneficiary is a beneficiary of an Estate who has been named as a beneficiary in a deceased's Will and who will inherit (be a legal recipient) of all assets of an Estate that have not been specifically accounted for. A residuary beneficiary will inherit whatever is left from an estate after all debts, expenses and fees have been paid and all other inheritance gifts have been made.
How are probate fees usually estimated and communicated?
The cost of an Estate administration is always difficult to estimate at the outset of a matter, no two estates are the same, the clients and beneficiaries will all have different approaches to the estate administration that can impact on the solicitor’s time, but at the outset of a matter the solicitors should estimate the expected time that it should take to administer the estate. Commonly, circumstances arise that can increase the costs to the estate administration and further cost estimates must be detailed to the Executor clients throughout.
In the Kenig v Thomson Snell & Passmore LLP case there was a dramatic increase in the estimated costs, some of which the instructed solicitors attributed to the communications with the beneficiaries. This is not an uncommon occurrence.
What will change after the Kenig case?
The Kenig v Thomson Snell & Passmore LLP case will likely instigate a change across the industry to ensure cost estimates are provided not only to the executor client but to the residuary beneficiaries as well.
What is an Executor Client?
Typically in estate administration the client of the Solicitor is the Executor of the Will. It is commonly the Executor(s) whom the Solicitors will take instruction from and will have dialogue with during the administration of the Estate.
What is our approach to estimating costs at Thornton Jones?
At Thornton Jones we understand that it is important to ensure that there is communication with the residuary beneficiaries at the outset of the matter. Within that communication we will detail their share in the estate, we will identify information that the beneficiaries should share with the executors to assist them in their role as executors, we will obtain all the information from the residuary beneficiaries that we will need to distribute the estate and we will advise them of the cost estimate that has been agreed by the Executors to the estate.
Keeping the residuary beneficiaries informed throughout the administration is a conversation that we have with our executor clients at the outset, to minimise costs it may be agreed that the executor will keep the residuary beneficiaries informed and only at key points of the administration will there be communication from us. Within our communication with the residuary beneficiaries however we do give them an option for more frequent communication and if they prefer this option, we present this information to our executor clients to consider and an adjustment to the costs estimate will be made. Key stages to the administration will include a cost estimate update.
Having these discussions with our clients helps to mitigate the risk of any upset throughout the estate administration process. Ultimately, the executors are the client of the solicitor’s firm but the residuary beneficiaries are undoubtedly impacted by the costs of the estate and therefore keeping them informed is a sensible approach.
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About the Author
Lynsey joined Thornton Jones Solicitors in October 2023 as a Senior Associate Solicitor in our busy Private Client team.
Having many years of experience, Lynsey opened her own boutique law firm in 2013 specialising in private client matters and after six years of successful practice the business merged with another like-minded firm offering a wider range of legal services.
Lynsey is passionate about client care and providing an excellent service to her clients. With a fantastic reputation in her area of work, she has been recommended as a Legal 500 solicitor for multiple years and Lynsey collaborates with both West and North Yorkshire Police Federations to provide legal advice to serving and retired officers.
When she isn’t working Lynsey spends her time with her husband two girls.
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