Probate not applied for

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  • #47607
    Jo Gregory
    Participant

    We have a case where the partner's mother passed away 8 years ago.

    Probate has never been applied for, land registry still shows the late mother as the owner. 

    The claimant and partner are renting the property out but claim to be passing the rent to the partners son. We are unable to obtain evidence of who actually owns the property. 

    They are stating that they have no idea who the beneficiarys of the late mother are. 

    Where do we stand with counting the capital value of this property?  We believe that the partner is a beneficiary, but cannot prove this?

    It does not seem right to ignore the capital value, as the partner possibly did not apply for probate due to claiming benefit.

    Please help

    #134022
    John Boxall
    Participant

    Try Reg 49 HB Regs 2006

    1) A claimant shall be treated as possessing capital of which he has deprived himself for the purpose of securing entitlement to housing benefit or increasing the amount of that benefit except to the extent that that capital is reduced in accordance with regulation 50 (diminishing notional capital rule).
    (2) Except in the case of—……………
    any capital which would become available to the claimant upon application being made, but which has not been acquired by him, shall be treated as possessed by him but only from the date on which it could be expected to be acquired were an application made.

    Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery. The blossom is blighted, the leaf is withered, the god of day goes down upon the dreary scene, and—and in short you are for ever floored.

    Wilkins Micawber, Ch12 David Copperfield

    #134028
    jamcon
    Participant

    Depending on the facts of the case, CIS 1189 03 may be of help. I’ve copied the decision below:-

    PLH Commissioner’s File: CIS 1189/03

    SOCIAL SECURITY ACTS 1992- 1998

    APPEAL FROM DECISION OF APPEAL TRIBUNAL
    ON A QUESTION OF LAW

    DECISION OF THE SOCIAL SECURITY COMMISSIONER

    Claim for: Income Support
    Appeal Tribunal: Sheffield
    Tribunal Case Ref: U/01/138/2002/03601
    Tribunal date: 14 January 2003
    Reasons issued: 6 February 2003

    1. This claimant’s appeal is dismissed, as in my judgment there was no material error of law in the decision of the appeal tribunal chairman sitting alone at Sheffield on 14 January 2003, when he confirmed the decision given on behalf of the Secretary of State on 14 August 2002 that the claimant was not entitled to income support from the date of the further claim she made on 8 May 2002, on the ground that she possessed capital in excess of the prescribed limit of £8,000 for income support purposes.
    2. According to the facts found by the tribunal the claimant, a lady now aged 43, first claimed income support in February 2002 after her marriage had come to grief and her husband had left the family home, where she continued living with the 3 children. That property is worth between £40,000 and £50,000 and is free of mortgage, but its value is disregarded as capital for income support purposes under regulation 46(2) and schedule 10 paragraph 1, Income Support (General) Regulations 1987 SI No 1967. However as she quite properly disclosed she had also been left another property, 3 Seaton Close, as the sole beneficiary under the will of her mother who had died in 1995. That property was her mother’s house, a former council house acquired under the right-to-buy provisions which would have required repayment of part of the discount had the property been sold within two years of the mother’s death. Although the mere act of obtaining probate would not have had this effect, in fact the claimant and her husband who was her co-executor under the will had simply left the estate unadministered, except that some months after her mother’s death she had let the property using the rent she received on it to pay off the outstanding mortgage. Its undisputed value at the material times in 2002 was not less than £15,000, and the amount outstanding on the mortgage £4,000.
    3. Because of the value of this property the claim for income support made in February 2002 was either rejected, or not proceeded with, after an officer of the department had visited the claimant and taken a statement from her in which she promised to provide verification of the probate position on her mother’s estate (page 3). It appears the visiting officer may have given some (entirely proper) advice at that stage that an income support claim would have a better chance of success once she was able to show some reasonable steps towards obtaining probate and disposing of her mother’s property, since its value as a capital asset might then qualify to be disregarded, e.g. under paragraph 26 of schedule 10 to the regulations: see the note about the previous claim in paragraph 6 of the decision dated 14 August 2002 on the later one (page 24), which was the decision under appeal to the tribunal.
    4. On the later claim to which that decision related, the claimant had duly disclosed 3 Seaton Close in answer to the question about property she owned, adding “Still in Probate not quite owned yet”: page 9. In answer to further departmental enquiries she disclosed her mother’s will (pages 15-17) which appointed the claimant and her husband executors and left the whole estate subject to the usual trusts for sale and conversion to the claimant absolutely if, as happened, she survived her mother. She said she was taking steps to dispose of the property, in that “I have applied for probate but cannot afford the fee at the moment”. She was not intending to live in the property herself but was hoping to sign it over in connection with divorce proceedings.
    5. In fact, as subsequently transpired, she had not applied for probate herself and never did; but her husband agreed to and did so at his own expense under an arrangement between the two of them that he would take over the mother’s house as part of a property settlement in the pending divorce proceedings, she retaining the matrimonial home. There is no reason to doubt that this proposal was a perfectly genuine and sensible one agreed between the two of them but it necessarily remained subject to the divorce proceedings going through before it could become a binding arrangement, (apart from anything else there were children involved); so there could be no question of its affecting the value of capital in the claimant’s hands for income support purposes at the date of her claim on 8 May 2002 or that of the departmental decision rejecting it on 14 August.
    6. The decision of 14 August 2002 rejecting her second claim (page 24) was given on the ground that the claimant was entitled under her mother’s will to the entire beneficial interest in the property; her failure over a considerable period of time to take steps to have the estate administered and the property or its proceeds distributed to her did not detract from the fact that she could have done so whenever she wished. Thus she had in the words of the decision “a beneficial interest” and “capital that is available upon application”. Her objection that she could not afford the probate fee to unlock it was rejected on the ground that she could have easily obtained a loan for this comparatively small amount (£130) in order to do so; in view of the advice given to her on the previous claim about the steps she should take, sufficient time had now passed for her to have acquired her capital. This the decision valued at £9,500 (taking the property itself at £15,000 and subtracting 10% for realisation expenses and £4,000 for the mortgage) with the result that as the claimant’s capital for income support purposes was greater than £8,000, she did not qualify for benefit.
    7. The tribunal chairman on 14 January 2003 confirmed the decision that she was not entitled to income support by reason of having capital in excess of £8,000, but on the more direct ground that her interest under her late mother’s will amounted to actual capital she had possessed at all material times, the question of perfecting her title to the property being no more than a formality in the circumstances.
    8. Having correctly recorded that the property was still currently involved in matrimonial proceedings but that this was not relevant to the claim to income support, his statement of reasons issued to the parties on 6 February 2003 (pages 61-62) explains the factual and legal position clearly and simply as follows:
    “[The claimant] was without doubt beneficially entitled to the property and had been since the date of her mother’s death. She could have perfected the title had she wished to.
    At the hearing the appellant’s evidence was to the effect that the sole reason why a grant had not been obtained was because the parties could not raise the fee of £130. Bearing in mind the capital value of the house and the value of the mortgage-free jointly owned house this was not accepted as a valid excuse. It would have been easy if the appellant had wished to raise such a comparatively small sum. The appellant had a beneficial interest from the date of death and could have perfected the title had she seriously wished to do so. It was thus clear that she possessed capital over the prescribed limit of £8,000.
    It further appeared that up to the date of the decision maker’s decision the appellant had taken no reasonable steps at all to dispose of her interest in the property. On the contrary from her actions with regard to the property the appellant had made a conscious election not to dispose of the property. Any activity after the date of the decision maker’s decision was irrelevant so far as the tribunal was concerned.
    In all the circumstances the decision maker had correctly applied the legislation and his decision must be confirmed.”
    9. Against that decision the claimant appeals with the leave of the tribunal chairman, on the grounds set out on her behalf at pages 56 to 57 and further observations in reply at page 70 by the advice worker who is acting as her representative. These are in particular that the decision was unreasonable in failing to take account of the practical difficulties and time involved in obtaining a grant of probate, especially in the claimant’s particular circumstances as explained to the tribunal, which were that she was in a distressed and confused state and anxious about her family’s future following the separation from her husband, making it unreasonable to assume that it would have been practical for her to apply for and obtain her capital simply or quickly. That ought to have been taken into account both on the question of whether her capital was “available on application” under regulation 51(2) to which the departmental decision had referred, and also under paragraph 26 of schedule 10 in determining what steps were reasonable for her to have taken to dispose of the premises.
    10. The Secretary of State supports the appeal in a submission by Mr J Tattersall on his behalf dated 22 May 2003 at pages 65-67, but only on the fairly narrow legal ground that insofar as the tribunal’s decision upheld the original reference in the decision of 14 August 2002 to “capital available on application” that was strictly incorrect, as what the claimant had at all material times was an actual capital asset in the form of the interest in her late mother’s estate: thus it was not necessary to have recourse to the “notional capital” provisions with which regulation 51 is concerned. However despite that legal defect in the reasoning, it is submitted, the actual decision is the only possible one that could have been reached and a confirmatory one should therefore be issued to the same practical effect; since whether viewed as actual or notional capital what the claimant possessed was clearly worth more than the £8,000 limit, and in the Secretary of State’s submission none of the provisions for disregarding capital value under schedule 10 to the 1987 regulations applies.
    11. I am not satisfied that the tribunal did fall into any material error of law as to the nature of the capital asset the claimant possessed. The chairman was I think justified in the findings clearly recorded in the statement of reasons quoted above, that the claimant was “without doubt” beneficially entitled to the property from the date of her mother’s death subject only to the formalities needed to perfect her title, which she could have carried out at any time had she wished; thus having for all practical purposes, certainly those of chapter VI of the Income Support (General) Regulations, an entitlement in respect of the property equivalent to full beneficial ownership. The confirmation of the Secretary of State’s decision was thus in my view rightly based on the reference on page 24 to the claimant having a beneficial interest in the property and the calculation of value under regulation 49 using the current market value of the property less 10% for realisation expenses, rather than on the additional reference to notional capital available on application which also appears in the Secretary of State’s decision but is I think better viewed as an alternative way of getting to the same result. In my judgment it is clear that the tribunal adopted the “actual capital” line of reasoning rather than the alternative, and in that I think it was correct; though I agree with the Secretary of State’s submission that on these facts it actually makes no difference to the practical outcome of the case which legal analysis is adopted.
    12. For completeness, I confirm that the fact that the estate had remained unadministered for several years, so that the claimant had not actually had the property vested in her at the time of her income support claims or the Secretary of State’s decision, does not prevent her rights in respect of it being counted as actual capital assets for income support purposes, closely equivalent to absolute beneficial ownership. In strict legal analysis, under this particular will her rights were as sole residuary beneficiary of the entire estate, rather than a specific devisee of the property itself as in the case of R(IS) 1/01 Wilkinson v CAO to which I was referred, so it is paragraph 28 rather than paragraph 27 of my decision in that case that applies here: but the practical difference in terms of capital value on such facts as these is negligible.
    13. That leaves the subsidiary arguments of the claimant’s representative based on the emotional and other difficulties being suffered by the claimant at the time, and the effect of these on her ability to get in and realise the value of her capital. Even if I had been the tribunal hearing the evidence I am not sure I would have been persuaded that a lady making repeated attempts to obtain income support, answering questions about this without apparent difficulty, and at the same time instructing solicitors in connection with divorce proceedings and a property settlement to be made in her favour, could not reasonably have been expected to take any steps at all, even to start dealing with her mother’s estate or the property, some seven years or so after her mother had died. On the contrary it seems to me the chairman’s assessment of a conscious election on her part not to do so is likely to be far nearer the truth of the matter; certainly a justified conclusion of fact on the material before him. But however that may be, such considerations are simply irrelevant to the valuation of actual capital under regulation 49 which prescribes that this must be by current market value, less the 10% allowance for expenses which in this case would include the probate and other legal formalities necessary to perfect the title and complete a sale. I do not therefore agree with the claimant’s representative that there was any error of law by the tribunal in omitting to refer to her emotional or personal difficulties in determining the capital she possessed, or its value for income support.
    14. For the sake of completeness, my answer would be no different had “notional capital” under regulation 51(2) been in point, since here again there is a simple question of identifying what capital would become available to the claimant upon an application for it being made, without any allowance or adjustment in the regulation for a particular claimant’s reluctance for any reason to make it.
    15. Finally I confirm that in my judgment the tribunal chairman was right in holding that the provision in paragraph 26 of schedule 10 for disregarding the value of premises where the claimant is taking reasonable steps to dispose of them did not apply here. On his findings, the claimant had actually taken no steps at all to dispose of the property by the time of her claim on 8 May 2002, or the Secretary of State’s decision on it of 14 August 2002; any later activity being as the tribunal chairman rightly recorded excluded from consideration under section 12(8)(b) Social Security Act 1998. At all events, his finding of fact that she had taken no reasonable steps in that direction by the date of the Secretary of State’s decision is an unassailable one on the material before him; and without something that can be identified as a reasonable step and an identified date on which it was taken, there can be no question of paragraph 26 applying to exclude the capital value from the income support reckoning.
    16. As in accordance with the tribunal’s findings the claimant was rightly held to have actual capital equivalent to full beneficial ownership in her late mother’s house (which was of course, as the Secretary of State’s submission points out, in her possession at all material times after her mother’s death) and none of the provisions for disregarding its capital value has been shown to apply on the facts, the tribunal chairman reached the right conclusion in this case for the reasons he gave. I accordingly dismiss this appeal.
    17. (Signed)

    P L Howell
    Commissioner
    21 July 2003

    #134029
    John Boxall
    Participant

    Thanks Jamcon, that decision is a cracker

    Perhaps it should be put into the caselaw section?

    Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery. The blossom is blighted, the leaf is withered, the god of day goes down upon the dreary scene, and—and in short you are for ever floored.

    Wilkins Micawber, Ch12 David Copperfield

    #286958
    pbirks
    Participant

    ****BUMP! *****

    I have a similar case – clmts died died Novemeber 2019 and probate still not applied for…..

    Claimt claiming HB atr address A

    We were advised by our ctax depat that clmt was now responsible for Ctax at property B as his dad had died and they had requested details of date of death/ probate etc and would let us know
    Themn nothing happened for ages –
    we eventually terminated HB back to the end of the week dad died as had drawn adverse inference that our clamts share of value of house would be £16k + (The property is in London, an the property next door sold for £640k in 2020)

    Customer has appealed the over payment saying he thinks we should only take it into account from date he started renting it out, (about 18 months after his dad died, he got the EPC certs and had re wiring etc done to get it renting out standards)
    Our argument is that if he can afford the costs of doing that, he could have afforded to apply for probate.

    Im not sure how long it would be reasonable to think probate would take – as reg 46 states we can take the value into account but only from the date on which it could be expected to be acquired were an application made.

    Im aware we can draw the adverse inference, but wondering whether we might come unstuck because we’ve applied from as soon as dad died. – Any pointers or advise please?

    Also – out ctax docs are not on the same doc imaging system as benefits – if ctax send me copies of correspondence relating the the property from date of dads death, can I legitimately include that in the HB appeal against the overpayment?
    Thanks

    #286962
    John Boxall
    Participant

    AFAIK if you are the sole beneficiary, from reading the case provided above, at the point where the testator dies the property is yours

    See Para 8

    The appellant had a beneficial interest from the date of death and could have perfected the title had she seriously wished to do so. It was thus clear that she possessed capital over the prescribed limit of £8,000.

    Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery. The blossom is blighted, the leaf is withered, the god of day goes down upon the dreary scene, and—and in short you are for ever floored.

    Wilkins Micawber, Ch12 David Copperfield

    #286965
    pbirks
    Participant

    That’ll do nicely!! Thank you!
    The clmt hasn’t provided any details of the will, nor any details if who else may have an interest in the property – initally, he said the will left it to him and other relatives, then said there was no will etc so, in the absence of any information/ evidence to the contrary, we have drawn the adverse inference that he is the sole beneficiary of this fathers estate.

    #286966
    peterdelamothe
    Keymaster

    I have just applied for letters of administration (LOA) for my wife’s elderly mother who has passed away. This is equivalent to probate where there is no will.

    She was given three days to live in hospital but came home and managed 9 months. She just decided she wanted to live a bit longer. A determined woman. She deliberately left no will.

    A learning experience I must say. With a will it is fairly straight forward. Without a will it becomes a lot more complex. The law then decides who gets a share in the estate and not the deceased. So any verbal promises previously made are ignored and the rules of intestacy make no provision for unmarried partners.

    Applying for LOA takes time. Up to 6 months….the waiting time for the Government to confirm this is now up to 4 months.

    So with a will I think it is fair to rely on the details set out in that document but without a will no-one will be entitled to anything for 6 months and most solicitors will recommend any payment is NOT made for one year….in case of an unknown debt or debts.

    One other interesting point whether there is a will or not. The next of kin always tend to presume the property has no debt on it if they know the mortgage is small or has been paid off. But large numbers of people are taking out equity release and similar on their property. They don’t mention this to family….why should they? The first time next of kin get to find out is often when the solicitor dealing with the will breaks the news.

    So you cannot just presume the value of an estate. Sometimes….even with property….there is not much left when everything has been paid off.

    #286969
    pbirks
    Participant

    well, we asked for the information and he hasnt provided it, even after getting an overpayment letter advisinfg if he provided details of will/ probate/ valueof property/ any debts secured on it we’d reconsider/ apply unent etc – nothing
    The proerty is still being remnted out with him named as the landlord – £1950 a month on the most recent tenancy – – so i think an adverse inference that, in the absnse of any other info, he is the sole beneficiarie and that , even if he isnt the sole beneficiary, his share is worth £16k+
    Land registry doesnt show any charges on the property which O think it would do if any equity release had been agreed. Property is still i dads name almost 5 years after his death…..

    #286983
    John Boxall
    Participant

    well, we asked for the information and he hasnt provided it, even after getting an overpayment letter advisinfg if he provided details of will/ probate/ valueof property/ any debts secured on it we’d reconsider/ apply unent etc – nothing

    The proerty is still being remnted out with him named as the landlord – £1950 a month on the most recent tenancy – – so i think an adverse inference that, in the absnse of any other info, he is the sole beneficiarie and that , even if he isnt the sole beneficiary, his share is worth £16k+

    Land registry doesnt show any charges on the property which O think it would do if any equity release had been agreed. Property is still i dads name almost 5 years after his death…..

    I do wonder if this should be referred either directly or via SFIS to HMRC?

    Firstly there may well be a Inheritance Tax Liability on the estate which clearly hasnt been declared and secondly there is the question of the income from letting.

    Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery. The blossom is blighted, the leaf is withered, the god of day goes down upon the dreary scene, and—and in short you are for ever floored.

    Wilkins Micawber, Ch12 David Copperfield

    #286989
    peterdelamothe
    Keymaster

    I think you could refuse “in the alternative” on both issue pbirks. It is up to the claimant to explain/supply the information.

    My post was aimed more at others than your specific case as hbinfo gets lots of queries about this subject. In general folk find this subject difficult but we are all going there one day!

    #286990
    John Boxall
    Participant

    Seriously in my view at least nothing beats a comprehensive ‘In The Alternative’ decision letter

    Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery. The blossom is blighted, the leaf is withered, the god of day goes down upon the dreary scene, and—and in short you are for ever floored.

    Wilkins Micawber, Ch12 David Copperfield

    #286995
    pbirks
    Participant

    so what would the in the alternative be for me with this claim?
    1) adverse inference cos we think you have £800k worth of house you inherited from you late dad ( bought on a right to buy for less 10% of its current value… and bought for less than the current HB overpayment he is appealing against!!!! ) cos you havent provided the info we asked for –
    would 2in the alternative be
    2) depravation? because hes found the money to get energy certs. get flat rewired/ “complete refurbished throughout so it can be rented for a market rent” (his words) but he hasn’t applied for probate which would make him a legal owner of the property

    I want this to be as water tight a possible so any suggestions/pointers of what in the alternative i could use would be gratefully received!
    Thanks – Prisca

    #287013
    John Boxall
    Participant

    so what would the in the alternative be for me with this claim?

    1) adverse inference cos we think you have £800k worth of house you inherited from you late dad ( bought on a right to buy for less 10% of its current value… and bought for less than the current HB overpayment he is appealing against!!!! ) cos you havent provided the info we asked for –

    would 2in the alternative be

    2) depravation? because hes found the money to get energy certs. get flat rewired/ “complete refurbished throughout so it can be rented for a market rent” (his words) but he hasn’t applied for probate which would make him a legal owner of the property

    I want this to be as water tight a possible so any suggestions/pointers of what in the alternative i could use would be gratefully received!

    Thanks – Prisca

    If you assume that somehow its not your claimants capital, my suggestion might be that he’s receiving income in the form of the rent from the property

    BUT I will make the point again, inform HMRC as there are a number of issues involving tax, and potentially beneficiaries of his fathers will/intestacy that may have been denied money that is rightfully theirs

    Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery. The blossom is blighted, the leaf is withered, the god of day goes down upon the dreary scene, and—and in short you are for ever floored.

    Wilkins Micawber, Ch12 David Copperfield

    #287014
    John Boxall
    Participant

    Thinking about it in the absence of evidence that his late fathers will/intestacy has been properly administered there could be other funds that the claimant has appropriated that have not been declared.

    I suggest that this is the killer

    Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery. The blossom is blighted, the leaf is withered, the god of day goes down upon the dreary scene, and—and in short you are for ever floored.

    Wilkins Micawber, Ch12 David Copperfield

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