Legacies Roundup | March 2018

Since the last edition of Legacies Roundup, BWB’s Legacies, Trusts & Probate Disputes team has been busy advising on various new charity legacy cases. These include a potential challenge to a statutory will under the Human Rights Act, a particularly sensitive case of an elderly and vulnerable claimant seeking to challenge a charity legacy under the Inheritance (Provision for Family and Dependants) Act 1975, and a request from a surviving spouse to restructure and delay a legacy left to charity.

Charity Legacies



In this edition of Legacies Roundup we look forward to our participation at this year’s ILM Annual Conference, examine a recent High Court decision regarding executors and legal costs, highlight the Institute of Fundraising’s recently released GDPR guidance for legacy fundraisers, and touch upon the much anticipated review of inheritance tax.


ILM Annual Conference 2018 in association with Bates Wells Braithwaite

We are delighted to be partnering with the Institute of Legacy Management (ILM) at its annual conference in May.

The conference promises to be an informative and thought-provoking experience for delegates. They will be offered practical know-how on topical issues, useful insights and real-world examples, as well as top tips to take away.

Speakers from BWB will host two sessions. The first will be a general round up covering recent legal cases, the Law Commission’s consultation on wills, and GDPR compliance for legacy professionals. The second session will focus on executors (costs and communication), legacies of real property, and the rules on refusing a legacy.

The day will also include a market update from Meg Abdy of Legacy Foresight, a session hosted by Dying Matters, and a topical panel discussion.

We hope to see many of you there.

To secure your place at the event please visit the conference website page here.


Executors and their costs

One of the issues on the agenda at the conference will be beneficiaries’ rights to information about executors’ expenses.

In the recent case of Mussell v Patience the High Court held that executors who obtain legal advice during the course of the estate administration are not required to show in the estate accounts what the fees are for, nor whether they have been reasonably incurred or are reasonable in amount.

Louise Patience left her estate to her four children. Her executors (who were her solicitor and one of her children) took out a grant of probate and administered the estate. However, prior to distribution two of Mrs Patience’s other children objected to certain legal fees incurred by the executors on the grounds that there was not enough information for them to be able to determine whether the charges made by the executors’ solicitors were reasonable.

The judge found that an executor accounting to the beneficiaries only has to show at the outset that sums recorded in the estate accounts have actually been spent, and that they have been spent in the fair execution of the estate administration. When giving details of legal fees incurred by the estate there is no requirement to detail the number of hours worked nor the hourly rate charged, nor to give a detailed breakdown of exactly what work was done. Neither is there any obligation to prove that charges made by a solicitor have been reasonably incurred, or were reasonable in amount, unless the beneficiaries provide some evidence to the contrary.

Although the judgment may be helpful to executors, as it clarifies what is required to support an entry in estate accounts, it could make it more difficult for beneficiaries – including charities – to challenge executor costs and to obtain relevant information.

At the ILM annual conference in May we will discuss the implications of the case for charity beneficiaries, including what information they should be asking for and when, and what options and remedies they have.


Legacy fundraising and GDPR – are you ready?

With only two months to go until the implementation of the General Data Protection Regulation, now is the time to make sure that your organisation is ready.

Legacy fundraisers should be prepared to respond to and proactively manage data protection related issues throughout the entire legacy fundraising and administration process. In particular, they should be aware that GDPR imposes additional requirements in relation to consent, and should have practical plans in place to manage the changes well in advance of the May deadline.

The Institute of Fundraising recently released specific guidance for legacy fundraising, and the ICO has published a helpful FAQs list for charities covering these issues.

GDPR requirements related to legacies and legacy administration will be covered by us at the ILM Annual Conference in May.


What’s next?

It’s time to review… Inheritance Tax

The Chancellor has written to the Office of Tax Simplification (OTS) requesting a review of a range of issues relating to IHT.

The review will consider various aspects of the current system including the annual threshold for gifts, small gifts and normal expenditure out of income, relevant aspects of the probate procedure, as well as estate planning. The review will also look at the current perception of complexity surrounding the IHT rules – an area that has historically proven to be challenging for both taxpayers and practitioners.

The overall aim of the review is to identify opportunities and develop recommendations for simplifying IHT, from both a tax and administrative point of view. The OTS report, due to be published in the autumn, will provide an overview of the current IHT regime, identify opportunities for simplification of the system, and recommend changes for the government to consider.

Charities are key beneficiaries of the current IHT regime, and we will keep you updated on the progress of the review in future editions.

This information is necessarily of a general nature and doesn’t constitute legal advice. This is not a substitute for formal legal advice, given in the context of full information under an engagement with Bates Wells.

All content on this page is correct as of March 26, 2018.