A messy business

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I was just discussing with @DaddyEvil the necessity for a will. I know plenty of people who don’t have one and say ‘Oh that’s fine, because everything will go to my next-of-kin anyway’. One of those people was my friend, let’s call him Arthur. Arthur had one brother, let’s call him Zach. His other living relative was his father, his mother having died when he was young. The father now had a live-in partner (we’ll call her Paula), but they were not married. Zach was married with a young son, we’ll call him Xavi. Unfortunately Zach developed a degenerative disease and died a couple of years ago. Then Arthur and Zach’s father died a few months ago. He didn’t make a will either - he told his sons he would let them fight over whatever he had. Since he wasn’t married, this meant his partner Paula was not entitled to anything from the estate. So under the UK rules of intestacy, since the father had two children, the estate should be shared equally. But since one pre-deceased him, that share passes to his children, in this case his son Xavi. Arthur is the only adult beneficiary (also the only one in this country) so he becomes the executor. Now if the estate consisted only of cash, the situation would be fairly straightforward. But of course it didn’t - there was a house where Arthur’s father lived with his partner Paula (but which was owned solely by him), and another house which was rented out. They are of similar value at present. The simplest answer would be to sell both properties and share out the cash. That would mean evicting the tenants and Paula. But then there is the added complication that Arthur gets on quite well with Paula and didn’t want to just turn her out of her home and leave her on the streets. So he thought he could have the rental property as his share, and Xavi could have the father’s home as his share, which would be held in trust until he reaches adulthood. In the meantime Paula could be allowed to continue living there. Arthur would have to be one of the trustees, and Xavi’s mother could be another. But then there is another problem - the trustees have a duty to get the best value from the assets they hold on behalf of a beneficiary. So Xavi could later sue them if he believed they hadn’t done this on his behalf - and allowing Paula to live in the house rent free is of course not the best return on the asset. So to meet this obligation Arthur would have to at least charge Paula rent at market rates, which she cannot afford. So the alternative would be to sell the rental property, have those proceeds held in trust for Xavi (for which he would have to make arrangements as a trustee), and keep his father’s home himself, allowing Paula to live there rent free. But then he would also have to maintain the property and cover all those bills to provide a home for a woman who isn’t related to him at all. And things could get really messy if Paula, in due course, met a new partner who came to live with her - Arthur could end up paying for them all to live for free in his house! Of course if Arthur’s father had made a will, giving the home to his partner or perhaps leaving it to her for her lifetime, all of this could have been avoided. Needless to say, Arthur is now keen to make a will, even though (or perhaps because) he has no children, and no longer has living parents or siblings. Even death can be a complicated business. All rights reserved. © Text and image copyright Fleur 2021.