It is fair to say that, as solicitors dealing with bereaved clients, it is not uncommon for us to be asked about the estate ‘winding-up’ process and, in particular, obtaining Confirmation. Often, clients tell us they have had no prior involvement with this, and they look to us to guide them through this sensitive process. To do this, we find it helpful to break the process down into important ‘milestones’ so, instead of being bombarded with the overall process, clients can view each milestone of the process separately with the completion of one milestone leading on to the next, and so on.
Milestone 1: Investigation
The first milestone is best described as ‘investigation’. At the outset there are various tasks to be completed, the first and most important being to identify the whereabouts/existence of a Will. In cases where there is no Will, a petition to appoint an Executor (often a close family member) will be required.
This milestone requires us to make enquiries, on behalf of the Executor, as to the extent of the deceased person’s estate. In practical terms, this means that we will look to the Executor to assist us by providing any paperwork relating to the deceased’s assets, for example bank statements, investments, premium bonds etc. From this information, we write to each asset holder (banks, insurance companies, building societies, etc.) requesting specific detail as to the balance/value of that particular asset as at the date of death. Likewise, where the deceased owned their home, a valuation of the property is also required.
Enquiries are also made if the Executor indicates the deceased may have had debts outstanding when they died.
The purpose of these enquiries is to build up an exact picture of the deceased’s estate on the date they died and, once all of the balances/values etc. are to hand, it allows us, firstly, to ascertain whether inheritance tax is payable and, secondly, to prepare the list of assets (called an “inventory”) and associated application form to submit to the Sheriff Court so that Confirmation may be granted.
Once Confirmation is granted, we can then move on to milestone 2 – ‘Exhibition and Realisation’.
Milestone 2: Exhibition & Realisation
At this point, we write back to the various asset holders, on behalf of the Executor, to show Confirmation to them. This allows the asset holder to either ‘realise’ the asset (i.e. closing a bank account, or selling shares) or, alternatively, transfer the asset (should a beneficiary have opted to have the asset transferred into their own name as part of their estate entitlement). It is also at this milestone, once Confirmation has been granted, that the Executor may begin the process of marketing the deceased’s house (if they owned one) for sale.
Once estate funds begin to be realised, we can deal with payment of any outstanding debts, for example, care home fees, overpayment of pension, etc., from the estate. Any legacies contained within the Will may also be addressed at this point.
Milestone 3: Finalisation
Lastly, once all estate debts/administration expenses are settled, and any legacies have been paid, we will prepare a detailed Executry Account to be approved by the Executor. This will detail all of the funds that have come into the estate, along with all of the funds that have been paid out. It will show the ‘net’ position of the estate which is available for distribution either in accordance with the Will or the rules of intestacy if there is no Will. Once the Executor has approved the Executry Account, the estate can be finalised and payments made to the beneficiaries.
This is simply a broad outline of the estate milestones. Each estate that we come across is different and many have factors within them that may complicate the position within any given milestone.
If you need any advice on winding-up an estate, please get in touch with Blackadders’ Executries Teams working in Aberdeen, Dundee, Edinburgh, Glasgow, Perth and across Scotland.
Zoe Milne, Trainee Paralegal
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