Locating Beneficiaries - Elderly Client Adviser

Feature

posted 1 Jan 2000 in Volume 6 Issue 2

Locating Beneficiaries

In this article I wish to touch upon a few points which may help you persuade a reluctant client to focus their mind on drawing up a will. These are presented from the point of view of a professional in a different field that of probate genealogy. One of the services provided by Title Research is the identifying and locating of heirs at law under intestacy. The perspective and the insights gained from dealing on a daily basis with some of the practical problems caused by intestacy may perhaps lend weight to the message which all legal advisers endeavour to get across to their clients.

Firstly it is necessary to reiterate the importance of keeping the will up-to-date. The professional adviser should keep a database of testators who have made wills through its firm and should also send periodic reminders similar to those mailed out by dentists and opticians when a check-up is due. The purpose of review is to make sure that the provisions of the will are still applicable and to avoid the risk of accidental intestacy.

One of the most common causes of partial intestacy with which we deal is the residuary gift failing because an intended beneficiary has predeceased the testator without there being a gift over or other provision to cover this eventuality. Typically it is the case that this happens when the testator survives the writing of their will by several years without revising it and may not even be aware that the beneficiary has died in the interim.

An allied problem is that of gifts being made to individuals with whom the testator has lost touch. The writing of a will often prompts reminiscing and raises the fond memories of old friends and acquaintances former neighbours and colleagues. It will be natural to remember such persons in the will even if the testator is no longer in contact.

Wherever possible the elderly client adviser should suggest that steps are taken to locate the missing beneficiary (perhaps without contacting them) during the lifetime of the client. If for whatever reason this is not possible or desired as much information as possible should be gathered and included in a separate attachment to be held with the will to assist searches after death; otherwise the will should include a self-regulating time clause stipulating that the bequest fails if the beneficiary is not found within say one year of death in order to avoid having to seek missing beneficiary indemnity insurance cover or a Court direction. Equally the adviser should recommend that there is an explicit alternative provision to cover the possibility of the missing beneficiary having died before the testator.

Estranged family members fall within the above category. It is not at all unusual for individuals to lose contact with close kin including their own parents siblings or issue. The elderly client may regard the will as a vehicle for achieving a kind of posthumous reconciliation. Again it is incumbent upon the adviser to take down as much information as possible to assist in locating such kin after death.

It is not unusual for probate genealogists to be referred cases (particularly where there is a home made will) where a testator has left a gift to a natural child who has been given up for adoption many years ago. It should be noted that unless the adopted name of the child is known to the testator it can be a virtually impossible task to identify and locate the beneficiary and the testator may merely be storing up a problem for the executors. Elderly client advisers should tactfully counsel against any such gift unless the background information is of sufficiently high quality to ensure that an investigation to locate the adopted child stands realistic prospects of success.

The intestacy rules reflect assumptions about the intentions of a hypothetical average testator. Some elderly clients choose to die intestate content to rely on the operation of law. However there are a number of subtle ways in which the rules as they stand may not endorse what seems obvious to clients and they should be urged not to look on intestacy as a positive option.

For instance as is well known common law spouses have no statutory entitlement to benefit upon intestacy. It is necessary to make a will in their favour if the surviving partner is to be spared having to make a claim upon the grounds of say cohabitation or dependence under the Inheritance (Provision for Family and Dependants) Act 1975.

As another example in an intestacy the class of issue contains only natural and legally adopted descendants of the deceased. Step-children and foster children who from an early age may have been brought up and treated as equals within the same family are not entitled under the statutes.

Thirdly the law draws a clear distinction between whole blood and half blood kin with the former taking precedence. The rules imply that for instance those siblings sharing two parents in common are closer than those with just one and that therefore the imaginary testator would favour the former to the exclusion of the latter. However this will not necessarily be the case and as a matter of interest various jurisdictions overseas (such as Ireland and New Zealand) do not distinguish between kin of the whole and half blood. Of course a remedy may be sought and a claim made under the I(PFD) Act or a deed of family arrangement can be drawn up (with the consent and co-operation of all affected parties) to vary the strict application of the rules. However a will pre-empts such problems at an earlier stage.

The principle of representation can have an interesting effect under intestacy. In England and Wales representation applies within the five classes of issue siblings of the whole and half blood and uncles and aunts of the whole and half blood. Effectively the law rules that the issue of a potential heir at law who has predeceased the intestate steps into his or her shoes and receives their share per stirpes. At a first glance this seems fair and proper. However again it may not reflect the true feelings of the intestate and the following example may give pause for thought.

A client dies intestate without leaving a surviving spouse issue or parent. He had two siblings of the whole blood a brother and a sister. Should both the brother and the sister survive the deceased the residuary estate will be divided equally between them. This seems indisputably fair. If however the brother survives but the sister predeceases leaving four children the brother would still receive his one half share of the residue whilst the other one half would be divided equally between the late sister's four children (who would thereby receive a one eighth share each). Again it seems difficult to argue with this arrangement.

However imagine if the brother had predeceased also having had one child only: his share would then pass intact to that child. There would thus arise a situation where the deceased is survived by five nephews and nieces. However there is a very unequal distribution: one person inherits a one half share whilst the other four of identical kinship to the deceased each receive only a one eighth share. The view could be taken that the law in England & Wales here effectively penalises members of larger families and favours the only child.

In the circumstances described it is quite conceivable that the deceased might have preferred a simple per capita distribution in order that all five of the nephews and nieces might receive an equal one fifth share. Indeed in Scottish law this scenario is regarded as the more likely and the rules governing intestacy there do indeed ensure that the residue is divided in such a fashion.

Where a will is made of course the testator can exercise whatever brand of favouritism he pleases and could give preferential treatment to a particular nephew or niece for instance one who happened to be his godchild. The point is that in England and Wales a person making a will can have full testamentary freedom - complete choice and control over the distribution of his estate - rather than leaving it to the rules of intestacy to determine.

If a person dies intestate without leaving any immediate family finalising the beneficial entitlements is unlikely to be straightforward. It is necessary to research the intestate's paternal and maternal family trees. The chances of all potentially entitled persons being in contact with the intestate at the time of death would seem to be remote. Sometimes the intestate was in touch with all members on one side of the family but not the other. In any event identifying and locating the descendants of all uncles and aunts on both sides can be a sizeable task. Whilst this is good news for probate genealogists it does cause extra work for the administrators and their advisers and becomes an extra cost in the estate administration which could have been avoided had a will been made in the first place.

It also means at least in our own experience that a distribution is made to a large number of people including amongst them some persons who may not have met or even heard of the intestate. Of course as total strangers these kin would not have been named in a will but nevertheless they are entitled along with the others whom the deceased did know as the law may make no distinction.

It is also worth pointing out that in the absence of statutory next of kin within the prescribed entitled classes the ultimate heir in England & Wales is the Crown. Your elderly client may or may not be happy with such an arrangement depending on their political sympathies. Currently over £25 million worth of unclaimed estates is advertised annually by the Treasury Solicitor upon behalf of the Crown. An elderly client with no known kin or at least no close family and no other strong personal attachments can always elect to bequeath their estate to charity to avoid bona vacantia.

The elderly client who has decided to approach a professional adviser has already taken the vital first step towards sorting out their affairs and it is the elderly person who is not yet a client who needs to be reached.

Stephen Rigden is Research Director at Title Research a long-established firm of probate genealogists which provides a confidential service to identify and locate missing beneficiaries on behalf of personal representatives trustees and their legal advisers and in so doing helps them to fulfil their fiduciary duties.