Is HSBC appointed as an executor in your will? Sale of HSBC Wills and Probate Services should prompt you to review your wills.

On 10 July 2015 HSBC customers who made wills with HSBC and appointed HSBC as the Executors of their wills received a letter from the bank informing them that the Probate Services business has been sold to an independent legal services company, Simplify Channel Limited (Simplify).   The transfer is expected to take place on 30 October 2015 after which point HSBC will no longer offer an executorship service to its customers.

In their letter, HSBC asked its customers to appoint an alternative executor in place of HSBC using pre-prepared codicils.  HSBC offered three options to its customers: (1) to appoint Simplify as an executor, (2) to appoint another executor of their choice or (3) to confirm that the will is no longer valid.  Simplify are not able to act as executors, in HSBC’s stead, unless they are expressly appointed.  HSBC set a deadline of 31 July 2015 within which its customers had to respond to them with their instructions.

The role of an executor is a crucial one as these are the individuals or organisations that have been appointed to carry out the directions of the will and administer the estate.  If there is no executor named in the will or if the executor named cannot or does not wish to act, another appointed executor (if any) can step in or, where no other executors are appointed, beneficiaries can apply to administer the estate.  Appointing a trust company as your executor can sometimes incur high fees after your death, even if the cost of preparing your will itself is kept to a minimum.  You should always consider who is best placed to act as your executor, whether that is a family member, a friend, a professional or a combination.

In the ever evolving business world it is a common occurrence that law firms and other organisations are brought out and merge, wills can be drafted so that the successor of your chosen professional executor can act in their stead without having to be specifically appointed.

We would highly recommend that you obtain legal advice from a reputable firm of solicitors if you appointed a professional executor that no longer exists or if you have made a will with HSBC and would like advice on your current position, or even if your will is a few years old and needs a review.  Wills are live documents and should be kept under constant review throughout your life.

Should you wish to make a will or review an existing will please do not hesitate to contact a member of the Hart Brown Trust & Estates team, who would be happy to assist.

Yana Davies, Solicitor, Trusts & Estates

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The dangers of ‘cheap’ wills

A woman is seeking hundreds of thousands of pounds in compensation after she lost out on her inheritance.

Ebenezer Aregbesola had instructed Barclays bank to draft his will in 2007 leaving a half share in his South London property to his daughter Tinuola Aregbesola. The property in Balham was owned jointly by Mr Aregbesola and his wife, who was not Tinuola’s mother, as joint tenants.  Barclays had failed to sever the joint tenancy of the property meaning that the valuable property passed directly to Mr Aregbesola’s wife on his death. The severance of joint tenancy was described by the Financial Ombudsman’s Service (FOS) as “a simple formality”.

The claim was investigated by FOS and they held that the bank was at fault and ordered them to pay “a fair and reasonable settlement” to Miss Aregbesola. The bank chose to ignore the Ombudsman’s recommendation and the case is now set to be heard in the High Court.

Barclays will writing arm is not regulated and therefore were not bound to follow the recommendation of the Ombudsman.

Often these companies are able to offer cut price wills as they look to benefit later under the administration of the estate as the executor of the will. This kind of practice has come under scrutiny before; in 2011 the Office of Fair Trading said: “‘The wrong decision when appointing executors could mean a potentially expensive professional service is chosen, when a family member or friend may be quite capable of handling the task either alone or with professional support.”

This case highlights the dangers of “cheap” or “DIY” will writing services as these companies are not regulated and often do not have the expertise and knowledge to prepare such an important document.  We would always recommend obtaining advice from a qualified person, such as a solicitor, with specialist experience in the field of wills, estates and inheritance tax planning.

Kerry Hay, Solicitor, Trusts and Estates

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A weekend of showjumping

Hart Brown’s Emily Wiggins and her horse Basil returned to the showjumping circuit after a 4 month break recovering from an injury this weekend. Basil was extremely pleased to be out again and jumped brilliantly.

They were placed 6th out of 46 in their class which has qualified them for a championship which is to be held at Hickstead later in the year.

Emily said “I was just looking for somewhere to get Basil out and jumping again, I didn’t even realise the class was a qualifier! It’s always wonderful if you manage to go double clear but I didn’t dream I would be placed!”

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Death and your digital footprint

You may not have thought about what will happen to your digital accounts such as your Facebook, Twitter and LinkedIn accounts when you die however this is becoming more relevant in an increasingly digital world.

Many of us have a number of online shopping, gaming, bank and social media accounts, at our fingertips.  To avoid digital assets being lost in cyberspace it is important to consider what you would like to happen to your digital footprint upon your death.

With the number of online accounts available to us, it isn’t always easy to keep track of your different usernames and passwords. Just imagine the difficulties your personal representatives may face in managing your accounts when you’re no longer here. For this reason, we recommend our clients prepare an updated note of their digital assets, together with details of usernames, passwords and answers to secret questions to be kept in a very safe place. We give our clients the option for this note to be placed with their Will in our safe room, with the aim of providing guidance to their personal representatives.

Interestingly, Facebook now gives you the opportunity to appoint a ‘legacy contact’. A legacy contact should be a person you would trust to memorialise your account when your die. Careful consideration should be given to this appointment as your legacy officer will have the option to respond to new friends requests, update your profile picture and cover photo and will also have the ability to post a final message on your ‘wall’, on your behalf. Akin to providing your funeral wishes, you may wish to leave written instructions to your legacy contact on what you would like to be said to your friends and family in this final post.

If you so desire, you can also give your legacy contact additional permission to download a copy of what you’ve shared on Facebook, which may be a nice way for your loved ones to  remember your experiences and friendships. You can be assured however that your legacy contact will not have the power to read your private messages or to remove or change your past posts. Everyone is likely to have their own personal views on this subject and as an alternative Facebook also gives the option for your account to be deleted, should you wish.

I know it may an unusual thing to think about, but like with Facebook, it may be beneficial for you to consider each of your online accounts and to make a written note of your wishes to assist your loved ones in managing your digital footprint when you’re gone.

If you have any questions, or if you would like advice on any aspect of estate planning, please feel free to contact our Trust and Estates Department.

Rachael Brady, Solicitor, Trusts and Estates

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Pro Bono Bonus

The government has recently said that lawyers need to do more pro bono work which most of us already do in one form or another.  In a number of situations this work can deliver real benefits as ably demonstrated in the recent case of Ilott-v-Mitson where the claimant in a claim under the Inheritance (Provision for Family & Dependants) Act 1975 was represented by two barristers from the Bar Pro Bono Unit.

Mrs Ilott’s claim under the Inheritance Act has gone through something of a roller coaster ride.  Prior to her mother’s death Mrs Ilott had been estranged from her for some 26 years.  Her mother left an estate worth £486,000 largely to three charities.

Before the first judge she was awarded £50,000.  She appealed saying that that was not enough and the three charities then appealed on the basis that she should have got nothing.  The second judge dealing with the appeal sided with the charities and gave her nothing.  She then appealed again.  The Court of Appeal the first time said that an original decision in an Inheritance Act claim should only be set aside on appeal if it is plainly wrong.  The decision to give Mrs Ilott £50,000 was not plainly wrong and shouldn’t have been overturned but if the second judge had dealt with the case first and had awarded Mrs Ilott nothing that would not have been plainly wrong either!  Confused!?

This still left open the question of whether the £50,000 which she had been awarded initially was the correct figure.  The first judge dealing with the reconsideration of  that issue agreed with the figure of £50,000 but the Court of Appeal (the second time) have now overturned that decision.  Mrs Ilott has now been awarded £143,000 as the costs of buying a property plus the costs of acquisition plus the option to draw down a further £20,000 from the estate.  Overall therefore it appears that she has been awarded about a third of the overall estate.  The assessment of the value of the case was complicated by the impact of state benefits on the claimant’s financial position and how that would be impacted by any capital award.

The charities’ position quoting from a 1980’s case seems largely to have been that “an Englishman still remains at liberty at his death to dispose of his own property in whatever way he pleases”.  Clearly however parliament has decided that that principle is still trumped by the ability of the courts to ensure in appropriate cases that even in the case of an adult child, reasonable financial provision can still be made despite the provisions in the will.

These cases are very fact sensitive and require expert advice and assistance

Paul Grimwood, Partner, Dispute Resolution

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Because family matters

While some may feel it makes good reading for the media to splash across their front pages the intimate details of the demise of so called ‘celebrity’ marriages, it is important to remember that the breakdown of any marriage is a real tragedy for those involved, particularly for the children.

At a time which any couple undoubtedly finds very difficult, should the media not be showing compassion?

Perhaps it is because the law in England and Wales still requires one party to blame the other for the breakdown of the marriage which is unfortunate, because it can result in a degree of acrimony at the very outset, which we at Hart Brown seek to avoid. There are some occasions where blame does not need to be shown such as where there has been a separation for 2 years or more. Would it not be kinder for all those involved if you could divorce without blame and without having to go back over the reasons the marriage broke down?

At the very least, it would ensure that the private lives of those involved could remain private.

Furthermore, court is not the only answer. Where marriage comes to an end there are various options available to resolve the parties’ issues and to achieve settlement; mediation allows clients to directly negotiate with the aid of a non-judgemental third party;  the collaborative process is where parties with the assistance of their lawyers work together to resolve their issues in a series of round table meetings.

As the summer holiday draws near our focus should turn to the children. It is important to remember that their welfare is of paramount importance in any marriage or relationship breakdown and that their wishes and feelings based on their maturity should be taken into consideration when looking at  new living arrangements. Recognising that they will need support and guidance through this difficult period will make the transition easier for all involved.

At Hart Brown, we pride ourselves on really listening to our clients and tailor our advice to their individual circumstances.  Our expert team of lawyers includes trained mediators, collaborative lawyers and those experienced in negotiating directly with other lawyers so that we can offer all forms of dispute resolution. We are also able to refer our clients, where necessary, to other professionals, such as family therapists and counsellors to support them through this difficult period. We recognise that the easier the separation journey can be, the better the outcome for the family.

Kate Smith, Senior Solicitor, Family

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Parking ticket battle heads to the Supreme Court – Update

In a previous blog, “Is it time to say ‘on your pike’ to excessive parking fines?”, we reported that Barry Beavis had been challenging ParkingEye (a private parking organisation) through the courts   in relation to the disproportionate cost of parking fines.

The Court of Appeal dismissed his challenge in April 2015. They stated that these charges were not ‘penalty clauses’. Under contract law in England and Wales  penalty clauses are unenforceable. The argument by Mr Beavis  is that these fines do constitute a penalty and bear no relation to the actual loss incurred by the parking companies. The parking companies clearly suffer no loss because the car parks in question are often ‘free’ for a set period of time, as was the case for Mr Beavis.

On the 23 July 2015 the case was taken to the Supreme Court. Mr Beavis used a ‘crowdfunding’ website to pay for some of his costs. Within 48 hours of listing it on the site he was able to surpass the £6000 that he needed to pay the court fees. He has been able to secure the services of a QC on a pro bono basis. The case was heard in front of seven of the most senior judges despite the fact that in money terms only £85 is in dispute.

The outcome will be of great interest to all motorists. Should Mr Beavis succeed he will potentially open the floodgates to parking fine refunds possibly running into millions of pounds, but if ParkingEye succeed it could lead to  parking fine increases.

John Aslett, Paralegal, Dispute Resolution

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Can it be illegal to comply with the law of the land?

Sounds like a barmy question don’t you think?

Well, if you wanted another example of how complicated modern life is becoming then one needs to go no further than to consider the case of Coventry & Others-v-Lawrence & Another which the Supreme Court (SC), formerly the House of Lords, considered earlier this year.

The SC’s reserved judgment was in fact given this week.

In brief the case that the SC had to consider was whether the legality of the Access to Justice Act 1999 (AJA) could be challenged.  The AJA allowed conditional fee agreements (CFAs) to be used more widely and created a regime where unsuccessful parties had to pay the winner’s solicitors success fee and the after the event insurance premium, which together became known as “additional liabilities,” on top of the winner’s normal reasonable base costs.  These additional liabilities could increase the overall costs payable by the loser by a very large amount.

At the time when parliament was considering the bill that became the AJA 1999 MPs had to consider how to give the public access to justice when at the same time legal aid was being reduced dramatically.  The regime created by the AJA emerged from this context.

Criticism of the AJA regime started to build up after it came into force in 2000.  In 2013 the Legal Aid, Sentencing and Punishment of Offenders Act (LASPO) came into force and LASPO changed the position significantly as success fees and the full cost of after the event insurance premiums were no longer to be paid by the loser.  This change came too late to assist the defendant in the case being considered by the SC.  Mr David Coventry and another defendant had been successfully sued by Katherine Lawrence and another claimant.  Mr Coventry argued amongst other things that the payment of the additional liabilities required of him infringed his article 6 rights to a fair trial and this was therefore in contravention of the European Convention on Human Rights.

So what was the result of the SC reviewing these matters?

By a majority of 5 to 2 the SC concluded that the AJA regime was not incompatible with article 6, but rather that the regime was “as a whole a rational and coherent scheme providing access to justice to those to whom it would probably otherwise have been denied”.

The AJA regime – used by countless individuals and lawyers since 2000 – remains according to the majority of the SC a valid regime.

If the SC had decided otherwise it would arguably have meant that everyone who had sought to comply with the law of the land as set out in the AJA would have been complying with an invalid and therefore illegal scheme.

Now, would that not have been truly barmy?

Marek Bednarczyk, Partner, Dispute Resolution

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Clinical negligence costs under attack

The Telegraph has recently reported that government proposals to cap legal costs and to limit costs to a proportion of a claimant’s damages in clinical negligence cases are gathering pace.

The NHS LA, the body responsible for managing the clinical negligence claims against the NHS, has endorsed these proposed moves by highlighting a number of cases where a claimant’s solicitors have been paid significantly more than the claimant has received. The NHS LA has quoted eye catching figures showing that £501.7 million (including damages) was paid to the top ten law firms between April 2010 and the end of 2014.

The NHS LA rationale for introducing costs capping is that legal fees must be fixed at a more proportionate level.  Their view is echoed by Dr Matthew Lee, Professional Services Director for the MDU – the body which supports doctors facing clinical negligence claims.  He was recently quoted by a BBC report as saying “legal fees must be affordable and proportionate”.

The reality of the situation is that too many people are quick to jump to the unfair conclusion that claimant clinical negligence lawyers are charging excessive fees for running cases. A number of factors need to be taken on board. First, of the 10 top law firms sharing in the £501.7 million quoted above, 7 actually act on behalf of the NHS Trust being sued.  Secondly, clinical negligence cases are often extremely complex and involve the instruction of several highly skilled experts whose fees are necessarily high given the detailed nature of their reports. Thirdly,  because the NHS LA choose to regularly defend cases where they should admit negligence at an early stage, claimant’s solicitors have no alternative other than to issue court proceedings in order to obtain access to justice for their client.  I recall one example a couple of years ago when I was acting for a lady who went into hospital for routine hand surgery – a trapeziectomy . The consultant treating my client wrongly removed her scaphoid bone instead of her trapezium bone.  This led to my client requiring numerous further operations and, ultimately, a wrist fusion.   The NHS LA denied any liability!  Proceedings had to be issued and costs escalated. The NHS LA could easily have saved £20,000 by admitting liability prior to issue of proceedings.

It is at the point of issue of proceedings that costs start to really accrue due, to a not insignificant extent, to the government’s own decision to dramatically increase court issue fees from 29 March 2015.  Issue fees are becoming prohibitive.  By way of example, a claim pleaded at £200,000.00 on 28 March 2015 entailed paying a fee of £1,515.00.  The fee is now £10,000.00.

Clinical negligence solicitors have only just become accustomed to the measures put in place to control expenditure in these cases – namely the much published costs budgeting regime.

Access to justice is not likely to be served by tinkering even further with the costs regime and introducing costs capping measures.  If the NHS LA are really committed to insuring that costs remain proportionate, the easiest and most cost efficient policy to adopt would be to ensure that they focus on admitting liability at the earliest opportunity in deserving cases, thus ensuring that the risk of costly litigation is minimised.

Gerard Sanders, Associate Solicitor, Personal Injury and Clinical Negligence

 

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Whingeing rich lawyers should work for free!

The above title is a para phrase of the Mail Online which this week reported on the speech made by the new Justice Secretary Mr Michael Gove.

The Mail Online’s actual headline was: “Gove orders rich lawyers to stop whingeing about legal aid cuts and work for FREE to help poor victims of crime”.

Earlier this week Mr Gove made his above speech at The Legatum Institute.  If you missed it the speech it is published on the gov.uk website.  I have read it.

If Mr Gove kept to the speech as published on the gov.uk website then it appears that the Mail Online’s headline was not quite accurate.  I cannot find a reference in the speech to Mr Gove ordering rich lawyers to work for free and he did not apparently state that rich lawyers should stop whingeing about legal aid cuts either.

In the published speech Mr Gove states: “I know that many of the most prestigious chambers at the bar and many of the top solicitors firms already contribute to pro bono work and invest in improving access to the profession.  Many of our leading law firms have committed to giving 25 hours pro bono on average per fee earner each year.  That is welcome, but much more needs to be done”.

What is not clear from the speech is what is it that needs to be done over and above what is already being done by firms and barristers?  The speech is a little light on detail.  I just wonder how a commercial lawyer based in the city of London, for example, could provide advice on a pro bono basis(i.e. work for free for the public good) to someone say who needs representation within the criminal legal system?

Of course, pro bono work is undertaken by many barristers and solicitors not just a select number of chambers at the bar or by the so called “top solicitors firms”.  Mr Gove does cite statistics which seem to indicate that only 16% of solicitors in commerce and industry provide an hour or more pro bono work.  I suspect that if one looked at the issue more broadly (beyond lawyers in commerce or industry) that is by no means an accurate picture.

Since I started working for Hart Brown over 20 years ago I have regularly attended CAB sessions to help members of the public where such assistance is provided for free.  Many of my colleagues also regularly provide such advice as do other members of other firms in Surrey.

Lawyers receive enquiries on a daily basis many of which of course do not result in paid work, but helpful information and guidance is given to members of the public by lawyers effectively for free.  There is no doubt that this is of great assistance, but there are times when an individual may require much more specialist guidance.

The elephant in the room of course is legal aid.  The legal aid system was established in order to provide the public at large with access to top quality legal advice in the specialist areas which were relevant to that individual’s case.  Hence, there remains a need for a fully funded legal aid system and yet successive governments have cut legal aid services year on year.

In Mr Gove’s published speech he also stated: “Legal aid is a vital element in any fair justice system”.

The speech appears to show that Mr Gove wants to maintain a high quality legal aid service.

The Mail Online appears to have missed that bit out from their article.  Be that as it may is it the case that Mr Gove’s speech is just a masterclass in political rhetoric or will we see genuine funded legal reform which will in due course create what Mr Gove wants to establish namely a “one nation justice policy”?

Hold your breath and watch this space!

Marek Bednarczyk, Partner, Personal Injury and Clinical Negligence

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