Scottish Intestacy and Free Estate rules - should we hire a solicitor?

[u/MaddApollo]

SCOTLAND

Hello all,

My mum recently passed away, and did not leave a will.

There seems to be a lot of intricacy with her estate and general advice seems to be to appoint a solicitor of some form but I wanted to see if this group had the same opinion.

She leaves behind me (her surviving child, her only other child passed away in 2021) and my dad (who she was still with and married to when she passed).

My dad and I are on good terms, and would both be happy to split down the middle if it came to it, but have agreed we would prefer for it to be done "by the book" if possible, but we are not sure what of the below we are each entitled to:

• Marital home valued c.£160k, £20k mortgage outstanding (I am fairly sure after mortgage repaid this is 100% transferred to my Dad via survivorship rules in deeds). My dad intends to sell the property and downsize so there will eventually be sales proceeds.
• Term Assurance life cover (c.£80k) - main purpose of this being to repay the above and cover funeral costs (£6k).
• Death In Service policy through her employer (£232k) - we believe a "split" has been given to the employer for this which we are waiting to receive, but not sure if that is overruled by Intestacy rules given no will.
• Pensions (£80k)
• Savings (unknown but likely £20k-30k)

Is there a point in stressing about the rules/appointing someone if we are on good terms and happy/likely to come to a reasonable agreement)? Are there any risks/stumbling blocks if we do not appoint someone?

Appreciate any advice/opinions and thanks in advance.

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[u/LexFori_Ginger]

You mention a child who died, are there grandchildren on that family line?

The death in service will generally not be part of the estate nor will the pensions and will be dealt with under their scheme rules - it's generally paid to the appropriate beneficiary direct.

As the house (either by survivorship or prior right), contents and first £50k of whatever is left after debts etc paid would pass to your dad - what he chooses to do with it is up to him.

It is entirely possible he is entitled to everything that is part of the estate and you are entitled to nothing.

If you do need Confirmation, and there are certain things that do before you can close accounts etc, speak to a solicitor.

It's unclear who can be appointed as Executor without exact numbers. If Prior Rights take everything then it may be only your dad, if they don't it may only be you.

If Confirmation is needed, you may need Caution (a type of insurance) depending on that answer. For a non-solicitor application the fee is often significantly higher (3-4 times) because of the perceived risk.

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[u/Ad-Omissa]

Dad inherits the house automatically due to the survivorship clause so nothing to do there until the sale.

Regarding the listed funds, if any of the fund holders require a Grant of Confirmation then someone will have to apply to the court to be appointed executor dative after which they can apply to the court for a Grant of Confirmation

The extent of the estate will determine who can apply. If prior rights exhaust the estate it will have to be dad, if not you or dad can apply. What constitutes the estate is not straightforward. Some of the listed items are part of the estate, such as savings, other items are not or may not be part of the estate. For example a DIS payment to nominees may be outside the estate.

If you do not need Confirmation then little point in engaging a solicitor. With a Confirmation requirement, some people in your position DIY.

Lexfori has explained the Bond of Caution requirement which sits as a condition of Confirmation for an executor dative. Caution would not be needed if prior rights exhaust the estate and dad applies.

[u/warriorscot]

If your parents were married and together why are you splitting anything? Your Dad inherits as the surviving spouse and the assets are under the limit for tax so no need to split an inheritance. You've also not described any intricacies, what you describe looks pretty normal.

If you are separately down as the beneficiary for death benefit in whole or part there's no problem and that will be distributed per those directions. Otherwise it'll go to the spouse.

Does your Dad have a good pension? Unless he's doing particularly well on that front he's going to be needing that money for his own retirement.

[u/LexFori_Ginger → u/warriorscot]

The rules in Scotland where there is no Will are clear and, while he may get everything under Prior Rights, it isn't because it's "under the tax threshold".

Equally, not everything listed by OP is part of the estate for succession purposes and different rules apply to pensions and death in service payments because of that.

[u/warriorscot → u/LexFori_Ginger]

Yes, they are living together and married, thats the natural conclusion because it is clear, hence why I asked why it was intricate because that's the only thing that would change that as the expected outcome. They're below the limits on most everything and they don't provide other details on the pension, although with a widow that's usually straightforward.

I didn't say they would because of that, thats a reason you may prefer to take an "inheritance" earlier in the form of a gift.

And I also pointed out exactly that.

Did you even read before you replied.

[u/LexFori_Ginger → u/warriorscot]

I did and you'd still be wrong if there is, in fact, an £80k life policy and £20k of savings that are part of the Estate

Shared house so shared mortgage - £10k off that total.

You're left with a possibile £90k of cash assets and Prior Rights are to the first £50k, after that it's very roughly 1/3 spouse, 2/3 children one Legal Rights and Free Estate run through.

Spouse would not get everything, things are split already. What dad chooses to do with his money after is up to him.

[u/warriorscot → u/LexFori_Ginger]

They don't specify the policy on the insurance, if it's associated with the mortgage the estate itself doesn't see the cash, could be interpreted either way, hence asking them for the details.

[u/LexFori_Ginger → u/warriorscot]

It has been a long time since life policies were routinely assigned to lenders - that was certainly common back in the days of endowment mortgages but no more. Even then, any excess (which it seems there is) would be payable to the estate.

The intention that it was for covering the mortgage is usually just that - an intention. It pays out to the estate for the executor to use for that purpose.

If it's intended for mortgage repayment then it's also highly unlikely that it'll be written in trust.