When dealing with the administration of an estate, you will often be faced with unwelcome delays and potentially nasty surprises. A more unusual setback is where you are unable to locate a beneficiary. William Hollins from our Private Client team discusses.
A common example of a missing beneficiary is where the deceased’s Will was made some time ago and one of the beneficiaries has since changed address. So what can you do? Your first port of call should be to write to the missing beneficiary’s address as per the Will, and ask the current occupier whether they have a forwarding address or contact number for the beneficiary. Failing this, you may consider placing an advertisement in a newspaper circulating in the area in which the beneficiary was last heard of – who knows, a friend or neighbour may pick it up and the problem is easily solved. If you are still unable to locate the beneficiary, you might consider the following options so that the beneficiary’s share can be distributed:
- Applying to the court for permission to distribute the estate on the basis that the missing beneficiary has died; Be aware that if the beneficiary subsequently turns up he or she can pursue the recipients of the distributed assets for their share of the estate;
- Distribute the assets to those beneficiaries who would have been entitled had the beneficiary died beforehand; If you choose this option, you should demand an indemnity from the beneficiaries who are receiving the missing beneficiary’s share whereby they agree to pay the missing beneficiary’s share to them if they suddenly turn up;
- Insure against the beneficiary turning up and making a claim; Insurers who offer such a service are few and far between, and those insurers who do provide such cover will likely ask for a genealogy report to be prepared first;
- Instruct genealogists to trace the beneficiary; Most work to a fixed fee but some will work on a contingency basis. Others will charge on the basis that they receive a percentage of the value of the beneficiary’s assets when they are found.
Whichever method you choose, a missing beneficiary can be a headache for the executor of an estate. Tracing the beneficiary can also prove costly (depending on which method you choose). It is therefore advisable to contact all of the beneficiaries at the outset of the administration to notify them that they are due to inherit from the estate.
If any of the beneficiaries have moved away or have predeceased the testator, then at least you will know before the estate is distributed. The benefit of this is that you can take steps to trace the beneficiary whilst you still hold the residue of the estate in your account.
If the estate is distributed leaving just the missing beneficiary’s share and that money is then used to trace the beneficiary, then the beneficiary may challenge you on the basis that you have breached your duty to preserve the assets for them.
If you are administering an estate and require advice or assistance, or wish to discuss a will or probate matter please do not hesitate to contact our Wills and Probate Department on 020 7226 0570 or firstname.lastname@example.org.