Archive for June, 2010

Disputing the Conduct of an Attorney following the death of the Donor

Thursday, June 17th, 2010

Disputing the Conduct of an Attorney following the death of the Donor

 Although Enduring Powers of Attorney have now been replaced with Lasting Powers of Attorney, in which a Donor can be much more specific and restrictive when granting the Attorney certain powers, if an Enduring Power of Attorney was executed prior to the changes, it is still valid. Most Enduring Powers of Attorney are likely to be non – restrictive and therefore give the Attorney full power to deal with the financial matters of the Donor, both before and after he or she has lost capacity.

A recent comment made by a defendant Attorney to the executors of the deceased’s estate, when trying to explain a deficit of several hundreds of thousands of pounds in the deceased’s estate is: “But I thought I could do what I wanted with the money” 

As litigators, the question with which we are concerned is: on the death of the Donor, how can the executors of the estate ensure that the Attorney has acted correctly and within his powers?

The main duties and responsibilities of an Attorney, appointed by an Enduring Power of Attorney, are as follows:

  • To always act in the best interests of the Donor and consider their needs and wishes as far as possible;
  • To not take advantage of the Donor’s position and gain a benefit for themselves;
  • To keep the Donor’s money and property separate from their own;
  • To keep accurate accounts of their dealings with the Donor, this includes keeping all receipts and bank statements and all assets and accounts should remain in the Donor’s name;


If there is any reasonable suspicion on the death of the Donor that his or her estate is significantly less than expected and an Attorney has been handling the day to day financial affairs of the Donor, the personal representatives of the Donor’s estate need to consider whether the Attorney has acted in accordance with the above duties.

The personal representatives should request from the Attorney, at the outset, copies of all bank statements, receipts, notes of any requests from the Donor, supporting documentation for any purchases made and any other documentation specific to the Donor and his or her assets.

If the personal representatives are concerned with the conduct of the Attorney or require an explanation of any suspicious or unexplained activity concerning the Donor’s accounts, this request should be made to the Donor immediately, followed by a full investigation made by the personal representatives to the estate.

Should the Attorney refuse to co-operate with the estate, the next stage of the process would be to instruct a solicitor; alternatively make an official complaint to the Office of the Public Guardian and request that an investigation is to be undertaken by it. Other avenues include pursuing criminal prosecution and considering a civil action against the Attorney for fraud.

Can mediation help to resolve a probate dispute over a will, an intestacy or an inheritance claim?

Monday, June 14th, 2010

What is Mediation?

  • It is a consensual process, which uses an impartial individual (the mediator) who will encourage the parties to discuss the issues in dispute, which should lead to negotiations between the parties and ultimately a resolution to the dispute.  The process, is not as yet, a mandatory part of the litigation timetable.
  • Either party can propose mediation, at any stage of the proceedings (or prior to the commencement of legal proceedings if the parties agree). However both parties must be willing to attend, they cannot be forced to attend the mediation. The courts are very much in favour of mediation and the Civil Procedure Rules, which govern litigation, are biased towards litigating parties considering all forms of ADR, although the court cannot order the parties to attend mediation. The court can however, encourage the parties to attend some form of Alternative Dispute Resolution. If parties refuse to do so, at various points throughout the litigation process, the party will have to explain to the court, in a witness statement why they consider that they should not attend.  The risk of not attending is that the court will consider that a party is unreasonable if it does not attend.  This can mean a costs sanction for the offending party.
  • The Protocol Practice Direction states:

“Starting proceedings should usually be a step of last resort, and proceedings should not normally be started when a settlement is still actively being explored.  Although ADR is not compulsory, the parties should consider whether some form of ADR procedure might enable them to settle the matter without starting proceedings.”

  • The mediator is not a judge and therefore cannot give an opinion on the dispute. Mediators are often solicitors, barristers, accountants, surveyors or other professionals. Unlike court proceedings, the mediator will not make an order or a ruling at the end of the mediation as to which party he thinks has the strongest case. The mediator is unbiased and is primarily a facilitator, his aim is to guide and encourage the parties to talk to one another and to work through the issues in dispute to see whether it is possible to reach an amicable settlement or resolution.
  • There are several organisations, which provide mediation services.  We have used CEDR, NDR, ANM and ADR. The organisations usually will provide detailed CV’s of approximately three suitable mediators for the parties to consider and select. The appointment of the mediator is something, which is agreed between the parties. The parties usually decide to appoint a mediator who they feel has the most appropriate experience and background.
  • At Ward Hadaway, three of our partners are accredited mediators and therefore have substantial experience of the process. Namely Paula Myers (Commercial Litigation), Tim Toomey (Commercial Litigation) and Ralph Wrighton (Construction).
  • Once the parties have an agreed on who should be appointed as mediator, the parties sign an agreement which confirms that they agree to attend the mediation. The agreement also lists the names of the parties who are attending the mediation and confirms the date and location which is also something that needs to be agreed.
  • The parties will provide the mediator with copies of the important documents in the case, copies of the statements of case if proceedings have been issued, a chronology and a case summary which highlights the issues in dispute. Mediators often ask the parties to limit the amount of documentation to one A4 file of papers of possible.
  • The parties have to agree on a venue for the mediation to be held. This is usually a neutral venue such as a hotel or a conference suite, or alternatively solicitors offices can be used. The venue must have 3 separate rooms, one private room for each of the parties and a room for the mediator which also holds the joint sessions between the parties or any lawyers only sessions to explore and discuss matters.

How does mediation work? What is the procedure?

Opening session

  • At the start of the mediation, the mediator, the parties and their representatives meet in the joint meeting room. The mediator will introduce the parties and himself and will explain a number of practical points for the day i.e. where the rooms and facilities are, how the process is consensual and is both confidential and without prejudice. The mediator will also explain how the mediation process works and how joint sessions and a number of private sessions with the parties will take place throughout the day. In the private sessions the mediator will explore the issues in dispute and talk to the parties about the strength of their case and the likely costs consequences of not being able to reach a resolution.
  • It is crucial that the parties attending the mediation have full authority to settle the dispute, as the ultimate aim of the mediation is to reach an amicable resolution, which will result in a written, binding agreement being signed on the day. It is therefore important to ensure that the parties attending the mediation are authorised to make a decision regarding the settlement of the case.
  • Each party will the give a short presentation of its case.  The purpose of the opening session is to enable the parties to meet face to face which may in some cases be the first time that the parties have met since the commencement of the dispute.
  • The opening session usually lasts between 30 minutes to an hour. Once the parties have presented their case summaries, the parties will retire to their private rooms. The mediator will then spend time with each party in their private rooms, these sessions are called “caucus” periods.
  • The private sessions are very useful as they allow the mediator to build a rapport with the parties and to explore the issues in the dispute. It is usual for the mediator in those sessions to discuss at length what will happen if a settlement is not reached. The discussions will focus on the costs and the risks of the litigation proceedings and whether a commercial or personal relationship can continue after the dispute.
  • Approximately 90% of cases are resolved without having to proceed to trial. Mediation is extremely successful at achieving a resolution to disputes. If however, a case does not settle at mediation, it is still possible to resolve the matter before trial as the mediation process may have enabled both parties to explore issues and can narrow the issues in dispute. Some disputes do not settle on the day of the mediation but are resolved a few days or weeks afterwards, once parties have had time to reflect on the dispute.

Are all cases suitable for mediation?

  • Most cases are suitable for mediation, however the process is aimed at offering a quicker and more cost effective resolution of the dispute, avoiding what can be substantial trial costs.  The timing of mediation is important as it needs to be sufficiently early to justify the costs savings of the exercise, but not too early so that the parties are still considering the evidence and merits of their case.
  • Mediation should always be considered where:
    • The costs of the litigation will be disproportionate to the claim;
    • The complexities of law and/or fact are likely to protract proceedings;
    • The parties are already deadlocked in settlement negotiations;
    • The issues involved are sensitive or require the disclosure of sensitive evidence and the parties wish to retain anonymity.
    • Where one party is suggesting mediation, the other party must give serious consideration to this proposal. Recent caselaw suggests that a party who is unwilling to participate in mediation is likely to face significant costs consequences and penalties, even if they proceed to trial and win their case.
  • Mediation is not suitable where:
    • There is an important point of law to be tested by the courts and a commercial or legal precedent needs to be set;
    • Summary judgment or an application to strike out is more appropriate;
    • The parties require emergency injunctive or protective relief;
    • Settlement discussions are successfully progressing;

Advantages of Mediation?

  • The parties are able to reach a resolution themselves, as opposed to having a decision imposed on them by a judge at trial. This can often include a settlement on peripheral matters that are important to the parties but are not the focus of the litigation proceedings.
  • It strives to achieve a “win, win” result which is usually not possible with litigation.
  • Parties are given the opportunity to “have their say” which is prevented in a trial environment as the parties are constrained by the laws of evidence and court etiquette.
  • A resolution can save unnecessary legal costs.
  • Commercial relationships can be saved which is also unlikely after a contested trial.

How much does Mediation cost?

  • The costs of the mediator range from approximately £2000 – £4000 plus VAT per day. Travel expenses, room hire and refreshments will also need to be added to the overall costs. The costs are usually split equally between the parties.
  • The mediator’s costs are also often paid for before in advance of the mediation.
  • The parties will also have to bear the legal costs for their solicitor to prepare for and attend the mediation. There is a substantial amount of preparation work that needs to be carried out in readiness for the mediation and to ensure that it has the best possible chance of succeeding, such as preparing a position statement, mediation bundle and a confidential briefing for the mediator.
  • Each party will also have to ensure that they are available for the full day and are not time constrained as this could damage the progress of the negotiations. Mediations can be time consuming and last into the evening, it is therefore essential that parties are aware of that and prepared to stay as long as is necessary to try and resolve the issues in dispute.

Contesting a deceased’s estate for damages pursuant to a contractual promise

Thursday, June 10th, 2010

Contesting a deceased’s estate for damages pursuant to a contractual promise

The law in England and Wales provides for the freedom of testamentary disposition. This means that a testator is free to leave his entire estate to whoever he wishes, whereas there are many jurisdictions which do not allow such freedom and follow a system of forced heirship, meaning you cannot disinherit your bloodline no matter how much you would wish to.  

 Although our jurisdiction does allow for such freedom, there are various remedies available to a disappointed claimant who may have expected to benefit from a deceased’s estate. These include contesting the validity of a will (see article 31 March 2010 ) or bringing a claim on the grounds of proprietary estoppel (see article dated 31 March 2010 ).

 An alternative option available to the disappointed claimant could be to bring a claim for damages against the estate for breach of contract. The claimant would have to show that the testator was contractually bound to provide for him or her in his will, failing which the claimant is entitled to damages to reflect the testator’s breach.

The claimant would need to show that all of the elements required to create a contract between it and the testator exist which are:

  • An offer to contract on specific terms, made by either the claimant or the testator and that this offer was accepted. Therefore for example, that the claimant agreed to lend £100,000 to the testator over 10 years free of interest during his lifetime on the basis that he would receive the requisite amount of interest (e.g. 10% APR) upon the testator’s death. The testator therefore agreeing to these terms and agreeing to provide for the interest payment in his will.
  • Consideration provided by both parties on the basis of the agreement, in this example being the £100,000 interest free lifetime loan being provided by the claimant and the execution of a will providing for interest to the claimant being provided by the testator.
  • An intention on the part of both the claimant and the testator to create legal relations, which in effect binds both parties to their promise.

 As with all claims of this nature, a claim would need to be supported by documentary evidence. If the testator made a will at the time of the agreement to reflect the agreement, yet subsequently changed that will, the first will would be evidence of the testator’s intention at the time of the agreement. This would have to be supported by further documentary evidence between the parties regarding the agreement and any witness evidence to support that the agreement in fact took place.

Such a claim would not change the testator’s final will, which would still be admitted to proof, rather the claimant would have a claim for damages against the estate which if proven and granted would be paid as a debt of the estate before the estate is administered and its assets distributed. The net consequence therefore affecting the ultimate distribution to the residuary beneficiaries of the testator’s final will.

Caveat or Grant ad colligenda bona or an injunction?

Wednesday, June 2nd, 2010

How to stop probate being granted whilst you investigate your dispute

Caveat or Grant ad colligenda bona or an injunction?


If you think you may have a probate claim against a deceased’s estate, the next steps to allow you to investigate the dispute and consequently bring your claim against the estate are vital.

The specific steps which you should take depend upon the circumstances of each case and you must consider matters such as whether there is a grant of probate, whether the estate has been distributed and or administered and the character and any personal interest of the personal representatives in the estate.


If a claim is discovered at an early stage before the personal representatives have applied for probate, a caveat can be entered on the District Probate Register. It is a written notice to the Probate Registry, which ensures that a grant of probate or letters of administration are not issued to the personal representatives of the estate without a warning being served on the potential claimant, who would then be known as the “caveator”. In practice this generally protects the potential claimant’s position whilst he or she investigates the claim against the estate.

In practice, the personal representatives tend to undertake or agree not to apply for a grant of probate until the claim has been investigated. However should the estate decide to proceed with an application for a grant of probate in any event, the caveator will receive the warning that this is occurring and has only 8 days from the time of receiving the warning in which to take legal action. A hearing will take place before the District Registrar who will decide whether the estate can take out a grant of probate.

A caveat will last for 6 months, following which it must be renewed, this gives the potential claimant some time to investigate its claim and notify the opponent of the nature of the dispute and claim.

Application for a Grant ad colligenda bona ( a limited grant of probate where there is a will which is often subject to a dispute)

It may be that the personal representatives need to apply for a grant of probate in order to preserve the assets of the estate, for example if a property needs to have substantive works done to it to avoid its destruction or decreasing in market value. In this case it is in the claimant’s best interests to preserve the value of the estate. The claimant could therefore agree to remove the caveat from the District Probate Register in order to allow the estate to preserve the assets, pending the outcome of litigation and a limited grant of probate can be obtained, namely a grant as colligenda bona. This does not allow the estate to be distributed.

Injunction to prevent estate assets from being distributed

What can the claimant do if it only becomes aware of its potential claim after probate has been granted and there is reasonable suspicion that the estate is being distributed in accordance with the will or intestacy?

A simple approach would be to request an undertaking from the estate that it will not distribute assets until the outcome of the potential litigation. However should the estate be hesitant to provide such an undertaking and there is evidence that assets are being distributed from the estate, the claimant can make an application for an injunction to prevent the estate from distributing assets. This would be a last resort as it is costly and the claimant has a high onus upon it to prove the possibility of its potential claim against the estate along with providing strong evidence that the assets are being distributed. An example of the evidence would be that an estate property has been transferred into another person’s name.

There are therefore various ways in which a claimant can protect his position when discovering he or she has a claim against a deceased’s estate, early action is preferred and is the  cost effective method.