Legal Practice Notes

Duty to act personally As a matter of principle, the basic rule is that a trustee must act in person because the settlor personally selected that individual for their specific skill or insight into the beneficiaries, and their affairs. The Trustee Delegation Act 1999 ( TDA 1999) allows trustees, in defined situations, to delegate on an individual basis. The Trustee Act 2000 ( Tr A 2000) outlines the trustees’ default powers of collective delegation where the trust deed does not confer broader express powers. In essence, trustees may pass on most administrative tasks, but not dispositive powers. Agents, nominees and custodians Under the Tr A 2000, the management of trust assets may now be entrusted to others, and trustees can appoint specified persons to serve as nominees for the trust. Collective delegation Tr A 2000, Pt IV (ss 11–27) provides for trustees to delegate...

This Practice Note sets out guidance on acting as a guardian for a missing person under the Guardianship ( Missing Persons) Act 2017 ( G( MP) A 2017). It explains guardians’ powers and obligations, how supervision by the Office of the Public Guardian ( OPG) operates, and practical first steps on appointment. For advice on when it is appropriate to seek the appointment of a guardian under the G( MP) A 2017, and the procedure for issuing a claim, see Practice Note: Making an application to appoint a guardian to manage the property and financial affairs of a missing person. For guidance on changing, ending or renewing a guardianship order, see Practice Note: Changing, ending or renewing a guardianship for a missing person. Duties of the guardian A guardian must comply with duties set by their guardianship order, the G( MP) A 2017, and any...

People incur liabilities-arising from contracts, covenants, debts and duties-and, in broad terms, these do not lapse on death but can be pursued against the estate. Even if the personal representatives ( PRs) did not join the original arrangements, they ought to appreciate potential exposure to avoid litigation ( Hambly v Trott (1776) 1 Cowp 371). The consequences of this survival turn on the nature of the obligation. Personal contracts Ordinarily, a contract is not dissolved by a party’s death. However, for contracts of a personal character, the rule is displaced unless there was a pre-death breach. Thus, an employment contract ends on the death of either employer or employee, and a commission for creative work ceases on the artist’s or author’s death. Although the contract may come to an end, any earned but unpaid remuneration due to the testator endures and the PR may bring...

The legal costs position in probate claims The cost landscape in probate disputes is frequently misconstrued. This Practice Note addresses: the costs position in proceedings challenging the validity of a Will, and applications under the Inheritance ( Provision for Family and Dependants) Act 1975 ( I( PFD) A 1975) The starting point-the general rule A widespread myth is that the estate routinely meets the litigation costs. That is wrong. CPR 44.2 governs both probate proceedings and I( PFD) A 1975 claims. The usual rule is that costs follow the event. A losing party will ordinarily be ordered to pay some or all of the successful party’s costs ( CPR 44.2(2)), subject to the court’s discretion. The court may exercise that discretion by assessing conduct. Conduct ( CPR 44.5) covers behaviour before and during the claim, including the extent of compliance with any...

The nature of disputes as to lifetime dispositions Where an estate proves to be less than expected, personal representatives ( PRs) and beneficiaries frequently raise questions and concerns about transactions the deceased undertook while alive. These may encompass outright gifts, asset disposals apparently at an undervalue, loans on favourable terms, sole assets placed into joint names, and deathbed gifts. If an attorney or deputy managed the deceased’s affairs, enquiries may need to focus on their conduct as well. There are several grounds on which a lifetime disposition can be contested. Allegations may include: the deceased lacked capacity (including potential abuse by an attorney or deputy) the deceased was subjected to undue influence, and the criteria for a valid deathbed gift (donatio mortis causa) were not satisfied The test for capacity to make lifetime gifts and the burden of proof The common law test for mental capacity to make a...

Personal representatives’ duties Under the Administration of Estates Act 1925 ( AEA 1925), personal representatives ( PRs) are required to: gather in and realise the deceased’s estate; and administer it in accordance with the law. The court may oblige PRs to produce an inventory of the estate and full accounts of their administration. They should be cautious about resisting beneficiaries’ requests for an account, or risk substantial costs being ordered against them. See News Analyses: Holding personal representatives to account-discharging an executor’s cardinal duty ( Ali v Taj [2020] EWHC 213 ( Fam)) and Indemnity costs following failed appeal against order for account and inventory ( Ali v Taj). PRs also have a duty to settle the deceased’s debts with due diligence, taking into account the estate assets properly available for that purpose. They should also consider any obligations owed to potential...

Section 55(1)(xi) of the Administration of Estates Act 1925 ( AEA 1925) defines ‘personal representative’ as: The expression covers the executor—whether originally appointed or by representation—or the current administrator of a deceased person. For the purpose of liability to death duties, it embraces anyone who, without the authority of the personal representatives or the court, takes possession of or interferes with the deceased’s property; and ‘executor’ further extends to a person treated as appointed executor in relation to settled land. An executor is an individual named in a valid Will or codicil to manage the testator’s estate and give effect to the Will’s provisions. See also Practice Note: Private Client England & Wales glossary— Personal representative. Where the deceased died intestate, an administrator may obtain a grant of letters of administration. If there is a Will but no effective appointment of...

Testator’s relationship to beneficiary Most will‑makers leave gifts in their Wills to beneficiaries named expressly, described by their relationship, or-preferably-in both ways. On occasion a legacy is directed to someone identified by their role or position (eg, my executor, my gardener). There are a number of general principles relevant to describing a beneficiary by relationship: As a general rule, such a description points only to relatives by blood (including those of the half‑blood) and excludes persons connected by marriage or by descent; thus ‘my niece’ would ordinarily be read as the daughter of one of the testator’s own siblings, rather than the child of a sibling of the testator’s spouse, subject to the next point Where the context or surrounding circumstances permit, the description may extend to persons related solely by affinity-for example, decided cases indicate: a nephew of the testator’s wife qualified as a...

Where a testator holds a stake in a business, this will often represent their chief asset (aside from the family home), whether judged by capital worth or by its role in producing income. It demands careful planning so the testator has addressed what should occur to the business on their death. The right route for passing on that interest turns on several factors, notably the business structure (for example, whether it is incorporated or not). If the business is set up as a company, a management framework may already exist that can keep operations going for the estate’s benefit. For an unincorporated venture, there is uncertainty about whether it can in fact continue after the testator’s death (and similarly this may apply even to a company where the testator effectively runs it alone). If it is a partnership, it might carry on with other...

There are principles to weigh when advising a testator on appointing executors of their estate, trustees of any Will trust, and guardians for any minor children they may have. In addition to those principles, a testator must also reflect on whether proposed appointments are appropriate in light of their family and personal circumstances. There are typically several factors to review, and the principal points for consideration are identified below. Executors An executor is the person named in the Will to give effect to its terms and to administer the testator’s property and affairs. For further guidance, see Practice Note: Definition of a personal representative. Leaving out the appointment of one or more executors does not make a Will invalid. Nonetheless, such an omission is not advisable, because it creates a period after death when no one is in control of the testator’s estate and affairs. The...

Appropriation is the means by which a personal representative ( PR) or a trustee applies a particular asset from an estate or trust fund to satisfy, wholly or partly, a beneficiary’s entitlement or interest. Personal representatives' common law and statutory power of appropriation At common law, PRs may appropriate any element of the residuary estate (but not a separate fund) with the beneficiary’s consent, in or towards satisfaction of a vested legacy or a share of residue, even where payment is deferred. That power does not reach a contingent legacy unless it carries a right to the intermediate income. It extends to both real and personal property, whether or not that property is held on a trust for conversion. The common law power does not authorise PRs to appropriate unauthorised investments. Under section 41 of the Administration of Estates Act 1925 ( AEA 1925), PRs also have a...

Charity trustees involved in litigation must continually assess prospects of settlement with the other side(s), aiming to meet some aims of the proceedings while cutting off legal spend and reducing exposure where that serves the charity’s best interests. Striking a compromise is frequently intricate, so expert guidance should be sought as early as possible. Matters such as any tax implications that could arise fall outside this brief overview. The general requirement on litigants to attempt to settle disputes In England and Wales, the Civil Procedure Rules oblige parties to consider alternative dispute resolution ( ADR); penalties may follow for a refusal. Charities are treated no differently. For instance: a court may halt charity proceedings until ADR has been attempted. In Muman v Nagasena the judge remarked: ‘ In this case very substantial sums of money have been spent on litigation without achieving a...

This Practice Note offers a hands-on overview of the first actions a deputy should take once appointed. Checking and understanding the deputyship order The deputy must review the deputyship order and become fully acquainted with its terms, so they know precisely which decisions they are authorised to make for the protected person ( P). If any mistakes are identified, they should be put right without delay. Minor slips, such as a misspelt name, can usually be dealt with informally through the Court of Protection; however, more significant errors should be addressed by lodging a COP9 application within the proceedings. If the deputy does not alert the court to any errors within 21 days of the date the order was sent to them, they may have to pay for a further application to remedy the issue. Common decisions covered by health and welfare orders...

Charity regulators in the UK The Charities Act 2011 ( CA 2011) became law on 14 March 2012 and determines the registration and oversight of all charities in England and Wales. It supersedes most provisions of the Recreational Charities Act 1958, and the earlier Charities Acts of 1992, 1993, and 2006. By consolidating four Acts into a single statute, CA 2011 aims to simplify the legal landscape. Together with subordinate regulations and the accounting Statement of Recommended Practice ( SORP), CA 2011 establishes the regulatory framework for charities in England and Wales. Guidance and policies produced, for example, by the Charity Commission for England and Wales (the Commission), HM Revenue & Customs ( HMRC), and Companies House are also influential across practice. In Scotland, the Charities and Trustee Investment ( Scotland) Act 2005 sets the parameters within which Scottish charities operate, including...

This Practice Note This Practice Note explores why an employer may issue an employee handbook or employee manual (also known as a staff handbook, staff manual or company policy manual). It sets out typical contents and how to present terms that must be reasonably accessible, covering disciplinary and grievance frameworks, holiday pay, sickness absence and pay, contractual and non-contractual policies, workplace rules and procedures, intranet publication, gender neutrality, the contractual status of policies, whether terms can be incorporated, permanent health ( PHI) and other insurance, and how to make changes or amendments. It also references the Lexis®Smart Precedent employee handbook and other relevant documents. Certain aspects of the employment and worker relationship must appear in a written statement of particulars of employment given to the employee or worker (see Practice Note: Written statements of employment particulars). Those particulars are often placed within the...

All websites should be accessible, especially by people with disabilities. Website access is regulated by the Equality Act 2010 ( Eq A 2010) together with the Public Sector Bodies ( Websites and Mobile Applications) ( No 2) Accessibility Regulations 2018 ( PSBAR), SI 2018/952. Those Regulations give effect to Directive ( EU) 2016/2102 (the EU Web Accessibility Directive) on making public sector bodies’ websites and mobile applications accessible to users. ( As EU‑derived domestic legislation, these Regulations sit within assimilated law and remain in force in the UK—see Practice Note: Assimilated law.) This Practice Note concentrates on UK-specific legislation and guidance relating to web accessibility across the sector. That said, organisations trading in both the EU and the UK should evaluate whether any additional or different compliance obligations may apply in their circumstances. In particular, they should note Directive ( EU) 2019/882 (the...

This Practice Note monitors the development of UK legislation brought forward under the legislative programme linked to the UK’s departure from the EU. It also features a Brexit SI database that compiles details of both draft and made secondary legislation related to Brexit. Quick links Use the links below to go directly to the relevant section or tracker. Practice area trackers Follow the links below for trackers focused on Brexit legislation across specific practice areas: Commercial Corporate Crime Dispute Resolution Employment Energy Environment Financial Services Information Law Intellectual Property Life Sciences Local Government Pensions Property R& I Tax For further updates and guidance tailored to individual practice areas, see: Brexit collection......

What is a Royal Charter? The meaning of the term ‘ Royal Charter’ has shifted over the centuries. At first, it was the method by which the Crown bestowed corporate personality on bodies of persons undertaking activities for public, or private, benefit. In contemporary use it largely signifies an honorary status, awarded to distinguished professional bodies or charitable organisations that can show a record of achievement and are regarded as financially sound by the Privy Council. The expression is also applied to municipal charters, which create towns and cities. Historical usage Securing a Royal Charter was the earliest route to obtain corporate personality for bodies of persons carrying out activities for public, or private, benefit. Key early grants included: The University of Cambridge in 1231 for public benefit; The Sadlers Company in 1272 for private benefit. Beyond educational institutions, such as...

Investment and trading Charities draw income in various ways, and it is essential to separate investment from trade. At times the boundary is hard to spot, particularly with land. If a charity buys land intending to let it for rent, that amounts to an investment, as the aim is to produce rental return. By contrast, purchasing with a view to resale—perhaps for development—at an enhanced price places them in trading, because the profit on disposal is the objective. Some may say that, while the land is held, it effectively operates as an investment and only becomes trading property when it is sold, but that characterisation is unreliable where the real plan is to sell on at a higher price... The deciding factor is the charity’s original intention at acquisition. As stated in Trustees of BT Pension Schemes & Others v Clark ( HM...

Under English law, binding agreements may arise orally, in writing, or by deed. This Practice Notice explores when a deed is required or preferable, and the formalities that must be observed to ensure validity. What is a deed? When a deed is required Formalities (1): in writing Formalities (2): face value Formalities (3): execution Formalities (4): delivery Escrow Witnessing Variation Failure to comply with formalities and other defects Reform For details on executing deeds in jurisdictions outside England and Wales, see Practice Note: Execution of deeds—jurisdictional guide. We have created a comprehensive, interactive collection to help users identify and navigate concepts and common issues in executing documents, including deeds. Each phase includes practical guidance, precedent clauses and Q& As relevant to that stage. For further information, see: Execution...