Rules of Intestacy
Why does Intestacy happen?
Many people still die without having made a Will or die leaving an invalid Will. When this happens the Intestacy Rules apply and a Grant of Letters of Administration may need to be applied for. An intestate Estate is governed by the Administration of Estates Act 1925.
So how does it get dealt with?
The person or people who apply for the Grant are referred to as Administrators and as there is no Will to prove their authority to deal with the Estate, their authority to act comes from the Grant itself. The order of priority to act as an Administrator is set out in rule 22 Non-Contentious Probate Rules 1987. The order of priority to act is very strict and once a person has been found with the authority, there is no need to go further down the line. The spouse or civil partner is the first authorised person to act (Under the Civil Partnership Act 2004 a civil partner has the same authority as a surviving spouse). Next in line would be children of the deceased and their issue and then the deceased’s parents.
Is distribution of the Estate the same?
The order of entitlement to an intestate Estate is the same as the order of entitlement to apply for the Grant of Letters of Administration and is set out by section 46 Administration of the Administration of Estates Act 1925. If there is only a surviving spouse or civil partner the administration is fairly simple as the whole Estate will pass to them. However, if the deceased has a child/children, this may not be the case. Can you imagine if the matrimonial home is in the sole name of the deceased and is worth over £250,000?
In this case, the surviving spouse/civil partner will inherit the first £250,000 as a statutory legacy with the remainder being split in half. One half passing to the spouse/civil partner immediately, the other half will pass on statutory trust to provide the spouse with income for life and thereafter to the children. Cohabitees and step children have no entitlement under the rules however they may be able to make a claim.
If there is a surviving spouse/civil partner with no children but parents and brothers and sisters, the surviving spouse/civil partner would inherit the first £450,000 as a statutory legacy, with the remaining half being equally split between the spouse/civil partner and the parents. If the parents have predeceased, this half would be split between brothers and sisters.
If the only living relatives are the children of the brothers and sisters then the entire estate would be divided equally between them.
Can I prevent Intestacy?
As you can see from the strict rules that have to be followed, it is strongly advised to make a Will to allow the testator to set out their own wishes, and ensure that he or she avoids the intestacy rules.
What should I do now?