Administering my fathers estate and debts...

[Jeffrey123]

My father passed away unexpectedly last month without a will.
He had very little in the way of assets - bank account, credit union account and a small ARF policy.
I will be helping my mother to apply for the grant of representation required. I understand that the first step of this is filling out the statement of affairs form online which asks for a list of assets and liabilities.

One of my siblings had loaned my Dad money a number of years ago and my Dads intention was for his ARF policy to be used on his death as repayment of this. This is something that my mother and all my siblings are / have been aware of - however there was no official loan document. Apparently Dad had signed something stating that the ARF was to be used to repay this but my Mam does not know what exactly this is or what specifically it said. I am assuming it is something he signed either with his broker or the provider of the policy so I will be checking with them. Either way I am assuming I should list this as a liability in the form even though there may be no documentation of it?

However I have only just become aware that apparently another family member (cousin of my Dads) has now also claimed that he is owed money. I have no information or proof of this - the cousin stated this to my aunt when she told him about my Dads death. Should I list this as a liability in the form or should I wait until / if this person provides proof of the loan? Would anyone know what exactly is required for someone to make a claim against the estate?

We had initially thought this would be a straight-forward process since we believed the only debt would be the loan to my sibling and it would just be a case of getting access to the ARF policy and other accounts and repaying this (which my mother/siblings are all in agreement with - there would be nothing left in the estate after this is repaid along with the funeral expenses - in fact the value of the estate is not actually enough to fully repay my sibling). Now I am not sure how this other persons claim may complicate things.

Maybe the best option would be to consult a solicitor - since the estate is so small I was hoping not to have to incur additional fees. Would anyone have an approximate cost to ask a solicitors advice?

 

[mathepac]

My condolences on your very recent loss and the consequential difficulties it has brought about.

Would anyone know what exactly is required for someone to make a claim against the estate?

Evidence that the loan was made, including a commitment to repay it. Without some form of agreement to repay, the "loan" might just have been a gift.

we believed the only debt would be the loan to my sibling

I think you mean "loan from your sibling" here. If that is the case, maybe you'd edit your post for clarity.

I'd think long and hard about involving a solicitor here as the estate seems so tiny. The size of the two potential debts might be a deciding factor for you, but remember, the debts may need to be satisfied and the onus to do that may fall on the personal representative.

I Am Not A Lawyer (IANAL, as they say on the internet).

mathepac

 

[Sue Ellen]

He had very little in the way of assets - bank account, credit union account and a small ARF policy.

Hi Jeffrey,

Welcome to AAM.

Sorry to hear of your father's passing and may he rest in peace.

You should check with the credit union if he does have an account as the insurance that they provide may produce some payments.

 

[TomEdison]

Ask the cousin for details and evidence of the loan — how much did he lend, when did he lend it, what was it for. what was the understanding about repayment? Ask if there was evidence in writing. Ask him to produce bank statements showing the payment out of the money to your dad. Explain that, as your Dad never told anyone about this loan (whereas he did tell people about the loan from your sibling) you will have difficulty paying it out unless it can be documented or evidenced.

Also ask yourself (and your family can ask themselves) whether, from your knowledge of your father, it is likely that your father would have borrowed money from his cousin and told no-one about it.

Your mother's duty as executor is to pay your father's debts, and you have to give creditors the chance to establish the existence of the debts, but it is up to them to establish them. In the end, you consider whatever the creditor produces and you decide whether it establishes that, more likely than not, your father did borrow this money. If so, then you repay the money. If not, you tell your cousin that you don't feel able to repay it and you give him an opportunity to take the matter further (i.e. institute court proceedings) before you distribute the money, if that's what he wants to do.