Author Archives: Christopher Kelly

1. What will be your digital legacy?

   1st September 2017 3:35 pm Comments Off on What will be your digital legacy?

   Historically most of us would have stored our treasured memories in photo albums and paper diaries, physical items we could leave to our loved ones by way of our Will. Fast forward into the 21st century and hardly any of us still store our memories in this way. Today it is all about sharing our thoughts, feelings, memories and images online through the realms of social media such as Facebook, Twitter, Instagram and WhatsApp.

   So what really happens with our digital assets on death? Who owns this information and how do we ensure our loved ones have access to this?

   What is a digital asset?

   In the United Kingdom there is no legislative definition of what constitutes a “digital asset” but it is understood to be any information that exists in a digital form and this can be online or on a storage device.

   For example these include, but are not limited to, online photos, music libraries, social network profiles and email accounts.

   Ownership

   We do not necessarily own all of the data that we store online. When using many online services we regularly agree to that company’s terms and conditions without knowing what we are agreeing to and in many circumstances we are agree to restrict our use of digital assets.

   For example Apple’s terms and conditions state:-

   “You agree that your Account is non-transferable and that any rights to your Apple ID or Content within your Account terminate upon your death. Upon receipt of a copy of a death certificate your Account may be terminated and all Content within your Account deleted”

   This is the same for photos that we upload to social networking sites, such as Facebook and Instagram. It is therefore important to know who owns what so that our digital legacy can be managed.

   Safeguarding your digital legacy

   Our digital legacy is often something our loved ones will not know the full extent of and locating assets without a paper trail can be an horrendous task. It is therefore up to each individual to assist those we leave behind so that all of our digital assets are dealt with.

   So what can you do? We would suggest to:

   • Make an inventory of your digital assets. Ensure this is updated regularly and keep a hard copy with your Will.
   • Download any photographs or documents that are only stored digitally to an external hard drive or print out hard copies.
   • Leave clear instructions to your Executors as to how you would like certain matters/accounts to be dealt with.
   • Check the provider’s Terms of Use and service agreements for each account to see if it specifies what will happen to your account on your death and whether you actually own anything that your beneficiaries can inherit. Some providers have procedures in place and knowing these will help you to plan how these are dealt with on death.
   • Some websites make specific provisions for another person to receive data from your account after your death. For example Google Inactive Account Manager and Facebook Legacy Contact allow you to nominate another individual to receive some data from your accounts after your death. Therefore ensure your Executors know your wishes about how these accounts are to be dealt with and any particular message that you would like to leave to friends or followers on there.
   • Consider creating or updating your Will. Sentimental assets (such as digital photos stored on your computer) can be gifted under a personal chattels clause in your Will.

   These small steps can assist your loved ones with locating your digital data and help to prevent sentimental material from never being recovered.

   It is worth noting that it is not only sentimental material that can be lost. Digital assets can also include things with a real monetary value such as music, films, reward points and PayPal accounts etc.

   Be warned, many websites’ terms and conditions prohibit you from passing on you login details to other people. Therefore leaving a list of passwords can cause great problems for your loved ones. An Executor or family member accessing your account using your username and password after your death may be committing a criminal offence under the Computer Misuse Act 1990. For each digital asset, the Executor or family member should refer to the service provider’s terms and conditions.

   The bottom line

   The law is outdated and has not caught up with our digital lifestyle. With the terms and conditions for each company differing significantly there is no conclusive answer as to how your digital assets will be dealt with on your death.

   It is therefore vital that you start to plan your digital legacy. It is hoped that greater awareness will push companies into reviewing their procedures so that loved ones can access our memories and thoughts we share with the world today and close down accounts where other personal details are stored.

   If you would like to discuss any of the above issues then please feel free to contact us on 01245 504904 to book an appointment to discuss these in more detail.

2. Guide to Boundary Disputes for Landowners

   31st July 2017 2:32 pm Comments Off on Guide to Boundary Disputes for Landowners

   Understand how legal boundaries are determined, the possible defences to an individual case and what steps may need to be taken to resolve a dispute.

   Guide To Boundary Disputes For Landowners

   

   This Guide is intended as a general overview of the law in relation to Boundary Disputes. If you have any difficulties downloading this PDF file then please call 01245 504904. We would be very happy to email it, or put a copy in the post.

3. Guide to Agricultural Property Relief and Business Property Relief

   13th July 2017 2:52 pm Comments Off on Guide to Agricultural Property Relief and Business Property Relief

   Understand the types of relief available against Inheritance Tax, when they are available and their application.

   Guide To Agricultural Property Relief And Business Property Relief

   

   This Guide is intended as a general overview of the law in relation to Agricultural Property Relief And Business Property Relief. If you have any difficulties downloading this PDF file then please call 01245 504904. We would be very happy to email it, or put a copy in the post.

4. Obtaining Possession under the Deregulation Act 2015 – Implications for Residential Landlords

   5th July 2017 1:21 pm Comments Off on Obtaining Possession under the Deregulation Act 2015 – Implications for Residential Landlords

   All Assured Shorthold Tenancy Agreements entered into on or after 1 October 2015 are now caught by the Deregulation Act 2015. It is, therefore, very important that residential landlords are aware of the effect of the Act and its consequences on their ability to obtain possession of their property at the end of the tenancy agreement.

   The changes brought about by the Act relate to service of Section 21 Notices and a landlord’s ability to serve such a Notice. Landlords frequently say how much “red tape” is involved in obtaining possession of their properties, but the Act has introduced extra formalities that need to be adhered to before a valid Notice can be served.

   Landlords will be aware that the key to successfully obtaining possession of their properties is accuracy when drafting Section 21 Notices. However, the Act presents additional difficulties to landlords and lawyers alike, as it gives more scope to tenants to challenge the making of Possession Orders.

   So, what are the changes?

   A landlord cannot serve a Section 21 Notice during the first four months of the tenancy

   Gone are the days in which a landlord can serve a Section 21 Notice at the start of the tenancy agreement. This could prove problematic to a landlord who has granted a six-month tenancy and wishes to give notice to their tenant at the end of the period. In which case, a landlord would need to serve Notice on their tenant immediately at the end of the first four months.of the tenancy agreement.

   A landlord must provide the tenant with a Gas Safety Certificate, Energy Performance Certificate and Government “How to Rent” booklet at the start of the tenancy

   Failure to comply will result in the landlord being unable to serve a valid Section 21 Notice. This can be cured by providing the information to the tenant late but a landlord cannot retrospectively cure a Section 21 Notice that has already been served.

   The expiry date of the Section 21 Notice does not need to be the end of a rent month

   A simple two months’ notice is all that is required. But, obviously, the Section 21 Notice cannot expire before the end of the tenancy agreement.

   Prevention of retaliatory evictions

   This is of particular importance to landlords who have very difficult tenants and who wish to “spin out” the eviction process. Firstly, if a landlord has received a Hazardous Notice from the Local Authority in relation to disrepair, the landlord cannot serve a valid Section 21 Notice on the tenant within six months of them receiving the Hazardous Notice. Secondly, a Section 21 Notice can retrospectively be held to be invalid if the tenant complains to the landlord, and the landlord fails to respond to the disrepair issues “adequately”.

   “Use it or lose it”

   Previously there was no time limit in which to act on a Section 21 Notice so Notices could expire and then possession proceedings could be commenced by landlords, in some cases, years after expiry. Now the Section 21 Notice needs to be acted on and proceedings commenced within six months from the date the Notice is served on the tenant. Landlords need to be aware of this so they do not lose the opportunity to commence possession proceedings.

   A new format for the Section 21 Notice has been introduced

   A new form of Section 21 Notice must now be used for tenancy agreements granted on or after 1 October 2015, although the previous form can still be used for tenancy agreement entered into before 1 October 2015. Landlords must be aware of this so that their possession claims are not dismissed by the Court.

   A number of these changes will not pose any real danger to landlords when they are attempting to take possession, but landlords must nonetheless be aware of them so their claims do not fail when they reach Court. The biggest problem introduced by the Deregulation Act 2015, in my opinion, will be in relation to retaliatory evictions and tenants potential to try and raise disrepair at the property in order to obstruct the eviction process. For further information and advice please telephone me on 01245 504 904 or by email to jsandercock@leonardgray.co.uk.

5. Care Home Funding: What Next?

   30th June 2017 1:40 pm Comments Off on Care Home Funding: What Next?

   Going into the recent General Election, the Conservative Manifesto promised us “dignity and protection in old age through the right long term solution for elderly care”.  They went on to pledge:-

   • To maintain the Pensions Triple Lock until 2020;
   • To introduce a single capital floor set at £100,000 for the payment of care fees; and
   • To extend deferred payment for residential care to those receiving care at home.

   But what exactly did this all mean?

   The Pensions Triple Lock was introduced in 2011 and promises that the basic State Pension would rise by a minimum of either 2.5%, the rate of inflation or Average Earnings Growth (whichever is the highest). A recent report by The Institute of Fiscal Studies has stated that between April 2010 and April 2016, due to earnings growth being weak, the value of the basic State Pension has increased by 22.2% compared to growth earnings of 7.6% and 12.3% over the same period. This means that pensioners’ income has risen at almost double the rate of the average worker. This has obviously “cost” the Government who are looking to save money by replacing the Triple Lock with the Double Lock after 2020. The Double Lock proposal is to allow for the basic State Pension to rise by a minimum of either the rate of inflation or in line with the earnings that pay for them (whichever is highest). It is proposed that the “savings” on the Double Lock would then be used to help fund Social Care.

   Here the losers would be the pensioners drawing their pensions and living on a day-to-day basis but the potential winners would be those in need of Social Care. The promise to introduce a “cap” on care fees to protect assets to the value of £100,000 including the family home was a very popular move and potential vote winner for those already receiving care in a care home but would be detrimental to those receiving social care at home as their once exempt property would be included in the means test. Labour immediately dubbed this the “dementia tax”.

   Theresa May appeared to dramatically back-track on this during the campaign and, apart from stating that “ministers will work to improve social care”, it was conspicuously absent from the Queens Speech. The cynical amongst us would remember that the cap on care fees was promised before in the Conservative Manifesto of 2015 when the proposal was to limit care costs to a maximum contribution of £72,000 but this did not materialise.

   The deferred payment for residential care to those receiving care at home would, we are sure, be a relief to those who would prefer the comfort and familiarity receiving care in a home environment. It also provides the reassurance that they would not be forced to sell the family home to pay for care during their lifetime. However, it still means that payment of this care would come out of sale proceeds of the property once the patient has passed away. Once again, how much the care would cost in total depends entirely on the cap.

   At present, when an individual is assessed for Local Authority funding, the value of property, savings and income is all taken into account. Although there are certain circumstances (including if the property is occupied by a spouse) when the property is disregarded from the assessment. If, after the assessment, assets amount to more than £23,250 then the individual is assessed as being able to fully fund their own care until their assets fall below that threshold.

   It would appear that, for the time being, this situation will continue and without a cap on the amount to be paid above the threshold of £23,250. More information on the current rules and the options available to protect the value of your home from care fees can be found in our Guide to Care Home Funding and Home Protection Schemes.

   It has been announced that there will be a further consultation on care costs but when this will take place and what the outcome of this will be is unknown. As a result, it is fair to say that the future in respect of the payment of care costs remains uncertain.

6. Guide to Obtaining Possession of a Rented Residential Property

   18th May 2017 5:09 pm Comments Off on Guide to Obtaining Possession of a Rented Residential Property

   Understand the type of notice to serve on a tenant, the procedure for making a claim for possession and how to enforce a Possession Order.

   Guide To Obtaining Possession Of A Rented Residential Property

   

   Understand the type of notice to serve on a tenant, the procedure for making a claim for possession and how to enforce a Possession Order. If you have any difficulties downloading this PDF file, then please call 01245 504904. We would be very happy to email it, or put a copy in the post.

7. Guide to Shareholders’ Agreements

   4:36 pm Comments Off on Guide to Shareholders’ Agreements

   Understand the status, function and benefit to your business of a Shareholders’ Agreement.

   Guide To Shareholders' Agreements

   

   Understand the status, function and benefit of a Shareholders' Agreement. If you have any difficulties downloading this PDF file then please call 01245 504904. We would be very happy to email it, or put a copy in the post.

8. An increase in Probate fees: to be, or not to be?

   2nd May 2017 8:19 am Comments Off on An increase in Probate fees: to be, or not to be?

   That is the question.

   February 2017 saw the Government announce that there would be a dramatic rise in the cost of obtaining a Grant of Representation (more commonly known as a Grant of Probate) taking effect from a date to be confirmed in May 2017. For those that aren’t aware, a Grant is required after death in many estates to enable the Executors to sell or transfer assets and is almost always required where there is a property, bank accounts, shares or other investments to be dealt with.

   At that time we were advised that, despite overwhelming opposition during the consultation process to an increase, the current flat rate fee of £155 when obtaining a Grant for a client was to be replaced by a banded structure. Fees would be then be set based solely on the value of the estate.

   In the highest value estates, the increase in fees would be a huge 13,000%! Quite an increase in charges when the work involved for the Probate Registry is entirely the same, irrespective of whether the estate is of a high or a low value.

   The proposed new scale for fees was as follows:

   

   (Source: Ministry of Justice)

   As you can imagine, with the deadline of an increased Probate fee looming in May, it became hugelly important for us at Leonard Gray to prioritise Probate applications to ensure, where possible, that clients’ applications did not fall foul of the increase.

   Then something changed.

   It was Theresa May calling for a General Election to take place on the 8^th June which resulted in a lack of time for Parliamentary approval of the increase. So, on 21^st April, just two days shy of National Shakespeare Day, we awoke to find out that Probate fees would no longer be increased. To quote The Bard himself, “better three hours too soon than a minute too late”.

   Some may see it as poetic justice that what would have effectively been a stealth death tax had to be pulled so that we may have a stronger Government lead us through the Brexit negotiations. It does, however, remain to be seen whether this controversial increase will re-emerge after the General Election.

   But, for now, it would seem that it is a case of all’s well that ends well.

9. Claims on estates and the issue of Testamentary Freedom

   10th April 2017 8:48 am Comments Off on Claims on estates and the issue of Testamentary Freedom

   English Law has always recognised the concept of testamentary freedom. That is, the freedom to leave your estate to whoever you choose and having no legal obligation to provide for any particular person.

   The Supreme Court highlighted the significance of testamentary freedom and provided much need clarity in its recent decision of Ilott vs The Blue Cross & others regarding potential claims against an estate by disappointed beneficiaries.

   The brief facts of the case are that Mrs Ilott was the estranged daughter of the deceased, having left home at the age of 17 to live with Nicholas Ilott. The deceased disapproved of Mr Ilott and despite the couple later marrying, having five children and making attempts to reconcile with the deceased, they remained estranged. Mr and Mrs Ilott rent their property from a housing association and are in receipt of state benefits.

   The deceased died in 2004 and left a Will leaving her entire estate to Charities, excluding her daughter entirely.

   Mrs Ilott brought a claim under the Inheritance (Provision for Family and Dependants) Act 1975 (“the 1975 Act”) on the basis of a lack of “reasonable financial provision” for her. Mrs Ilott was awarded £50,000 at first instance. On appeal to the Court of Appeal this award was increased to £163,000, representing an award of £143,000 to purchase a property and £20,000 cash to provide an income.

   The beneficiaries under the Will, the Charities, challenged the decision and permission was granted by the Supreme Court who restored the first instance decision, awarding £50,000 to Mrs IIott.

   The following is a synopsis of points highlighted by the Supreme Court for such claims being made under the 1975 Act which are to be considered alongside the usual factors under section 3 of the 1975 Act:-

   • Long term estrangement is a significant relevant factor;
   • The deceased’s wishes and reasoning for the terms of the Will are relevant and need to be given suitable weight;
   • For adult children, reasonable financial provision is limited to “maintenance” and does not extend to everything that would be desirable for the claimant to have;
   • Reasonable financial provision can include the provision of housing, but ordinarily by creating a life interest (i.e. the right to reside in a property for a lifetime) rather than awarding a capital sum. By doing this you are not depriving the intended original beneficiary of the capital asset as they will receive this once the life interest has ceased;
   • State benefits are to be treated as a resource of any claimant and a Court must consider whether they will continue to be received; and
   • A claim cannot be decided by comparing the needs of the beneficiaries and the claimant. A beneficiary under a Will does not have to justify their entitlement.

   Whilst this decision goes some way in clarifying the factors which a Court will have regard to when determining the level of provision that should be made for successful claimants, some of the Supreme Court Justices were also critical of the current law in this area and its failure to give clear guidance as to balancing the factors under the 1975 Act.

   It is highly satisfactory from a Will drafting point of view that this case has now reinforced the value of the wishes of the deceased in their Will and testamentary freedom. However, we would always suggest that if you are planning to exclude a child, spouse, former spouse, partner or other dependant from your Will that you consider the following:-

   • What a Court may consider is a reasonable financial provision if the terms of the Will were contested under the 1975 Act; and/or
   • Leaving a small legacy which is to be forfeited if a claim is to be brought by the beneficiary; and/or
   • Writing a detailed letter of wishes, or even an explanatory sub-section in the will, explaining why you wish for those individuals to receive a smaller sum or be omitted altogether.

   These actions can often improve the chances of the estate reaching the intended beneficiaries as wished for under the Will.

   If you feel that any of the above issues may be relevant to your own Will and situation then please feel free to contact us on 01245 504904 to book an appointment to discuss these in more detail.

10. 34% increase in divorce fee!

    24th March 2016 11:45 am Comments Off on 34% increase in divorce fee!

    Last year, the Ministry of Justice consulted on a round of court fee rises, including a proposed increase in the court fee to issue divorce proceedings from £410 to £550. A 34% increase! Despite strong opposition, this increase has now been confirmed.

    Family lawyers only learnt that the fee increase would be implemented on Monday this week from an email received from the Law Gazette on Thursday 17th March – just a few days before the increase was due to come into effect.

    Jo Edwards, chair of family law organisation Resolution, said: ‘The stealthy implementation of the hike in divorce fees, from £410 to £550 (after an increase only two years ago) is scandalous and not backed up by proper impact assessment.

    ‘As a result of the steep increase, many people currently in the process of separating will have received incorrect information as to the charge for lodging a divorce petition and, in reality, won’t have time to get their petition in before the fee increase takes effect.’

    A spokesperson at the MoJ said: ‘Fees are never popular, but they are necessary if we are to reduce the burden of the courts and tribunals on the taxpayer. We have sought to protect the vulnerable at every stage. That is why we have a remission scheme to protect and help those who cannot afford to pay. These fee increases have not been brought forward; they are being introduced on schedule.’

    Unfortunately, however exorbitant the fee, couples wanting a divorce (unlike other court users) will have no option but to pay it.