Posted: Friday, 24 April 2020 @ 14:16
There was quite an interesting piece last week in the Telegraph with the level of costs charged by solicitors on probate and how "lawyers are rubbing their hands in anticipation of a surge in fees of inheritance tax"and forthcoming changes. Frankly I am not sure if that is case with lawyers They may be more concerned in prepping up so that they know the law are not exposed to possible negligence cases down the road.
The article goes on to make some really longstanding points about lawyer fees including:
Lawyers’ fees are criticised as unclear and difficult to compare, with some firms charging by the hour and others quoting a fixed amount for all the work.
Research earlier this year by the legal regulator, the Legal Services Board, found that just 16pc of firms that dealt with wills and estate administration displayed their prices online. The data also showed that hourly rates varied wildly, from £50 to £375, while among firms that charged set overall fees the maximum charged was £8,750 while the minimum was just £150.
But such prices are at the lower end. Many firms charge far more and it is not unheard of for estates worth between £1m and £2m to attract settlement fees of £60,000 or more.(not sure about the latter point but nice money for the lawyer if you can get it)
In my view the lack of confidence of the public in legal pricing has encouraged some executors to go alone without legal support or use telephone support services, including my former employer, Which?
As the article goes on, the risk is that an executor could find themselves personally liable if errors arise. More commonly, missing out on inheritance tax reliefs or miscalculating the liability could mean overpaying tax and the executor can be legally exposed.
My view is that acting as a DIY executor is fine if the estate is straight forward and one can emotionally handle going through the bereavement process. Difficulties stem on more complex estates or overwhelming family circumstances.
The trick is recognising one's limitations and having the ability to take good professional advice when things are getting/can get ropey.
I find myself sometimes picking up the pieces of a DIY executor who either does not understand what is required and is simply out of his or her depth - This creates a minefield and then it is up to someone (be that beneficiary, relative or a professional) to plot a path back to a sound footing. Once it has gone wrong, very difficult.