Claims Against, and Removal of, Personal Representatives
| Author | Nasreen Pearce |
| Pages | 195-203 |
Chapter 14
Claims Against, and Removal of, Personal Representatives
14.1 INTRODUCTION
The role of a personal representative carries with it certain responsibilities and obligations, breach of which could lead to him/her being personally liable both in his/her role as a personal representative and for breach of his/her duty as a trustee. A personal representative can, however, take steps to avoid liability and, in some cases, provisions may be made to insure against such liability.
Where a claim is made against a personal representative for breach of his/her duties, it will also usually be accompanied by an application for his/her removal.
An outline only of such claims and liabilities and some of the steps that can be taken by the personal representative to avoid liability are set out in this chapter because a more detailed discussion is not within the scope of this publication. For more in-depth information, reference should be made to standard textbooks on the subject.
14.2 BREACH OF DUTIES AS PERSONAL REPRESENTATIVE
The primary duty of a personal representative is to collect all the assets of the estate, pay the liabilities of the estate and distribute the remainder of the assets in accordance with the terms of the will or the law of intestacy, as the case may be.
Breach of these duties which results in loss to the estate (often referred to by the Latin term devastavit) will have the consequence of making the personal representative personally liable for the loss. The grounds for a claim in devastavit will arise, for instance, if the personal representative has distributed the assets of the estate without taking steps to meet the liabilities of the estate or reserving sufficient funds to meet those liabilities; or made an unjustified payment for
196 A Practitioner’s Guide to Probate Disputes
which the estate was not liable; or paid a legacy or transferred assets to a person who was not so entitled under the terms of the will or the rules on intestacy.
14.3 WHO CAN BRING A CLAIM?
A claim may be brought by a beneficiary or a creditor of the estate who has suffered loss as a result of the breach/devastavit (see Re York (Deceased); Stone v Chataway [1997] 4 All ER 907. Similarly, where the assets consist of trusts, a trustee of the trust will be entitled to bring a claim in devastavit or in default of the trustee taking appropriate action, a beneficiary under the trust would be entitled to do so.
14.4 BURDEN AND STANDARD OF PROOF
The burden of proof lies on the person who brings the claim to prove the alleged breach by the personal representative in consequence of which the claimant has suffered loss. The standard of proof is the civil standard of proof.
The extent to which a claim may be made is limited to the actual loss caused by the personal representative’s actions or inaction. The loss suffered if any will be that which is assessed at the hearing and not when the breach occurred (see AIB Group (UK) Plc v Mark Redler & Co Solicitors [2014] UKSC 58).
14.5 WHAT STEPS CAN A PERSONAL REPRESENTATIVE TAKE TO AVOID PERSONAL LIABILITY?
14.5.1 Negotiate and reach an agreement
Where a personal representative believes that he/she may face difficulties with administering the estate of the deceased, he/she can take a number of steps to protect himself/herself from personal liability. The most obvious is to renounce probate, provided that he/she has not been involved in any wrongdoing, or to take out an insurance policy. However, it is possible for the personal representative to apply to the court for approval or directions on the administration of the estate. This situation is likely to occur where, for instance, he/she is unable to discharge his/her duty to distribute the assets due to outstanding or uncertain unquantifiable liabilities of the estate. In such cases, the personal representative may apply to the court for directions.
Before making any application to the court, it is prudent for the personal representative to consider carefully whether there are any other options available
to overcome such difficulties, and to bear in mind that issuing proceedings is a costly and time-consuming exercise loaded with delay and uncertainty, and may also result in a costs order if the court finds that the action was unjustified. One option would be to set up a meeting with the legatees/beneficiaries and inform them of the difficulties, and try to reach an agreement on how best to overcome them. Where the extent of the liabilities is clear and it is accepted that payment will need to be made, it may be possible for an agreement to be reached by all those who stand...
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