The executor of a Will has a hefty responsibility. As the person who must make sure that those entitled to benefit from a deceased’s estate do so, he or she must sometimes handle some tricky situations – not least of which is when a beneficiary can’t easily be tracked down.
It’s not the norm. In most situations, it will be close relatives that stand to benefit from a Will, and those people will usually be on-hand. (When you’re making a Will, include and keep up-to-date as much detail as possible about your beneficiaries; full names and addresses can make the executor’s job far more straightforward.) However, when relationships drift and people lose touch with one another, there is a good chance that the executor will have to invest some serious time in trying to find any ‘missing’ beneficiaries.
This is a legal duty. An executor must take reasonable steps to contact a beneficiary. If that’s not done, the executor could be personally liable to pay the beneficiary what they were due under the Will. It’s a situation that no executor would want to find him or herself in, and many come to us for advice on what to do.
The first, and most obvious, step is to ask around. Family and friends of the deceased are sometimes able to help track down the beneficiary. If that doesn’t work, an advert in relevant newspapers – usually where you expect the beneficiary or others that might know them to be living – is a sensible next step. If that proves fruitless, it might be worth investing in a tracing agent, but perhaps only if the value of the estate would justify that cost.
We have advised on a number of situations in which a beneficiary simply can’t be found. Once all reasonable efforts have been made, it’s time to draw a line. The administration of the estate can’t be delayed indefinitely, so the executor must bite the bullet and move on. But we always advise putting in place some protections to avoid facing personal liability in the event that the beneficiary turns up – which can happen.
There are various options:
- A reserve fund – hold some money back to pay to the beneficiary.
- An indemnity from other beneficiaries – they agree to pay the ‘missing’ beneficiary’s share.
- Insurance – some companies will cover the beneficiary’s entitlement.
- A court order – the court gives permission to distribute the estate based on a presumption (usually that the beneficiary has died).
Each of those options has pros and cons, and will be more suited to some situations than others. One of the big considerations is the value of the inheritance due to the beneficiary. Not only will that be relevant to the reasonableness of the steps taken to find the beneficiary, but it may mean that the cost of one or more of the protective options is disproportionate.
The good news is that far more often than not, estate administration is relatively straightforward. That is particularly so where the Will is clear and unambiguous and gives plenty of information about future intentions. For the executor, it’s a case of working through each stage of the process – and if that involves having to try to track down someone who has ostensibly vanished, then so be it.
The outcome may not be the one the executor had hoped for; sometimes a beneficiary simply can’t be traced and there’s a degree of uncertainty for years to come about whether or not they might at some point show up looking for their inheritance. As long as the executor is happy that he or she has explored all available options when it comes to trying to contact the beneficiary, and has got some protection against personal liability, there is not much more that can be done. And, ultimately, the executor will be able to say that they took their responsibilities seriously and did their very best.