What to do when handling a client's estate with Jersey assets

Does your client own assets that are based in Jersey? Or are you dealing with an estate where the deceased owned assets that are situated in Jersey? Read on…

Jersey is a separate legal jurisdiction from the UK with a separate body of law and many clients do not realise this which can cause issues further down the line when it comes to administering their estate. We have all come across situations where the estate administration could have been made easier and less costly if the client had taken professional advice in the first instance. The law of succession and probate in Jersey differs significantly to that of the UK and creates responsibilities for the executors and administrators of those who leave assets in Jersey on their death.

If a person has Jersey movable assets, such as bank accounts, shares registered with a Jersey Registrar, shares in a Jersey company or shares in a foreign company that are held under a Jersey governed nominee agreement or declaration of trust, it is important that these are considered when thinking about their estate planning.

It is less common for a non-Jersey domiciled person to own Jersey immovable assets upon their death, due to the restrictions in place in Jersey regarding the housing market. The succession of Jersey immovable assets upon a person's death is governed by a completely different set of laws and procedures to those in place for dealing with Jersey movable assets, for example Jersey immovable assets are not dealt with by an executor, a Will covering Jersey immovable assets is simply registered with the Jersey Public Registry and thus takes effect and the title to the property passing under the terms of the Will transfers accordingly to the beneficiaries.

Care should be taken to ensure that a client who owns movable or immovable assets that are situate in Jersey has a valid Will or Wills in place to properly cover these.

In some circumstances, it might be better for the client to put a separate Jersey Will in place. If they own Jersey immovable assets – this would be the recommended course of action for the reasons outlined above. If the client owns Jersey movable estate then it might be a part of good succession planning due to the fact that the procedure for obtaining a Jersey Grant of Probate is very quick and efficient if compared to that in the UK or other foreign jurisdictions. Having a separate Jersey Will in place enables the Jersey assets to be released in priority to the rest of the deceased's assets and without the need to wait for the Grant to first be issued in the UK or for any HMRC clearance to be obtained. This can help hugely with the payment of any outstanding debts of the deceased such as an IHT liability.

If the deceased does not have a separate Jersey Will in place to cover their Jersey movable assets, and die with these in their sole name, a Jersey Grant of Probate or Letters of Administration must be obtained to have these released. It is not possible for a UK issued Grant to be directly used to release assets which are based in Jersey (unless they have a value of under £10,000 and can be dealt with under the small estate exemption procedure), so an application must be made for a Jersey Grant.

However, in 1998, a 'fast track' method of obtaining a Jersey Grant was introduced by the Probate (Jersey) Law 1998 (as amended) which enables a British issued Grant to a British

domiciled estate to effectively be 're-sealed' here in Jersey thereby reducing the time that it takes for a Jersey Grant to be obtained and the costs involved.

The fast track process is only available in estates where the deceased died domiciled in the British Isles, namely England and Wales, Scotland, Northern Ireland, Guernsey or the Isle of Man, and where a corresponding Grant of Probate/Letters of Administration has already been issued in that jurisdiction.

The application for a Jersey Grant via the fast track process must be made through a Jersey agent, such as a locally based lawyer, and the following documents would be required by the agent:

• The original British Grant of Probate (and attached sealed copy of the Will) or Letters of Administration. If the original is not available to use here in Jersey, then the Jersey Court can accept copy documents provided they are certified by the British Court or Registry that issued the original and that the seal of that Court or Registry is visible on every page.

• Copies of any other Wills, if the deceased left more than one.

• Translations of any documents into English, if required.

• A certified copy of the death certificate.

• Confirmation of the date of death value of the Jersey assets in the form of a copy of a letter or statement from the asset holder.

• Identification documents for the executors/administrators that are named on the British Grant.

Once the above documents have been received by the Jersey agent, an Oath is drafted to send to the executors/administrators to sign and this must be done in the presence of a suitably qualified witness such as a solicitor or barrister. The signed Oath should then be returned to the Jersey agent to enable them to make the application for the Jersey Grant. The Jersey Grant is usually issued within 3-5 working days of the application having been made to the Jersey Registrar which is an incredibly quick turnaround.

In the event that the deceased person was domiciled outside of Britain (and Jersey) but still left assets here in Jersey, the fast track process will not apply and the foreign estate application process will be required instead.

The application process for such an estate is quite different in that it requires the actual physical appearance in the Royal Court of Jersey of either the executor named in the Will, or the heirs/administrators if the deceased left no Will. This is not a factor that many people take into consideration when looking at their estate planning for Jersey situs assets as it is quite unusual. It means that if the executor was, for example, living in South Africa or Australia, they would need to fly over to Jersey in order to make the required Court appearance. Their other option would be to appoint a local agent by way of Power of Attorney, to make this appearance and apply for the Jersey Grant as the Attorney Executor (or administrator) on their behalf. It is usual, in this type of estate, for any Grant that has been issued in the country of domicile of the deceased person is re-sealed in Jersey before the Jersey assets can be accessed.

The documents required to make an application for a Jersey Grant via the foreign estate application process are more complex than those needed for the fast track process and can consist of Affidavits of Foreign Law and official translations of foreign documents into English. While obtaining these documents, depending on the jurisdiction of the domicile of the deceased person, can take time, the Jersey Grant, once the application is made and accepted, is still issued within 3-5 working days. The Jersey Grant is limited to the Jersey assets and is produced and used to access them.

In the event that the foreign domiciled person has a separate Jersey Will in place, this makes the process even easier especially if it appoints a locally based person or company as the executor thereof in the first instance. This means that the local executor can, upon receipt of the death certificate, go almost immediately to the Jersey Court to make the relevant application.

When making an application for a Jersey Grant via either process, stamp duty is payable to the Jersey Court under Article 5 of the Stamp Duty and Fees (Jersey) Law 1998. It is charged at the rate of 0.5% of the date of death value of the Jersey assets (which is rounded up to the nearest £10,000) on estates with a value of up to £100,000 and at a rate of £75 per additional £10,000 thereafter. There is also an £80 probate application fee payable in every case. There is a cap on the stamp duty payable, which is £100,000 so an estate will never pay higher than this sum.

The maximum stamp duty charge of £100,000 would be payable on an estate with Jersey assets that have a date of death value of £13,360,000 so any estates that are larger than this, take advantage of the stamp duty cap.

It is incredible how different the inheritance and probate laws of Jersey and the UK actually are. Non-Jersey practitioners can minimise complexities and delays by taking advice and guidance on Jersey law at an early stage. In most cases, the assistance of a Jersey lawyer will produce a cost effective and faster outcome.