In September, Lynton Stock, the senior partner of accountants Shelley Stock Hutter argued on these pages that accountants are best equipped to deal with uncontested probate work. Here, Sally Harlow, a solicitor specialising in probate at law firm Boodle Hatfield responds, by saying there is a very good reason why lawyers remain the first choice for probate work.
Lawyers have been at the heart of probate work for centuries. It is not just because they may have drafted and stored a Will, but because even the simplest estate may require additional legal documentation to be drafted and ongoing legal advice. Probate is much more than a financial exercise.
An uncontested probate might at first glance seem quite straightforward. The executors value and gather in the assets of the deceased, settle their liabilities, pay any inheritance tax that is due, and then distribute the estate. But that is not always the case.
Many estates, even those with modest value, will often include some form of trust. This might be because of a second marriage, with assets held in trust for the children of the first marriage whilst allowing the second spouse to use those assets during their lifetime. Alternatively, many Wills still include a nil rate band discretionary trust, commonly used before the introduction of the transferable nil rate band and appointments from these trusts are often required as part of the probate work. The legal documentation to deal with these trusts is prepared by the solicitor. The solicitor might also continue to act for the Will trustees if they require assistance with ongoing trusts once the administration of the estate is completed.
A straightforward uncontested probate might also contain areas of tension and potential conflict between beneficiaries, often in relation to unexpected items such as chattels. A solicitor is often useful in such cases, being able to advise on the options available to the beneficiaries and ways to prevent the potential conflict from escalating.
It may also be that beneficiaries wish to amend the terms of the Will (or the rules of intestacy if there was no Will). This might be to provide for someone for whom no provision has been made, to move the deceased's assets into a trust, to reduce inheritance or capital gains tax or simply to clear up any uncertainty over the Will. The documentation to put such variations into effect will also have to be prepared by a solicitor.
Solicitors are well-used to the various documents and the legal framework surrounding them – they use them day-in, day-out – and will be aware of the potential traps and pitfalls.
Probate solicitors, even in some of the most complex estates, will also draw up the estate accounts. It is again something probate solicitors have been doing for many years, and is now made easier and quicker by specialist software readily available.
And with new technology, the cost of probate work is falling. Yes, there are still some law firms that charge for probate work based on a percentage of the estate, but, like accountants, most will charge an hourly rate or even a fixed fee. Executors should discuss with their solicitor, or accountant, at the outset how they intend to charge, and ask for a detailed fee proposal.
That is not to say that solicitors do not work alongside their accountancy colleagues. Solicitors will often ask accountants to review or prepare an individual’s final lifetime tax returns or the estate tax returns if the accounting issues are complex. The accountant's contribution is often invaluable.
The most significant threat, however, to probate solicitors and the work they do is not from the accountancy profession, but from the rise of alternative providers, such as Co-Op Legal Services. They are often well-resourced, have a national brand presence, operate on fee arrangements, and have made a significant impact on certain sections of the probate market.