Stories from 2023

I thought it might be interesting if I looked back at my 2023 caseload and highlight some stories. What follows are all real live cases. Estate planning must work for the client and their heirs. One of my definitions of real love is to leave your affairs in a tidy manner. What follows are I think examples of this. If you have any questions, please contact me.

Robert Schon

T(DD:) 020 7267 5010.

E: rschon@streathers.co.uk

1) Writing a will for X; a sole director shareholder of a trading company

My concern was that if X died whilst still the sole director shareholder that the continuity of the business would be at risk with negative consequences for its staff, customers and the value of X’s estate.

If the company

  • Was incorporated on or after 28th April 2013; and
  • Had adopted the Companies Acts model articles including article 17(2); and
  • X (as sole shareholder) dies with a valid will

Article 17(2) allows X’s personal representatives to appoint a new director. NB it only allows the appointment of 1 director and only if the company has no shareholders alive.

In this case, the company was incorporated prior to 28th April 2013 and its articles had not yet been updated to include an equivalent provision to model articles 17(2). Fortunately, steps could be taken to amend the articles and ‘cover off’ the risk.

It vital that business owners and shareholders of private companies have a valid will and lasting power of attorney property and financial affairs in place and that in drafting these, consideration is given to understand what will happen to the business when X dies/ceases to have capacity.

2) Writing a will for Y whose assets include an Isle of Man (‘IoM’) offshore bond

I pointed out that Y had an estate outside the UK and we should enquire if for example

  • Probate would be required in the IoM on Y’s death; and
  • If it would make things easier if on Y’s death they had an IoM will?

Our enquiries resulted in Y being told that if Y, in their lifetime, transferred the IoM policy to a bare trust for Y’s benefit, on Y’s death the issuing IoM company would need only a copy of Y’s death certificate and a completed claim form for the proceeds of the policy to be paid to Y’s remaining bare trustees and so potentially be available to Y’s executors to help fund any Inheritance Tax (‘IHT’) due. Probate would not be required.

A bare trust has been put in place using the IoM company’s pro forma deed.