When Bob Maddams agreed to be an executor for his brother’s estate, he didn’t expect to still be dealing with it all three years later.
John Patrick Maddams, who died at 72 in October 2022, had been meticulous in planning his legacy, leaving three buy-to-let properties and his main home for his daughter, Cecilia, as well as numerous gifts to charities.
“We were close. We enjoyed eath other’s company and I was a live-in, full time carer for the last six months of his life until he died in a hospice,” said Bob who was six years younger than his brother, who was known to most people as Patrick. They grew up in north London.
The elder brother had worked in various jobs in law and banking, including serving as the managing director of the Royal Adacemy of Music in London. His estate was initially valued at just over £1 million — but three years later it is valued at half that. There were two executors of the will: Bob, 68, and a woman in her late eighties who is a full-time carer for her husband.
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An executor is legally responsible for carrying out the instructions left in the will and distributing the money and assets of an estate. They have to to apply for a grant of probate to deal with the assets and to settle any liabilities and liaise with HM Revenue & Customs over any inheritance tax owed. It is not a role to be taken lightly.
Patrick Maddams, a former managing director of the Royal Academy of Music, owned several buy-to-let properties and a mortgaged house
For Bob, a former film-maker and freelance journalist from Lincolnshire, it was a steep learning curve. He said: “Executors are left hanging in the wind despite the best efforts of probate solicitors. It is a massively complicated process for which executors have all the responsibility and none of the experience of training. They don’t teach you this stuff in film school.”
‘I couldn’t get at the cash to pay the mortgage’
When Patrick died all his bank accounts were immediately frozen, but there were multiple mortgages to pay and rental income to collect on three buy-to-let properties.
Bob was told to open a specialist probate account to handle all the financial transactions, but struggled to find a high street bank offering one: “I tried all the leading banks,” he said.
“You find yourself in a position where you have all these financial responsibilities and a frozen bank account and no way of handling them.”
Bob had a dormant personal account that he was able to clear out and use instead. “Everything is compounded by the fact that every time you do something in this process, you have to learn it from scratch,” he said.
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The house his brother was living in was initially valued at £625,000 and put on the market. It didn’t sell and, because of the outstanding £250,000 equity release mortgage on the house, has been repossessed by Canada Life. The lender has put it back on the market with a guide price of £350,000.
Two of Patrick’s buy-to-let properties in London had cladding issues, so they could not be sold until remedial work had been done. This was finally signed off in September, but two offers have fallen through.
‘The tax bill was based on a value that has disappeared’
Inheritance tax on an estate is due within six months from the end of the month of death, after which the taxman starts charging interest. Bob said HMRC had calculated the inheritance tax due on the property based on the initial valuation and not the amount it was now being marketed at.
The estate is paying the tax bill in instalments, and will not be able to settle the full amount until the property is sold. Bob has been using the rental income from Patrick’s other properties to cover the inheritance tax payments, but does not know how he will pay the tax due on the rent. “I can’t afford both,” he said.
While the bill remains unpaid, it is also accruing interest. From Friday, the interest rate on unpaid inheritance tax bills will be 7.75 per cent. The interest rate HMRC pays taxpayers who are owed refunds is 2.75 per cent.
“It’s a two steps forward, one step back process,” Bob said. “Every stakeholder in the process, apart from the probate solicitor, that you deal with is an online platform. They all operate differently, it takes ages to learn how to navigate each one, helplines are often lists of general questions and answers that don’t address your concern, and there’s never anyone to talk to.”
‘One executor is being sued by beneficiaries after a water leak’
Jade Gani who runs the law firm Circe Law and is chair of the Association of Lifetime Lawyers, said she sees similar situations all the time.
“Unless you are a solicitor or a lawyer, you’re not going to have dealt with this before, and it can become extremely complicated.”
One executor she has been helping did not realise she had to get vacant property insurance and drain the water system in the house. In the cold weather, the pipes burst, and now the other beneficiaries of the estate have a claim for the £25,000 damages against her as the executor.
The court holds executors to a high standard and there is little defence if something goes wrong or if a beneficiary brings a claim, and you cannot claim that you simply “didn’t know”.
It is not a legal requirement to ask an executor for their permission before you name them in your will, but it is possible to decline the position.
Gani said: “A lot of people view it as being able to do one last thing for the person they love. They feel they are being trusted with that person’s final wishes.”
She recommended people talk to their chosen executors in advance and said that executors could approach specialist lawyers for advice at the start of the process. Administering an estate can involve a lot of time, work and stress, so anyone considering accepting the role should be confident that they can do it properly.
Bob said probate was “one unholy, complicated, not joined-up mess. It’s incredibly stressful, upsetting and given that hundreds of thousands of executors will have to go through it every year, totally unacceptable.
“Would I do it again? Only very reluctantly and only out of a sense of family duty. How can you refuse a family member? Luckily it’s unlikely to happen as there is only my niece as a close family member now.”