Summary 5

Summary 5

Area of law: Probate
Complaint reason(s): Costs information deficient, costs excessive, failure to follow instructions
Remedy: To pay compensation of £9,652
Outcome: Ombudsman’s decision accepted by complainant

Miss V was a beneficiary of her late partner’s estate, and the firm were dealing with the probate. Miss V’s partner had set up a life assurance policy, which meant that she would receive £500,000 when he died.

After her partner’s death, Miss V went to the firm, taking with her all of the relevant paper work. The firm told the life assurance company that then they were acting as executors. They also asked whether the payment would form part of the deceased’s estate, as it was not written in trust. The life assurance company responded, but did not make reference as to how the money would be paid out.

Miss V signed the claim form sent by the life assurance company and the firm gave their own details so the payment would be made to them. The firm also contacted the financial advisor who had set up the policy, as they were still unsure how the money should be paid out. The advisor said the policy was not written in trust, but didn’t say if the payment would form part of the estate or not.

The firm received the payment and it was added to the rest of the assets of the estate. Miss V asked if she would now be able to pay off her mortgage, but the firm delayed, stating they were waiting to hear back about the inheritance tax. Miss V went to see a financial advisor, to set up a new life assurance policy. Her new advisor contacted the company, who stated that the policy proceeds should have been paid to her directly, and should not have gone to the estate.

Miss V raised a complaint with the firm, but they maintained they had provided a reasonable service, as they had tried to establish the correct way of paying the life assurance policy to Miss V, but did not get the information they required either from the financial advisor who set up the policy or the life assurance company.

>Upon investigation, we decided that the firm had tried to find out how the money should be paid out, but still caused delays to Miss V. For this reason the ombudsman decided that that the firm should pay Miss V compensation for just over £9,500. This would cover the interest she had to pay on her mortgage (due to the delays in paying it off), the interest she lost as a result of not being able to invest the money, and compensation for the time wasted and inconvenience caused to Miss V during this period.