Solicitor claims overpayment of dad's estate

[GoddessMoon]

In November 2022, the solicitor dealing with my dad's estate closed our case and all money was distributed to the beneficiaries. The week before Christmas 2023, and the same solicitor - since retired because he is in his 80s ffs - contacted me via the firm in which he is still a partner, to say that they had overpaid the estate by over £8000. My thoughts are well, they wouldn't ask for this back if they didn't think they were entitled to it, but I think it is unfair if they expect us to pay back when the money has been spent (although in my case it is in savings - everyone else is younger and had plans!). I am the main beneficiary who received 55% of the estate.
Granted, when that final letter with all the costs came through, I only glanced over it and did not add anything up - they are professionals, right, I assumed they would have done their sums correctly. I signed and then the money was transferred.
I guess my questions are:

• are the legally entitled to this money back given the time that has lapsed? (I guess yes)
• Are they legally obliged to at least allow people to pay back in installments? I can pay mine back, albeit reluctantly, but the others are not able to.
• At the time of them finalising my dad's estate, I think one of their secretaries had gone on maternity leave and the place was in chaos. He says as much in his letter, that 'things were up in the air' in an attempt at an apology. I requested he leave the other beneficiaries out of the whole thing and to leave me alone until the end of January. Another letter arrived 3 days ago - the only letter to have been on time! in which he says we need to discuss the matter and that he will start to contact the others despite me saying not to do that because I have a suicidal niece who will most likely crack under this stress. Not to mention, none of the other beneficiaries have any money left over.

Any helpful advice is warmly welcomed, thank you.

I suspect they have a client account for all monies they hold for their clients. Their accounting system will then divvy that up between the people they hold it for.

The question is how they reconciled the books and bank when £8k down at the bank.

Send the problem to one of the money experts in a national
paper. The solicitors won’t want to see their name in print.

I'd ask for proof that the new accounts are indeed correct. I'd also state that as both solicitor and executor signed off on the accounts that unfortunately it is their error (if it is an error) and their responsibility to recuperate any funds missing. However, the money you was paid has now gone. You are willing to pay back £5 a week.

OP doesn't have the money, she has some of it and should pay that back (less perhaps a credit on the solicitors' bills?). The solicitors will have to go after the other beneficiaries for the other payments. If OP doesn't want her niece to be approached, she will probably either have to cover her payment as well or talk to other people in the family to see if they can help.

Quite. Given the "old school" nature of the old partner, I would suspect decrepit, manual systems and dodgy adding up are to blame.

It should, however, have been picked up on a client money reconciliation well before now (they are required to be carried out at least every 5 weeks), which suggests they are not (or at least weren't) following the rules. Despite what they say, your case may be the tip of the iceberg as far as the firm is concerned.

As soon as they identified the issue, the practice itself will have been required to rectify the shortfall, but are obviously now coming back to you to resolve it.

There really are two issues at hand here:

• the overpayment of the estate (check every number on the final accounts with a fine toothed comb - ask for evidence to numbers and/or access to their client file if it would be helpful); and
• their failures in handling your money

From the first point, unless you can prove otherwise, it looks like this should be repaid by the beneficiaries. It is unfortunately possible for the solicitors to request this. I am not sure what the situation is if people don't have the money to repay it. I would be using the phraseology of "we employed professionals so we wouldn't have to get involved with checking the accounts to the nth degree and we accepted the final payments in good faith that it was correct."

On the second point, however, I would expect to have a formal complaint go through their complaints procedure and referred to their Professional Indemnity insurers.

If you're still not satisfied with the outcome, you can then take it to the SRA.

@GoddessMoon

That is not good news and I agree with other posters you need to ask specifically exactly what happened. Are they also Executors or did you pay them to do the work for you? There IS a difference and it might make a big difference on what you can do about this. I would recommend that you maybe see a different lawyer ( or contact the Law Society) to discuss,

I'm also sorry to say that as you were an Executor you also had a duty to ensure that the accounts were correct before being signed off. You asked ''my husband is going through the 'accounts' now. But - it was a typo! That's not on me, surely?? '' and I think you will find it IS also on you. It's a bit late now, but never sign off on anything that you haven't read, even if you think it is OK. Being an Executor is a legal function and you can be held personally liable for mistakes.

Hopefully the Solicitors will have to take some of the 'loss' - but as I Say, you should really speak to a Lawyer or the Law Society

The laughable thing is that he is listed as the complaints handler!!

if they are ALSO executors, are they also not equally liable if paid out incorrectly?

also, was the Typo one that you could spot by redoing the maths.

Ie if they started with say £60k of assets rather than £65k, and then all the numbers after that were correctly added/taken off/split into shares, how would you spot that?

I can help you on this one. I work form a law firm in SRA compliance.

The law firm may or may not have breached the solicitors accounts rules depending if they have overdrawn client account. This basically means they’ve paid out more than they were holding on behalf of the estate from the client accounts (effectively borrowing money from other clients as it’s all pooled ) If they have not yet taken their fees and disbursements from the amount and this comes to more that £8k client accounts would not have been withdrawn.

If they have withdrawn client account they are not required to make a report to the SRA but this would have to be added to the breaches register which is reviewed on their yearly audit. They would have to put ‘right’ the mistake as soon as discovered ie replace the shortfall with their own money and put in place steps for this not to happen again. As long as this isn’t a re-occurring error they are unlikely to get more than a note on their audit.

You are required to pay back the money but they would have to take you to court for it. I would write and explain that the money has been spent and make a complaint on the basis of poor accounting records, poor advice and putting the benefactors of the estate in a bad financial position. I would suggest as a resolution that the firms professional charges plus vat are reimbursed from the amount owed. Explain that if you don’t reach a resolution that you will complain to the ombudsmen (this is what the ombudsmen will probably offer this as a solution)

Thank you. From what I can see, they may well have not taken their expenses out despite telling us at the time that they had. Not sure, need to read through everything - 3 documents as far as I can tell.

This x 10000.

BUT - OP I mean this kindly, absolutely you should have checked the accounts, you know that now though, and the reason for saying it is as others have said if you are the executor you have/had legal responsibilities.

I'm guessing you have a good enough relationship with the other beneficiaries that they will be sympathetic this wasn't picked up by the lawyers? There is definitely an issue with the lawyer's conduct here but you also need to protect yourself if the others freak out.

Do you have an email where the partner/whoever at the law firm said that there was 'no need to go through the payments' with the others? That's incredible guidance if so and flags him up as a moron/not looking after your interests.

I wasn't suggesting she has to pay the whole amount herself. She is only liable for that portion of the overpayment she has received.

Hi OP, without wanting to repeat what everyone else has said - raise a formal complaint before paying or agreeing anything, go to the Legal Ombudsman once the internal complaint is concluded. Simultaneously, report to the SRA for breach of the rules (they will investigate). You may eventually have to pay it (they'll accept installments if so) but the above steps will ensure the error is properly corrected and the firm held to account.

Even if he retired he should have some run off indemnity insurance (to cover negligence) insurance in place. I'd be contacting the SRA about this.

Indemnity insurance would cover any amounts payable to other beneficiaries or clients that cannot be paid due to this overpayment. It does not take away OP's liability to return any overpayment she received. If the insurers paid out, they would almost certainly come after OP for return of the overpayment.

I wasn't suggesting she has to pay the whole amount herself but it should cover the balance she hasn't received if they cannot recover from the other beneficiaries.

Either way I would still report to the SRA as the suggestion of the error being a one off limited to this file doesn't make sense because of that were the case, and client monies were not mixed or misallocated, then they wouldn't have been able to make the overpayment.

Edit button not working. Meant to say not suggesting Op is absolved from payment, but she need not pay the whole amount.

As executor are you also legally responsible for all overpayments?

Yeah, I'm quite prepared to pay my overpayment back. It just stinks that this is a thing in the first place and they ask me over 12 months later.!

Make a complaint to the legal ombudsman

This is absolutely correct.

I would ask for a portion to be off set against the fees you paid as you paid in good faith for a high quality service and evidence demonstrates this is not what you got. Also go to the ombudsman.