Who would inherit in this scenario?

[Nameychangeee]

No will.

2 DC that are still young children.

In a relationship with DC’s mother but not married. DC’s Mother a SAHM - financially dependent.

All live together.

1 parent still alive but in her 70s.

DC’s mother named on life insurance policy and pension.

Own a house with a small mortgage on entirely in their own name.

Who would inherit everything in this scenario?

House alone is way over the £270,000 threshold but still has a mortgage on it.

Please no comments stating “get married!” as this isn’t relevant. I just want to know who would inherit - I am sure this must happen quite often.

I know it should be DC to inherit - but who would “look after” the money/house etc until they were 18?

I would imagine it’s not a particularly rare scenario for a parent of young children to die whilst be unmarried without a will though.

Hmmm…. But in a lot of cases, the parents will own the house jointly even if they aren’t married.

The man in question could make a will even if he doesn’t believe in marriage. By not doing so, or by other paperwork such as NOK forms, he is by default leaving his own mother as his next of kin (which might also mean she had medical say in the event of serious injury etc)

The man needs to make a will otherwise when deceased, his parents will be NOK & have responsibility for the estate until the DCs turn 18.

The DC's mother would need to go to court to change that.

Most people make wills at milestones. Buying a house becoming a parent.

His next of kin would probably be appointed by the courts, but they don't HAVE to be, the DC mother can apply.

Or the nok can do the estate admin then hand over the trust to someone else - I'm trustee for my niece but when the next chunk of money comes I'm handing it over to my nephew because I don't want to do it.

The pension nomination is an expression of wishes only - it is very likely the trustees would award to the children as well as the partner, rather than all to the partner. This will most likely fall outside of the estate.

Is the life insurance policy a workplace benefit, or his/her own policy? If the latter, need to know more about how the partner is named as a beneficiary because this would suggest its either been placed in trust, or ownership of the policy has been assigned to the partner.

The person named on the life insurance policy will get the insurance. The next of kin will receive the sale of the house etc, so ghetto dc if you're not married

Why not just make a will?

FFS people make life so complicated for themselves when it’s just not necessary. And to then not have a will and to leave your assets to be sorted out by lawyers and NOk when you die is just so bloody selfish. But hey you’ll be dead and it won’t be a problem will it?

It's really unfair on the kids for the parents not to sort this out.
It is simple to make wills.
It's also stupid not getting married from a tax point of view if the house is already worth a million.

Currently when the man dies everything over 500,000 will be subject to inheritance tax assuming he leaves the house to his kids. Thats such a waste of money.

The woman is also being foolish for not working in this situation. What if the man changes who he wants to leave his pension to? It's not hard to do.

It is possible - since the OP has said getting married isn’t an option - that the man is already incapacitated in some way so that it is not now possible to write a will.

Lots of people don’t, sometimes because they have misconceptions that the law will do the “ common sense” thing even if they don’t.

"However who would be in charge of looking after the money in trust for the children? Would it be the woman or the man’s mother who is in her 70s?"

There is a specific order as to who can apply to be the administrator of an intestate estate. This is set out by Rule 22 of the The Non-Contentious Probate Rules 1987.

https://www.thegazette.co.uk/all-notices/content/104036

The list is:

1. Spouse of civil partner
2. Children of the deceased, which also includes adopted children and those born outside of marriage.
3. Parents of the deceased
4. Full siblings who share the same parents (or their children)
5. Half siblings who share one parent (or their children)
6. Grandparents
7. Full aunts or uncles (or their children)
8. Half aunts or uncles (or their children)

So, it is the children that can apply to be the administrator of the estate before the parents can.

However, in the case the children are under 18. So what happens then?

Well, in the event of minor children, who, but for their age, would be entitled to act, then the person with parental responsibility for the minor(s) would be entitled to take out the grant of administration on their behalf.

This comes from Rule 32 of the Non-Contentious Probate Rules.

In addition, the person with parental responsibility may also nominate a second person to act with them as well (as long as the other person is a "fit and proper person").
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So, to sum things up, the children (or just one of them) is the person who is entitled to apply to administer the estate.

However, since they are under 18, then the person with parental responsibility can apply on their behalf to administer the estate for their benefit until they reach the age of 18.

"However who would be in charge of looking after the money in trust for the children? Would it be the woman or the man’s mother who is in her 70s?"

It would be the woman. Unless she chose not to act, in which case it would then be down to the mother as she is next on the list after the children.

You are mistaken. That's not how things work in England & Wales

You could say why not just get married? You can do it for about £100 and save all this stress. If it was about the fear of one partner claiming assets in divorce, you can make financial arrangements for that.

It's common but very silly for women to have kids and become sahms without the protection of marriage. You're entirely dependent on goodwill and health of partner.

In this scenario, even with mortgage paid off and right to stay in the house, the woman might struggle with council tax, utilities etc without a regular income.

@Nameychangeee

"Would money from the trust be able to be used to the DC’s upbringing?"

Sorry, I forgot to answer this question.

The answer is yes.

This is from the HMRC about this:

TSEM6121 - Legal background to trusts & estates: early payment of a minor's share under the rules of intestacy

Under a statutory trust each child of the deceased receives a share of assets on reaching the age of majority, or on marriage if that is earlier.

Trustees can provide for the maintenance and education of a minor beneficiary. If there is not sufficient income, they can make advancement from capital.

Trustees can advance up to half of a share to a minor beneficiary, if they think that is appropriate.

https://www.gov.uk/hmrc-internal-manuals/trusts-settlements-and-estates-manual/tsem6121

So, you can use up to half of the money for maintenance of the child up to the age of 18

The rules are not set up for people who just live together and chose not to make a will. When you say it is likely to be common I would think most people in that situation would make a will and it is moderately unlikely the children will be under 18 when one of their parents dies, more likely if the man is much older which is quite often the case I suppose. Assuming both parents are on the birth certificate each parents estate will go to the children (under English law). I would think the surviving parent would be the obvious choice to look after the children and the children's interests if they were living as a family. I guess it could be challenged in court if the surviving parent wasn't suitable and the court would then decide.

Both of them should make a will, to make sure things are settled how they wish.

But, of course, what has not been mentioned here is the Inheritance (Provision for Family and Dependants) Act 1975.

This also applies to unmarried partners as well. As long as they were cohabiting for two years immediately up to the date of death and was being supported by the deceased then the unmarried cohabitee can bring a claim against the estate for reasonable provision.

Now, in this case, it would mean the woman (as cohabitee) bringing a court case against herself (as trustee of children's trust) which would be rather pointless.

But, in other situations, it is something to consider. For example, there is the case of Negus v Bahouse

Negus v Bahouse [2007] EWHC 2628 (Ch)

In this case, Ms Negus cohabited with Mr Bahouse for a number of years but they never married.

At the time of his death, Ms Negus was not included at all in his will (it had been written before their relationship began and he never updated it) but she was named as a beneficiary on his life insurance policy.

His net estate was valued at £2.2 million and she was awarded a total of £835k, or around 38% of his estate. The rest went to his son.

The son later appealed this decision but the appeal was rejected.

Thank you! Your advice has been super helpful.

This happened with my friend recently.

It was his son (primary age) that stood to inherit with his mum having to manage it

Having had to deal with the estate of someone who died intestate, and found 40% of people don't have a will, please get them to make a will, even if they don't want to marry.

Yes a cohabiting partner can claim a percentage of the estate, yes the children will inherit. But death is a lot easier if you are the legal next of kin and if you have a will. It will save time and a lot of money through the whole process.