Changing a trust - complicated family

[volvomom45]

I'm sorry - this may be quite long but am looking for some advice please MN legal experts!!

My DF passed away 18 months ago. He was married to my stepmum who I feel hugely indebted to as she cared for him in his last years when he was unwell. We have always got along and I care for her very much. She and my dad owned a house which she continues to live in. I am an only child and my stepmum has two daughters; all of us adults and were adults when they married so were never brought up by our stepparents IYSWIM. I dont really have a relationship with either of my stepsisters and never have as we live in separate parts of the country.

My DF Will put his share of the house in trust, and as things stand when DSM passes away, 50% of the house proceeds will pass to me; 25% to each of my stepsisters. It has recently been brought up that prior to his death, DF and DSM agreed that this wasnt a fair split and that they had intended to change the will to reflect that each of us receive 33% of the proceeds. There wasnt enough time to action that before he died; and he and I never spoke about whether this was discussed. The house isnt worth very much - we are not talking about millions of pounds.

I am now being put under some pressure to agree to sign a declaration of trust to reflect a new 33% split of the proceeds of the house upon DSM passing away. I know that legally I can say no; but in my heart it feels that an equal share between all 3 of us is right and fair. I know my DSM is keen to ensure her children are treated equally to me when she passes and as I say, I feel hugely indebted to her so I dont want to cause undue stress over this.

The main complication for me in this, is that all of the above is being proposed via a solicitor who works at the firm as one of my stepsisters (SS1). My hunch is that there was never a conversation about this prior to my dad dying and that all of the above has stemmed from/is being pushed for by SS1 who (not wanting to do a massive drip feed!) does not have a great track record with money; was not a fan of my DF and has long manipulated and gaslighted my lovely DSM.

Whilst I feel that 33% each is a fairer split; I am nervous that this is all being handled by a colleague of someone who will directly financially benefit - it just feels off to me. I am reluctant to instruct my own solicitors and incur a load of fees to ensure it is all done above board when I am already standing to lose out financially. I am also not clear if there are any additional implications of breaking or changing the existing trust that has been set up - eg. if my DSM were to require proceeds from the house to pay for future care home fees; whether there are any tax implications for changing the trust etc etc. As I say the house is not worth that much and I worry about spending hundreds/thousands on the legal work needed to change the % split.

Any help or advice MN'ers can give for moving forward with this tricky situation would be great!

In theory only your Dad’s 50% share is protected. If your DSM share is spent on care that is all there will be left.

How would your Dad feel if you have them 66% share of his half to them?

I wouldn’t agree to this. The fact that your Dad went to the trouble of sorting out a trust shows that he had given the matter thought and wanted you, his only child, to have his share of the property. Its also the accepted and normal way for inheritances to work when there are blended families. I don’t understand why your heart thinks an equal share between the three of you is right and fair.

If the house was largely funded by your step Mum then maybe you could think about an even 1/3 split but otherwise I wouldn’t entertain it.

I don’t think it’s relevant that your step sister is not a nice sounding person as I would say the same even if she was nice.

I know it would be awkward to decline but maybe you could just say that you don’t want to commit to anything for the time being but that you will look at again in future. ( ie just keep pushing it along).

Why is one third a fairer split? You inherit your father's share as he planned and as an only child. Your SM's children get to share her half. This sounds totally fair. And it sounds like that was what he wanted. Some people are just grasping.

Do not sign. You are your DF's direct descendant and it is entirely appropriate that you inherit his share.

@volvomom45 pp are correct. I agree this is the recommended approach for blended families. As it’s 18 months since your Dad died they are pushing for you to do the deed of variation now because it has to be within 2 years.

I certainly would wait until your Stepmum passes away. No one can predict the future and it’s perfectly reasonable to say it’s not appropriate to discuss it now.

I would also take a step back and think about other scenarios. If you had a sibling their suggestion would see you all getting 25%. However, if you had two siblings so the split was 20% each with the SS jointly getting 40% do you really think they would suggest this?

Sadly inheritance and money can bring out the worst in some people.

You haven’t mentioned your Mum, did she contribute to the house? If so then part of the 50% comes from her.

Agree with PP, it’s fair you receive your 50% share. I’m also surprised your DSS’ firm agreed to act, it’s not going to be worth a lot of money to them and there is potentially a conflict there. In my opinion, if you were to proceed you’d need to engage your own lawyer or ask a third party lawyer if they’d be willing to act for all parties in the circumstances (which I think is unlikely).

"I am reluctant to instruct my own solicitors and incur a load of fees to ensure it is all done above board when I am already standing to lose out financially."

You don't need to do this at all.

"I know that legally I can say no;"

To quote no end of previous MNer's, "No is a complete sentence".

You simply say "No". You don't have to do anything else at all.

"but in my heart it feels that an equal share between all 3 of us is right and fair."

Then, with all respect, your heart is wrong in this case.

Your dad wanted you to have half of the house. He specifically got a lawyer to right that into his will.

Do you really want to go against what your dad said to a lawyer that he wanted to happen?

Thank you all for the comments - it’s given me a lot to think about. I honestly didnt expect so many of you to say that the 50/25/25 share is more appropriate but it’s true that there is no way this would have been raised if I had two siblings and that is not something I have really considered so far.

In all honesty I don’t know exactly who put in what when the house was purchased - my sense is that my DSM contributed more but my dad had also inherited around that time so it’s not like it was an outright purchase by her.

If this had been on your Dad’s mind before he died he would almost certainly have spoken to you about it, op?
You talk about your indebtedness to your Step Mum, but it’s not about her, it’s her kids who will actually benefit from this little scheme.
I’d be really sceptical that it’s coming from her; she was happy to set up the trust as it has been.

is it set up in his will so that she has a life interest then his share to you? And step mums would go straight to her children? Or each of your dad and step mum specified 50% you, 25% each of step sisters? The trust is protected from being taken into account for any care home fees she may need also. The danger if it’s the first option is that you vary your trust to get a third of that half (instead of the whole of that half) and they then inherit the other half between them. So you only end up with 1/6. Even if the second option, step mum can change her will at any time to leave to her own daughters and you will only have what is from your dads trust.

Your SS sounds like she’s being very crafty. I appreciate it’s difficult because you do care about your DSM but you have no way of knowing if this is really what your DF wanted. I would resist signing if I were you.

You should go with your DF's wishes as stated in his will. The end.

Another one here to say you should abide with your DFs will, which is also a very fair will. Someone is being a cheeky sod - and I’d guess that someone is your stepsister.

If your father had wanted something different surely he would have told you. Your father put his wishes in writing so please adhere to his wishes
As others have said ... you could end up with 1/6th if SM needs care.

50% to her children, 50% to your Dad’s is completely fair!

Say no. You say you don’t see them so should be fairly easy. You could agree to all of this and then SM changes her will so that you get 1/6 of the house (1/3 of your dads half) and SSs split 5/6 (2/3 of your dad’s half and all of your SM’s half). Would your dad have been happy with that?

Something similar happened in my family: Step parent went back on their agreement and changed their will last minute so that the first family got nothing.

When SM dies , if you’re feeling generous, you could always make a cash gift to SSs. If your estate is currently below the IHT threshold and will be for the next 7 years then there should be no tax implications (Chartered Tax Adviser before people pile in to give incorrect tax advice).

Agree with everyone saying stick with the current arrangement, as your DF wanted and which is a fair split. No one should be putting pressure on you to do anything other than what was in the will. Your suspicions are probably right but there's no nice way to get into that and no way you should override your concerns and go along with whatever they want to keep the peace. The clearest and correct route is to nip this in the bud and say you're sticking with the trust as it was set up and that's the end of it, as it should be. If they pressure you any more then that is very unreasonable of them and tells you all you need to know.

Your gratitude to your SM is a separate matter and can be reiterated but it's nothing to do with this, your father's will, which he put thought into doing this way and could have changed or told you about it if he'd really want to. Some last minute rethink that he never spoke to you about is very unlikely, as opposed to the daughter angling for it when he's gone and you're feeling vulnerable and outnumbered.

It’s not clear whether your dsm owns half the house, or if your df owned it all? If the former surely the step sisters will each inherit 25% of the value from their mum, plus 12.5% from your df - 37.5% each, leaving you with only 25%

If he owned the whole lot, then tell them you won’t amend the trust, but advise you MAY consider a deed of variation once your dsm dies.

I’d leave it. When DSM dies presumably you could do a deed of variation then, if you still at that point feel like giving some of your inheritance from your dad to a pair of (more or less) strangers?

I too say leave it. If your dad felt strongly on this because he loved your step-sisters as much as he loved you, he could have easily changed his will himself. Presuming your step mum and dad loved each other dearly, either your dad felt so strongly about this that he wanted to over-rule your step mum's wishes to have it split 3 ways, or she agreed with it.

The terminology is important here. Is the 50% your dad left for you a declaration in his will, in which case, you already own half the house, or was it put in a trust? Unusual to do the latter for estates of less than a million due to the fees.

As I understand things, it is also very difficult to change a trust.