Solicitor says service charge arrears were missed after inherited flat sale

[LBFseBrom]

Good evening.

I recently sold a flat which I inherited, it was more trouble than it was worth and caused me a lot of anxiety. I'm elderly and felt quite ill some of the time, worrying about it.

Anyway at last it was sold, price reduced twice, and I had to pay off the mortgage, council tax arrears and goodness knows what,else, was left with a few hundred!

Nevertheless it was good to have it completed and over.

I have now heard from the solicitor who was handling it for me and she said:

"It has come to my attention that following completion of the sale, the service charge arrears
in the sum of £5,216.01 were omitted from the completion statement. These funds were
sent to you in error as part of the proceeds of sale instead of being paid to the managing
agent to repay the service charge arrears. "

I do have any money at all, I live month to month on pension. I hate pleading poverty, I do manage but what am I going to do? I currently need plumbing and electrical work done in my flat and dental treatment, can't afford any of that, I'm flushing the loo with a bucket of water.

Borrowing on my flat is not an option as it is in an over 60s block (big mistake but that's another story). In any case I couldn't afford monthly repayments, I only just manage to pay the maintenance charges and other bills here every month.

Where do I stand legally?

Thank you very much.

I'm no expert, but was always under the impression you can't inherit debt. Though you might need to pay what was owned from whatever you inherited.

I would contact citizens advice bureau or ask for a 15 minutes free advice from a solicitor? Unfortunately these mistakes do happen.

I think in the first instance, you need to go back to the solicitor as it is their error!!

secondly any debt can only be taken out the estate so say the debt is £5216.01
you were left with eg £216.01 just for arguments sake
they cannot make you pay the £5000 debt as there wasn’t enough money in the estate - this would be my understanding.

sorry to read this it sounds stressful I hope
you can get it sorted out xx

The debt is owed by the estate, not you. You will have to repay the small amount you inherited but the debt isn't yours.

I have told the solicitor I have no money.
The flat became mine when the person died.

What happened to the proceeds from the flat and how much were they.

Its an unfortunate error but they can recover that from you if the proceeds exceeded the debt

Did you really on,y inherit a few hundred from the sale of the flat? If so, that’s all you have to pay to clear the debt. The rest dies with the estate,

When you say a few hundred do you mean a few hundred pounds or thousands.

if there was no money then you can’t be held accountable for more than you inherited

Are the arrears for the period before or after their passing?

Have I understood correctly, di you receive the flat as an inheritance then sell it?
I wonder if that’s different from the estate selling the flat and you receiving the money?

I’m so sorry, this must be very stressful.

If it’s a few hundred and the debt exceeds the value of the assets it’s an insolvent estate so the solicitors needs to tell the people who run the service charge for the flat

Yes, this.
I was executor for a family member, if there's not enough funds in the estate to pay the debts the debt dies with the debtor.

Do you have a breakdown of finances involved?
*Sale price
*Mortgate
*Council tax arrears
*Other debts paid
*Amount inherited after debts settled

Send it all to the solicitor.

You may have to return the few hundred but you're not liable for the rest of the debt.

You could offer a payment plan for the few hundred, at this point I'd send a breakdown of your own incoming and outgoings to show you'd struggle to pay.

Do you have any family or a good friend to help you pull everything together?

Good luck, try not to worry.

You can't just tell them though, you need to prove to the management company that there is no money in the estate to pay the arrears the are asking for.

If you handled it all yourself, you must have a record of how much you received and what you had to pay out for? Sent that to the solicitor and/or management company, be prepared to produce proof (bank statements, copy bills etc), with a covering letter explaining that there was only a small amount of money left.

The estate is liable for that money, not you personally.

They may want the couple of hundred pounds you inherited though.

What will matter is whether the flat was put in to your name and then you sold it, or it was sold from the estate. As you said there was a mortgage I assume it was still in the deceased’s name when it was sold, in which case if there isn’t enough money to pay the debts you need to tell the solicitor to tell the service charge company the estate has no money left after paying the debts and they will have to write it off. However if you owned the flat in your name and sold it then you will be liable. Go back to the solicitor and talk it through with them and they can tell you what can happen, but at the end of the day if you have no money then you have no money, what are they going to do?

OP get proper advice but I believe the very worst they can do is take you to court and youd be ordered to pay back an affordable amount each month. And very likely it won't come to that . Ask CAB.

@LBFseBrom you inherited the flat?

You did not own it in any way before you inherited it? If your name was on it all along, then it's different.

But if you inherited the flat, these outstanding costs belong to the estate. No one can come after you for them.

if the estate has no money to pay them, then that's tough. They still can't come after you for it.

Did you pay the service charge after you inherited the flat, and these arrears are from prior to then?

But the money to pay was there ,it was sent to the OP instead of the Managing agents
So not an insolvent estate
The solicitor has made a mistake and you are liable to pay the money back
You might be able to convince the solicitor to pay some of it to compensate for their error and /or for you to pay it up

Oh that's true

But also, if it wasn't her debt, she shouldn't have to pay it

The estate might have to pay it, but that's a different thing

I've just realised @LBFseBrom also mentioned council tax. You shouldn't have to pay someone else's council tax arrears. Again the estate might have to pay but not OP personally.

You seem to be saying that the disputed service of approx 5k was not in fact sent to you. Have I understood that correctly? (You said that you received a few hundred pounds, not thousands). If you didn't actually receive it, surely there's no question of "repaying" it.
I would reply to the solicitors just telling them that you can't repay what you never received.
I think this is probably a failure on the part of the buyers and their solicitors to check whether any service charges were outstanding. If they wanted these to be dealt with by the seller ( you either in person or as the exectuor) they should have either have insisted on seeing a receipt, or putting it in as a term of the contract, and then your solicitors should have checked that the sale proceeds would be sufficient. I reckon that maybe the management company ( who should have sorted this in advance) are asking the new buyers to pay the outstanding charges. Do you even know if the charges were billed before the sale completed?
I would say on the info you have provided that it is unlikely that you could be forced to pay these charges, but I'm not sure how exact the info you have provided is.

Looks to me like the solicitor fucked up. The arrears were omitted from the completion statement. That is a pretty fundamental error, and was not your fault. I don't think they should be able to force you to pay up.

The debts of the deceased were not your debts.

You have acted in good faith throughout.

Was the inheritance a retirement flat? I’m not a lawyer I’m afraid, so I can’t offer any useful advice, but what a stressful situation. And sadly, one i keep reading about. It’s a complete rip off.

@LBFseBrom How long ago did you inherit the property? Who was the executor, and who distributed the proceeds of the estate? They should never have allowed ownership of a property to be transferred into your name if there was still an outstanding mortgage on it. That mortgage should have been paid off by using the funds of the estate of the deceased, and if the estate included the flat, then it should have been sold at the time and the mortgage and any other fees like solicitors' costs, council tax (and service charge arrears) etc should have come out of the proceeds of the sale of it. If that left a negative balance, then that debt would have had to be written off by the lenders and other organisations.

Were you the sole beneficiary of the will, or were there bequests to other people?

Op did you explain why you habe no money?

so you got the proceeds from the sale. You then need to detail what you paid for the estate from those proceeds and state rhe balance.

hoeveer this should have been settled as part of the estate.