In winding up an estate, the executor will often secure a type of insurance policy known as a bond of caution which protects the beneficiaries of an estate from the executor’s mistakes. Further details about bonds of caution is available here.
A bond of caution is not required for all estates. If the executor was named in the will, then a bond of caution is not necessary.
If, however, the deceased did not name an executor in his or her will, or died intestate, then the executor will be appointed by court. This will also apply if the named executor resigns and is replaced by another. Where the executor is appointed by court, obtaining a bond of caution is a legal requirement.
There are various exceptions to this requirement, however. These are:
- Where the value of the estate is less than £36,000 (i.e. a ‘small’ estate) and the Sheriff Clerk’s office assists in preparing the inventory form; and
- Where the whole estate is inherited by a surviving spouse or civil partner under the laws of intestacy.
In terms of the first exception, some clients prefer to have their solicitor prepare the inventory form (essentially, an accurate record of the deceased’s assets at the time of death), although this will mean that a bond of caution is required. This is because the estate can often be wound up more quickly, and the client can avoid dealing with the complex processes of the Sheriff Courts. We will always ensure that you have an accurate understanding of the time and cost involved in both options, so that you can make an informed decision.
Regarding the second exception, it is important to note that an intestate estate will not automatically be inherited in its entirety by a surviving partner. Our executry lawyers can explain how the laws of intestacy apply to the estate you are winding up. If the entire estate will be inherited by the deceased’s spouse or civil partner, we will also offer advice on whether a bond of caution might still be a useful measure of protection.
Expert Executry Solicitors Scotland
If you have been named an executor in a will, or have been appointed as such by a court, our experienced solicitors can assist you in all aspects of the winding up process. It is crucial to obtain a bond of caution if this is a legal requirement in respect of the estate. Our lawyers will identify whether a bond of caution is needed and, if so, will ensure that this is obtained quickly and efficiently. Many executors do not realise that they can be personally liable in the event that the estate is not properly distributed. Additionally, the bond of caution does not protect the executor. It is accordingly vital to obtain proper legal advice if you have any concerns at all about the winding up process.
Contact our Executry Lawyers
If you would like to ascertain whether you need to obtain a bond of caution to wind up an estate, or would like to discuss any other executry matters, please contact us by telephone 0141 222 7951 or via our online form at your earliest convenience.