No next of kin? How bona vacantia estates can yield instructions, as well as heirs

27 January 2011

Louise Levene, Consultant, Title Research

Every year over 2,000 apparently ownerless estates are referred to the Bona Vacantia authorities. At a time when competition in the probate arena is at an all time high, practitioners can draw commercial opportunities from these estates, which very often can yield clients as well as heirs.

Bona Vacantia – the basics

So what exactly does Bona Vacantia mean? It’s simply a term used to describe ownerless goods. In the context of probate, it refers to estates where the Deceased died without a Will, and without, apparently, any surviving kin. Such estates devolve to the relevant Bona Vacantia authority. In England & Wales this means the Crown, or the Duchies of Cornwall or Lancaster, depending on where the Deceased lived. The Treasury Solicitor handles estates referred to the Crown; while Farrer & Co Solicitors handle such estates on behalf of the Duchies. In Scotland, Bona Vacantia estates are referred to the Queen’s and Lord Treasurer’s Remembrancer Office.

However, we can reasonably say that such estates are quite rare, since the breadth of our intestacy provisions mean that the overwhelming majority of estates that may initially appear to be Bona Vacantia do, in fact, yield entitled heirs. However, when presented with an apparently Bona Vacantia estate many practitioners will refer the matter to the relevant Bona Vacantia authorities losing out on professional fees as a result.

This is not too surprising – after all, you need to have a client to extract the grant and instruct you in the administration, and if there is no-one to hand entitled to a share of the he estate, won’t the estate go to the Crown or Duchies anyway? Not necessarily.

In the Law Society’s “Probate Practitioners Handbook” (5th edition), Professor Lesley King, Private Client Practice Head at the College of Law, presents another option for practitioners to consider:

‘In this situation, a solicitor might consider asking a firm of genealogists if it is willing to establish the position, without committing the solicitor to fees. Some firms will do this by deferring their fee (which should be agreed with them in advance) for locating a person entitled to the grant until after the solicitor has been instructed and the grant extracted, and agreeing that if the estate proves to be Bona Vacantia, or if the solicitor does not ultimately take instructions for whatever reason, the genealogist will waive their fee’

Case study – Mr Smith
Let us consider the above statement for the estate of Mr John Smith (his name has been changed), where the probate practitioner involved passed the estate to the Bona Vacantia Division. Mr Smith died on 18 October 2009, aged 82 years old. He died intestate and with no known next of kin. The probate practitioner to whom the estate had been referred felt that, in the absence of kin from whom to take instructions, they had no alternative but to refer the case to the Treasury Solicitor.

The Bona Vacantia division will usually make some enquiries to establish any next of kin. If such enquiries are negative, they then publish details of the estate. In Mr Smith’s case, the Treasury Solicitor advertised the estate in the national broadsheets and on its website. These notices occur most weeks, and it is interesting to speculate on the professional fees foregone by practitioners as a result of referring estates to the Bona Vacantia authorities.

Within a matter of days an heir hunter, acting on behalf of next of kin they have found, submitted a claim to the Treasury Solicitor. In line with the stated policy of the Treasury Solicitor, when such a claim is submitted, the Treasury Solicitor gives up all interest in handling the estate. The estate was subsequently referred to a third party firm of solicitors, and the practitioner who originally handled the estate had, by referring the matter away, lost the opportunity to be instructed in its administration.

As mentioned, the breadth of intestacy provision in England & Wales and Scotland means that true heirs in the overwhelming majority of apparently Bona Vacantia estates do exist and can be found without undue difficulty, if the correct steps are taken. In this case, Mr Smith was born in 1927: even if he had left no surviving spouse, issue, parent or sibling of the whole or half blood (or their issue) or grandparent, the chances of there not being surviving issue of paternal or maternal uncles or aunts of the whole blood (failing which, of the half blood) would be remote. It’s also worth considering that he lived in an era when his parents would be likely to have had a greater number of siblings than would be expected today.

Administrator search
To revert to the guidance offered by the Law Society’s “Probate Practitioner’s Handbook”; Title Research offers a service we call “Administrator Search”. We undertake the research, at our own risk, to find for the practitioner at least one person entitled to benefit from the estate to allow the practitioner to proceed with the administration of the estate. In Mr Smith’s case, had the probate practitioner instructed us to conduct this search, the practitioner could have wound up his late client’s estate without needing to refer the matter to the Treasury Solicitor.

We have a 92% success rate in conducting Administrator Searches where we find an heir eligible to extract the Grant, who has subsequently gone on to instruct the practitioner in the administration of the estate. Of course, there is no guarantee that even if an entitled person is located, that they will actually instruct the practitioner handling the estate. In the 8% of cases where we have been unsuccessful in locating an heir, or where the heir has instructed another solicitor, our time based or fixed fees have been waived. Rest assured that we never charge percentage fees. Our position is that percentage fees are usually disproportionate to the amount of research involved and can excessively deplete the value of the estate.

Other options
There are some specific circumstances in which the practitioner might consider seeking a limited or discretionary Grant, such as, for example, a S116 Court Order under the Supreme Court Act 1981; or, if there are vulnerable assets, perhaps a Grant ad colligenda bona. However, we must firmly stress that any such Grants are issued solely at the discretion of the District Probate Registrar or Judge.

Clearly, finding a course of action from the options above that enables the practitioner to take instruction in the administration of the estate, and wind up his or her late client’s affairs, represents a significant commercial benefit to the practitioner, and avoids a referral to the Bona Vacantia authority. After all, 92% of our cases have yielded an heir…

For further information please contact Louise Levene on 0207 332 9090 or email at louise.levene@titleresearch.com