Understanding Private Client Terms: A Glossary for Wills, Probate and Lasting Powers of Attorney

Understanding the terminology surrounding wills, probate, and lasting powers of attorney can feel overwhelming. However, a clear grasp of these terms can simplify the process for testators, donors, executors, and beneficiaries. This glossary provides a solid foundation for navigating the private client landscape effectively.

Wills

A will is a legal document that outlines how a person’s assets and affairs should be handled after their death. It ensures that your wishes are followed as intended and that your loved ones receive what you’ve designated for them.

The testator is the person who creates the will. They decide how their estate will be distributed, appoint guardians for any minor children, and choose executors to manage the estate. Selecting a reliable friend or family member as an executor can help ease the administrative burden during a difficult time.

The executor has a crucial role in administering the will. They are responsible for ensuring the deceased’s wishes are fulfilled, managing the estate’s assets, paying any debts and taxes, and distributing what remains to the beneficiaries.

Beneficiaries are the individuals or organisations named in a will to receive specific assets or portions of the estate. Understanding who the beneficiaries are and what they are entitled to is important for everyone involved, as it helps ensure clarity and fairness. Clearly outlining each beneficiary’s share, such as specifying exact percentages, can also reduce the risk of confusion or disputes later on.

Probate

Probate is the legal process that takes place after someone dies, confirming the validity of their will (if one exists) and authorising the executor to manage and distribute the estate. It ensures that all debts, taxes, and final wishes are properly handled before assets are transferred to beneficiaries.

The executor is the person named in the will responsible for overseeing this process. They collect the deceased’s assets, settle outstanding debts, pay any inheritance tax, and distribute the estate according to the will’s instructions. For example, an executor may sell property or investments to raise funds for taxes or to divide the estate fairly among beneficiaries.

If there is no will, the deceased is said to have died intestate, and the court appoints an administrator to manage the estate instead. The administrator’s duties are similar to those of an executor, though the distribution follows the rules of intestacy rather than personal wishes.

A Grant of Probate (or Letters of Administration in intestate cases) is an official document issued by the Probate Registry, giving legal authority to the executor or administrator to act on behalf of the estate. Without this grant, financial institutions and organisations may not release funds or transfer ownership of property.

Finally, beneficiaries are those entitled to inherit under the will or the intestacy rules. Clear communication between executors, administrators, and beneficiaries is essential to prevent confusion or disputes during the probate process.

Lasting Powers of Attorney

A Lasting Power of Attorney (LPA) is a legal document that allows an individual (known as the donor) to appoint one or more trusted people (called attorneys) to make decisions on their behalf if they lose mental capacity or are unable to make decisions themselves. Having an LPA in place ensures that your personal, financial, and medical affairs are managed according to your wishes, even if you are unable to express them. In the UK, around 1 in 5 adults have an LPA in place, reflecting its growing importance.

There are two types of LPA: one for Property and Financial Affairs and one for Health and Welfare. The Property and Financial Affairs LPA allows attorneys to manage money, pay bills, or sell property, while the Health and Welfare LPA covers decisions about medical treatment, care, and living arrangements.

The donor is the person creating the LPA, deciding who to appoint as attorneys and what powers they will have. Choosing someone reliable and trustworthy is essential, as they will be responsible for acting in your best interests.

The attorney is the individual (or individuals) appointed to make decisions for the donor. They must act honestly, responsibly, and always in line with the donor’s preferences and legal obligations.

An LPA must be registered with the Office of the Public Guardian (OPG) before it can be used. Without registration, the document is not legally valid, and attorneys will not have the authority to act on the donor’s behalf.

Final Thoughts

Understanding the key terms associated with wills, probate, and lasting powers of attorney is essential for anyone involved in estate planning or administration. Being familiar with these concepts helps you navigate the complexities of private client matters with greater clarity.

Whether you are preparing your will, appointing an attorney, acting as an executor, or named as a beneficiary, a solid understanding of these terms enables you to make well-informed and confident decisions.

In the field of private client services, knowledge is invaluable. With this glossary as your guide, you can approach estate planning and administration with assurance, ensuring your intentions are honoured and your loved ones are well protected.