Can I recover debt from a deceased person’s estate?

Pursuing unpaid debts is never easy, but when the debtor has passed away, it becomes that much more challenging.

Care providers can find themselves waiting on family members to act while facing the risk of assets being dissipated and invoices becoming legally written-off. However, creditors do have some options - and taking swift, informed action can make all the difference.

At Wilkin Chapman, we recently supported a client that was owed over £20,000 in unpaid adult social care fees. The debtor had passed away, and probate had been granted to their daughter - who was also, critically, the executor of the estate. The deceased’s Will stipulated that their leasehold property be gifted to the daughter, who subsequently transferred the title to herself.

However, after reviewing land registry documents, it became apparent that while she had indeed acted in line with the Will itself, she had failed in her legal duty as executor. This is because, under the Administration of Estates Act 1925, executors must ensure that all debts are settled in full before distributing assets. By transferring the property to herself without addressing these outstanding liabilities, she had breached this duty and thus made herself personally liable for the debt.

Balancing the need to reclaim the unpaid debt with the need for sensitivity, we advised our client to pursue the executor personally to reclaim the amount owed. A formal demand letter was sent, outlining the outstanding debt and the risk of legal action. This prompted immediate engagement, resulting in a payment plan that cleared the balance within five months.

Addressing debt when no probate has been granted

Another common challenge arises when no grant of probate or letters of administration have been issued. In one such case, a client was owed £76,000 in unpaid adult social care fees. The deceased owned a vacant freehold property, which was deteriorating.

Despite concerns about the lack of probate, we advised issuing an insolvency administration petition against the estate. This process, similar in scope to bankrupting an individual, allows a court-appointed trustee to administer the estate and recover assets for creditors. Our legal team successfully argued that service of the petition should be dispensed with due to the absence of a formal grant of probate.

The court granted the insolvency administration order, and a trustee was appointed to manage the estate, leaving our client set to recover their outstanding fees and legal costs.

Swift action when pursuing debts is critical. Executors have legal obligations, and although it can be a difficult time, creditors should not hesitate to enforce their rights. Whether it’s seeking recovery from an executor personally or securing an insolvency administration order, there are effective avenues to ensure debts are repaid.