Have you, or another member of your family, been approached by probate genealogists to sign a Limited Power of Attorney? If so, it’s important to be aware of the options open to you, and those you may wish to avoid.
In recent years, we have been aware of a growing and worrying trend in our industry - potential beneficiaries are routinely being asked to sign a Limited Power of Attorney, usually appointing a partner or employee of the probate genealogy company concerned as both Attorney and Administrator.
A Limited Power of Attorney should be the exception, not the rule - there is no justification for a genealogist to be given Limited Power of Attorney. The Administrator of an estate should always be a blood relation of the deceased, other than in the exceptional circumstances mentioned below. Even in that case, the Attorney Administrator should be a properly regulated legal professional.
A Limited Power of Attorney means the heir is being asked to relinquish any control or input into the estate administration process - in doing so, they would also deny any other entitled family members the opportunity to act as Administrator. This could potentially result in the genealogy company being handed a blank cheque - in addition to their agreed percentage commission fee, they would be in a position to charge significant additional administration costs as they see fit. The genealogists would also be free to make decisions in their own best interests, at the expense of the estate; for example, they could sell the deceased’s property to themselves or an affiliated company for a sum considerably less than its market value. This may sound a little far-fetched, but there have been reports of such incidents in recent years, some of which have reached the pages of respected publications including Private Eye. The estate accounts - which set out all the financial transactions - can be signed off by the attorney.
Hoopers adheres to the standard, and generally considered best practice established in our profession for many decades; to ensure an estate is administered properly and in the interests of all its beneficiaries, we recommend the services of one of a number of independent and impartial law firms - solicitors we know from experience to be thorough, efficient, cost-effective and highly-experienced in this field. The law firm would write to the heir who has agreed to act as Administrator with their terms of business - the Administrator has the choice of accepting our recommendation, or making alternative arrangements of their own. Any administration expenses would be deducted from the estate - the Administrator and other heirs are never directly liable for such costs.
The Administrating Solicitor’s job is to make life as easy as possible for the Administrator, and undertake the bulk of the necessary “leg-work”. However, the solicitor would be acting in the Administrator’s name and on their behalf - should the Administrator prefer to be more “hands-on” and directly involved with the process, their wishes would be accommodated. The Administrator would be kept informed of any significant developments, and be required to “sign-off” any major decisions (for example, the agreed price on the sale of a property).
Hoopers’ expertise and experience lies in tracing entitled kin, proving their entitlement and taking the steps necessary to recover their shares of the estate on their behalf - estate administration is a separate, specialised field. We recognise the inherent conflict of interest in a genealogist (with a financial stake in the outcome) acting personally as the Attorney Administrator. Any qualified administrating solicitors we recommend are answerable to external and independent regulators, primarily the SRA (Solicitors Regulation Authority) - any genealogist will at best be self-regulated or part of a non-statutory trade association.
A Limited Power of Attorney can occasionally be useful, but Hoopers only advocate signing them in rare and exceptional circumstances. Examples of this would be if the only family member available and willing to act as Administrator lived in an overseas location where maintaining regular communication and correspondence between them and the Administrating Solicitor might prove problematic, or if they were very elderly or otherwise unable to handle the responsibility involved. However, in these situations the appointed attorney would always be a qualified and regulated legal professional, never a partner or employee of Hoopers.
If you’ve been asked to sign a Limited Power of Attorney and these exceptional circumstances do not apply to you, we urge you to take your time, think carefully and ask questions first - you may be signing away far more than you bargained for.