Situation of assets is now key probate query

Cross-border and multi-jurisdictional estates are both increasingly common and increasingly complex to administer, a Law Society solicitor update has heard

Speaking at the Law Society’s Probate and Tax update (12 March), tax expert Jane O’Quigley explained that cross-border or multi-jurisdictional estates applied not only to the domicile or residency of the deceased, but could also include when assets are outside of Ireland, the beneficiaries were outside of Ireland, or that the executors were now non-resident.

The O’Connell Brennan LLP senior associate explained that one of the first questions a practitioner needed to answer when completing an SA.2 form was where the assets situate.

She said that this was usually a straightforward matter regarding real property or land, “reasonably straightforward” regarding bank accounts, but could be more complex in matters of investments.

For investments, Jane O’Quigley highlighted the importance of the International Securities Identification Number (ISIN) and the value of speaking with the original investment advisor.

For the SA.2 form, the lawyer said that the three main factors to take into account were:

• What is the threshold?
• What is the rate, and
• What is the deadline.

These factors would differ in each jurisdiction, she explained.

Jane O’Quigley also spoke about clearance to distribute, highlighting that Irish-resident personal representatives might be liable for the CAT of a non-resident beneficiary if that beneficiary failed to file a return or pay the tax.

Under Section 45AA of the CAT Act, there is no de minimis threshold, so liability applies regardless of the value of the inheritance or type of asset.

This liability can also extend to Irish-resident solicitors acting on behalf of non-resident personal representatives.

Protections existed if the personal representative or solicitor acted in good faith and had taken all reasonable steps, but reliance on the statutory protections alone could be risky, she added. 

To manage this, Revenue and the Law Society have established a voluntary clearance procedure (commonly referred to as a “30-day clearance”), set out in the CAT Tax and Duty Manual.

Jim Dalton of the Courts Service gave an update on the e-probate system.

To date, this includes an internal probate case-management system rolled out to the Dublin Probate Office and 14 District Probate Registry Offices, and the updated online probate register with modernised search and data system.

With a small group of solicitors, the Courts Service is currently piloting the online probate application capability through the Courts Portal.

The portal, which already supports certain Circuit Family Law filings, such as divorce and judicial-separation applications, is intended to become the central filing platform for multiple jurisdictions and case types across the courts system, including High Court proceedings.

For probate applications, the portal integrates with Revenue by drawing information from the SA.2 Notice of Acknowledgement, allowing relevant data relating to the deceased, executors, and estate to populate the application. 

The system incorporates automated validation and standardised title generation with the aim of reducing the historically high query rate associated with probate filings.

In accordance with the digital court rules introduced in June 2024, statements of truth replace affidavits and statutory declarations for probate applications submitted through the portal. 

Executors may sign documents digitally through a process involving email notification and mobile verification.

The system is currently limited to relatively straightforward probate applications.

Intestacy applications and additional grant types are expected to be introduced incrementally as the system develops. 

The pilot is targeting a two-week turnaround time for issuing grants, measured from receipt of the original will, although this timeframe has not yet been consistently achieved. 

Issues under consideration include how best to accommodate executors who do not have email access, the handling of special characters in names, and the management of discrepancies between Revenue data fields and probate requirements.

In his presentation on recent case law, Laurence Masterson BL outlined the growing number of judgments in probate but also the need for mediation.

Takeaways from the presentation include the necessity for meticulous documentation, especially in cases involving testamentary capacity or contested wills.

Citing Re: The estate of Margaret Bradley and Murphy -v- Butler & Ors, the barrister said that courts were scrutinising notes closely.

Backbone of affidavits

He added that they often formed the backbone of affidavits and evidence, and sparse or shorthand records could leave solicitors and clients vulnerable to challenge.

Other observations from recent case law include:

• In section 117 matters, as per CB v PP, in camera proceedings are discretionary,
• The two-year limitation under section 9 of the Civil Liability Act 1961 is absolute – even for constructive trusts,
• If a will is missing, an early application to admit a copy via the non-contentious probate list is advisable to avoid the escalation of disputes,
• As in Gilvarry v Naylor, if an estate is insolvent, the legal costs of an executive or administrator must be prioritised over those of a beneficiary.