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Thursday, September 17, 2020

Buying a Will Bank - Do I Need to Get Permission from the Testators?


If you buy a will bank, do you need to write to all the testators to advise them of the change in location and ownership?

This has arisen recently following the purchase of a will bank (not one of our clients but a general query). Both the seller and the buyer had been concerned that the buyer should write to the many thousands of testators in the will bank to advise them that the potential ownership and location of their wills has changed and to get their consent to the transfer of location. This has obviously raised issues as to whether or not it is possible or practical to purchase a will bank if you have to do this when a sale occurs.

Any Ideas?

We would welcome any thoughts on this issue as we have, in the past, heard conflicting advice from the regulators. The following information is not intended as advice, but rather simply anecdotal experiences we have had, and should not be relied upon to take a particular course of action.

Anecdotal Information

We were involved some time ago in the sale of a law firm somewhere in the UK, where the seller discovered a will bank in the cellar and was very concerned as to what they ought to do with it when it came to the transfer of the business. In fact they were so concerned they contacted the SRA and received advice that permission was needed for the wills to be transferred to a buyer. They relayed this information to the buyer, who promptly put the whole thing on hold and eventually pulled out. The same firm managed to sell a year later to a buyer who wasn’t the slightest bit interested in contacting all the testators in the wills and simply took over the practice.

Similarly, many years ago family members had wills drawn up by a law firm in West Yorkshire who subsequently closed down due to fraud by one of the partners. The family members in question were not aware of this until I alerted them to the fact that the firm had closed down some years later. We discovered the practice had been taken over by another firm and their wills had been moved to their premises. At no time had the practice taking over the will bank contacted the family members in the intervening period. Presumably, the practice taking over had decided that it was either not practical or required for them to contact all the testators in the wills.

Prohibitive Costs

Presumably the cost of contacting every testator to get permission to transfer their will (or at least notify them) would be so prohibitive it would make any sale of any law firm or will bank impossible. If there was a will bank of 10,000 you would have to send out 10,000 letters, and then follow these up, because chances are in 80 to 90% of cases you would not get a response, so a 10,000 will bank would suddenly turn into a 1,000 will bank and completely remove any value at all.

If anyone has experience of this issue or can point us in the direction of regulations or practice guidelines that confirm the position one way or the other, we would be most grateful. We can either post a link to your site or relay the information anonymously.

Jonathan Fagan is Managing Director of Ten-Percent Legal Recruitment and a non-practising Solicitor. Ten-Percent Legal Recruitment provides online Legal Recruitment for Solicitors, Legal Executives, Fee Earners, Support Staff, Managers and Paralegals. Visit our Website to search our Vacancy Database. Our Legal Careers Shop has eBooks on CV Writing for Lawyers, Legal Job Interview Guide, Interview Answers for Lawyers, NQ Career Guide, Guide to Finding Work Experience or a Training Contract and the Entrants Guide to the Legal Profession.

1 comment:

Anonymous said...

A response from one of our locum solicitors:
With regard to Wills banks and I am sure that it must be the same in Scotland as in England and Wales:
testators are asked if they wish the Solicitor to store their Wills – that is for safe keeping but also because the Solicitor wishes to secure the business of winding up the estate on the death of the testator;
in my opinion when a business is sold there is absolutely no need to obtain any testators’ permission to the transfer; in effect this would interfere with normal business practices and severely restrict the attraction of a firm with a Wills bank;
the Wills are still being stored safely but in a different location and by the successor firm;
any effective firm of Solicitors in terms of good practice should be getting in touch with all those testators from time to time anyway to suggest they review their Wills and this would give an opportunity to tell them where the Will is, why it has changed hands and so on. Such a review can be done on an incremental basis, over a period of months, according to date or to the alphabet. I have been involved in such an exercise which took place quite a few years after the Wills bank was taken over. This exercise should bring in a lot of Will review work and cross selling opportunities - hence the value of the Wills bank;
none of the testators are obliged to use the new firm – they can simply uplift their Will;
nor are the Exectors obliged to use the new firm to wind up a deceased’s estate.
I have experience of working for a firm which was being sold to another local firm and there was a large Wills bank.
No such effort was made to contact all the testators.
So far as I know the new firm did not immediately contact all the testators either.
What did happen though was that in the run up to the demise of the selling firm they advertised locally and on their website and made other efforts to let the local populace know.
There was therefore a great awareness of the sale of the firm and those who accessed the website or visited the old offices were able to read clear messages about where they could find out about the take over and their files.