Do I owe Legal & General £400?
I helped my nephew settle the estate of his late mother, who died a year and a half ago. He was executor and main beneficiary.
Part of the deceased’s income was a pension from Legal & General.
A payment was made in respect of this four days after the death. This we presumed was the final one. No further payments were received, so we understood that Legal & General knew they had been stopped.
Then, 14 months after the death, Legal & General wrote to the deceased’s bank claiming back the £400 that had been paid.
The letter was forwarded to the executor, who passed it to me. Legal & General said, in the absence of full settlement, it would instruct its legal department to commence proceedings. RH, WEST SUSSEX
In order to avert, as you put it, unpleasantness, your nephew refunded what in fact had been an overpayment.
You say administration is your particular forte so you had happily stepped in to help. However, it struck me that, as with so many cases where there is a third party involved, you hadn’t liaised entirely between yourselves.
You said your nephew had informed the “one stop shop” of his mother’s death. I suggested this might be the “Tell Us Once” service offered by some local authorities and which, if available, is usually highlighted during the death registration process.
This disseminates news of a death to some local and central government agencies. Other bodies, such as insurers, need to be informed separately but, apparently, in this case hadn’t been.
Unknown to either of you, pension payments had continued to go into a bank account that apparently still had the facility to receive them.
Legal & General only became aware of the death some months later when it received a “mortality report” fromthe Department forWork & Pensions. It then managed to claw back the other payments from the bank, which apparently did not inform the executor.
Legal & General then wrote to the bank as it did not have any details of the next of kin. The letter was forwarded.
By then though probate had been granted and the estate distributed without the £400 being deducted for the purposes of inheritance tax, which had been applicable.
So there had been a loss. Conscientiously you said, if all else failed, you would reclaim the tax retrospectively. Legal & General pointed out that it had every right to reclaim the money and was sticking with this.
I argued that there had been a genuine misunderstanding over the “Tell Us Once” service and, although I did not have the authority to check this out, I felt the deceased’s bank may well have been somewhat lax.
Now, entirely as a gesture of goodwill, Legal & General promised to refund the £400.
This refund was, though, initially inadvertently overlooked but, after further pushing from me, it was authorised 20 days after it had been agreed.
Be aware that independent organisations that offer to notify companies of a death may be tied in with commercial ventures.