Revolutionising Beneficiary Rights: The Landmark Kenig v. Thomson Snell & Passmore Case
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In a pivotal ruling that redefines the landscape of estate administration and beneficiary rights, the Court of Appeal has delivered a groundbreaking judgement in the case of Kenig v. Thomson Snell & Passmore LLP [2024] EWCA Civ 15. This case marks a significant departure from previous legal precedents, offering new avenues for estate beneficiaries to challenge solicitor fees that have been deducted from their bequests.
In this article, Ben Parr-Ferris, Senior Litigator at Healys LLP, explores the implications of the Kenig ruling, highlighting how the Court of Appeal's pivotal decision empowers estate beneficiaries to contest solicitor fees, ensuring their inheritances are protected from unfair charges by executors' solicitors.
The Court of Appeal has made an important decision on the rights of estate beneficiaries to challenge the costs of the solicitor who acted for the executors in the administration of the estate.
In Kenig –v- Thomson Snell & Passmore LLP [2024] EWCA Civ 15 the court considered a case where the executors of an estate instructed TSP to deal with the administration. TSP estimated that their complete fees would be between £10,000 and £15,000 but by the time the administration was complete, they had charged £54,400. The costs had been approved by the executor of the estate, but as they were costs of the administration, they were deducted from the amounts that were payable to the beneficiaries. Mr Kenig was a beneficiary and sought to challenge the fees that had been deducted from his bequest.
Under the Solicitors Act 1974, beneficiaries of estates or trusts can challenge solicitors’ fees in these circumstances by asking the court to assess the costs. Until now, the 2011 decision of Tim Martin Interiors Ltd v Akin Gump LLP meant that such challenges would rarely succeed because if the fees had been approved by the executor then the proper claim was against the executor, not against the solicitor. The solicitor could rely on the approval of the fees by the executor (who was his client) to avoid the fees being reduced.
Kenig has now clarified that the Tim Martin case does not apply to beneficiaries of estates and trusts, and the comments in that case relating to estates were made in error. A beneficiary is entitled to apply to the court independently for the legal costs to be assessed.
Importantly, when such applications are made, the court can take into account the circumstances of the beneficiary, and not just those of the executor, so that the beneficiary may have a better case to reduce the solicitors’ costs than the executor.
If you think that the solicitor who dealt with your estate overcharged and you need advice on the process for having the costs assessed, please contact Ben Parr-Ferris at Ben.Parr-Ferris@healys.com
