Administering insolvent estates
When the liabilities of an estate exceed its assets, it is an insolvent estate. Solicitors acting as executors or advising personal representatives face particular problems when administering an estate which may be insolvent, and can risk personal liability if they fail to comply with the requirements of the Administration of Insolvent Estates of Deceased Person Order 1986 (Insolvent Estates Order).
This practice note offers recommendations and best practice guidelines for solicitors and personal representatives. The issues covered include:
- who can administer an insolvent estate
- the payment of liabilities
- personal liability dangers
- the problems where liabilities are uncertain
This practice note is the Law Society’s view of good practice in this area, and is not legal advice. For more information see the legal status.