Executors letting property

Can anyone advise me on this please?
If an executor lets a property which forms part of the estate, then is the rental liability to him or to the beneficiaries?  If anyone can kindly point me to legal references then it would help enormously.

To the estate, until it is administered. Thereafter, the beneficiaries.

Beneficiaries of an estate do not acquire an equitable interest in any part of the estate until the executors can be quite sure that the asset is going to be available for them (ie, not needed to pay debts, adminstrative expenses, inheritance tax etc).

Once they no longer need the property it can either be passed over to the beneficiaries or, if there is going to be an ongoing trust, the executors need to transfer it formally to trustees (who could be themselves, but a formal transfer and registration with the land registry is still needed).

If there is a trust you would need to know what sort - ie, if the beneficiaries are adult and have a right to the income, then for tax purposes at least the income is theirs outright.  It would be different if they were children or the terms of the trust gave the trustees discretion about the way the income is handled (you do not want to know about the taxation of trusts like this…)

From a benefit point of view income from a trust is taken into account as income as it arises or is paid over. If the property has actually been put into the names of the beneficiaries they then have capital, of course, and the receipt of rent is also capital.

There could be problems if the executors are not being advised by a solicitor as they often haven’t any idea what they ought to be doing.

Thanks for the replies.  The situation I’m dealing with is this: an executor has let a property, which forms part of the estate, to a tenant; the tenant argues that the rental liability is not to the individual with whom she has entered into the agreement (i.e. the executor) but to the beneficiaries (adults) of the estate; in the alternative, she argues that the executor had no legal title enabling him to let the property.  I take the view that the liability is to the executor - while he is executor, the property is vested in him (s 1,  Administration of Estates Act 1925; Social Security Commissioner’s decision CH/1278/2002, citing Halsbury’s Laws).  As to the alternative argument - even if that were the case, I suggest that it’s immaterial ( Bruton v London Quadrant Housing Trust; Kay v London Borough of Lambeth).  But I’d welcome opinions as to whether that seems about right.

“The tenant argues that the rental liability is not to the individual with whom she has entered into the agreement (i.e. the executor) but to the beneficiaries (adults) of the estate; in the alternative, she argues that the executor had no legal title enabling him to let the property”.

Why is she arguing this?

Only the owner of the legal title of property can create a lease. When a grant of probate or administration is made, then if the executors decide for the time being to hang onto the property they really ought to get themselves registered as PRs at the Land Registry, or assent the property to trustees or the beneficiaries. Why haven’t they done either course?

If the adminstration of the estate is complete and the beneficiaries are all adult and sound mind, and between them absolutely entitled to the property (ie, no possibility that anyone else might become entitled in any conceivable circumstances), then under the Rule in Saunders and Vautier they could compel the executors to transfer the title to them.

I go back to my previous question: have solicitors been involved? If not, it’s high time they were. In my experience as a former probate solicitor, it’s the sort of people who think that employing solicitors is a waste of money who make solicitors rich. We have a classic example in the Bureau at present.