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Family Finance.

Byline: TONY HETHERINGTON

Q: My uncle died and left me over pounds 50,000 in his will. I have now received a letter from the solicitors handling his estate, saying they made a mistake and overpaid me. They are asking for the immediate repayment of pounds 11,395. I could not now easily find such an amount. Am I legally obliged to repay this, since it was the solicitors who made the mistake? J S A: The simple answer is yes, you must repay the money. The reasons go back to a legal case called Ministry of Health v Simpson in 1951. Executors wrongly paid out money to charities instead of to the rightful beneficiary, the deceased's next of kin. The court held that the next of kin could reclaim the money from both the executors and the charities.

However, you could be in a stronger position than this suggests. For example, a different court decision means you could plead a 'change of position', arguing that you have spent the money and cannot afford to repay it.

There is also the possibility that you could claim against the executors for negligence, though this would depend heavily on the facts, on why the overpayment happened, and whether you could have spotted it.

At the very least, do see a solicitor of your own. If you resist the other side's rather silly demand for an 'immediate' payment of more than pounds 11,000, I would not be surprised to see them settle for less.

Q: We have a mortgage of just over pounds 100,000 and very little by way of savings. Completely unexpectedly, I have inherited almost pounds 30,000 from an aunt who died without leaving a will or any close family. The temptation is to pay pounds 30,000 off our mortgage and reduce our monthly payments, but that would leave us with no savings again. What do you advise? Mrs M W A: If there are no penalties attached to your existing mortgage, consider switching to an offset mortgage. Your pounds 30,000 would earn no interest, but you would only be charged interest on roughly pounds 70,000 of your mortgage, so you will gain more than you lose.

Your existing lender may offer an offset loan, or consider First Direct (0800 482448), which has recently been offering this scheme at 2.08 percent interest.

Q: I switched credit cards last March, but now my old card company has billed me for mobile phone insurance that I no longer need. As the card no longer exists, how can I be sent a bill? K L J A: The paperwork you sent me refers to a 'Continuous Authority Payment' that you signed, allowing the insurer to collect premiums from your card. Unfortunately, you never told the insurer to cancel this, which is why the card company is obliged to pay, and why you are obliged to pay the card bill.
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Publication:Huddersfield Daily Examiner (Huddersfield, England)
Date:Nov 16, 2011
Words:492
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