It has always been an urban myth that death cancels debt. However, the truth is that debt survives beyond death.
When a person dies, their debts must be repaid from their estate before any other claim on the estate can be met. No-one else becomes responsible for the debt, but the debts are recoverable from the assets and money left behind.
If you have obtained a judgment through the courts and a writ of control was issued before the judgment debtor’s death, then enforcement can proceed by taking control of the goods held by the personal representative on behalf of their estate. Sounds harsh, but that is the law.
If you have obtained judgment but you haven’t obtained a writ of control before the debtor’s death, court’s permission is required before the writ can be issued. Enforcement can then proceed as normal.
If enforcement takes place and goods belonging to the estate are seized, any surplus after sale will be returned to the estate.
However, if there are insufficient goods in the estate to cover all the debts, the estate will be insolvent and the creditor can present a petition to court for an insolvency administration order. The executor will prioritise secured debts, followed by reasonable funeral costs, then unsecured debts.
A writ of execution or writ of control to enforce a judgment or order may not be issued without the permission of the court in the following cases:
- where six years or more have elapsed since the date of the judgment or order;
- where any change has taken place, whether by death or otherwise, in the parties entitled or liable to execution under the judgment or order;
- where the judgment or order is against the assets of a deceased person coming to the hands of his executors or administrators after the date of the judgment or order, and it is sought to issue execution against such assets.
If you need any advice about how to recover money that you are owed, email Richard at email@example.com or phone 01782 205000.