It has always been an urban myth that death cancels a 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.

How do I know whether a debt needs to be paid after death?

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. This sounds extreme, but that is the law.

If you have obtained judgment but you haven’t obtained a writ of control before the debtor’s death, the 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 left 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.

The debt is paid off in a series of steps:

  1. The creditors need to be made aware the person had passed away
  2. You must check if the person who has died took out any insurance to pay off the debt. If there is insurance, what you can claim will be laid out in the policy. If there is no insurance, the creditors will need to be informed so that they can arrange to pay off the debts.
  3. Payments will be made in priority order: secured debts, priority debts and unsecured debts

Are there cases where the court must be involved in debt collection after a death?

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

Need debt recovery advice?

If you need any advice about how to recover money that you are owed, email Richard at richard.anderson@beswicks.com or phone 01782 205000. Alternatively, you can find out more about our debt recovery services.