The person responsible for administering an estate after someone has died is referred to as the Personal Representative, this may be an Executor or an Administrator. One of the several responsibilities of a Personal Representative is to settle any outstanding debts.
Section 27 of the Trustee Act 1925 enables Personal Representatives to place a notice in the Gazette or the local newspaper giving any potential creditors two months to claim back money or property they are owed before the estate is distributed.
Section 27 Notices do not offer protection in respect of all unpaid debts. If it can be proven that Personal Representatives were aware of an unpaid debt when the estate was distributed, they will be liable for this debt.
Is this a legal requirement?
Whilst this is not a legal requirement, it is highly recommended, as the notices act as protection for the Personal Representatives. If a Section 27 Notice has not been placed, the personal representative can be held personally liable and may have to personally settle the outstanding debt.
How to place a Section 27 Notice
Generally, Section 27 notices are placed by a professional, usually a Solicitor either on behalf of a Personal Representative or as a Professional Executor. However, anyone can place notices.
To place a Section 27 notice, a Grant of Probate, Letters of Administration or the death certificate must have been obtained. The cost of placing the notice is an administration expense, so the cost is covered by the Estate.
Guidance can be found on the Gazette’s website: https://www.thegazette.co.uk/wills-and-probate/content/299
