Draft Non-Contentious probate (Fees) Order 2018: is the Lord Chancellor acting within his powers?

The Draft Non-Contentious Probate (Fees) Order 2018 increases the fees that must be paid by the executors of a deceased person’s estate when they apply for a grant of probate – the formal document which the executors need to administer the estate. This is issued by the Probate Registry, which is part of the High Court of England Wales (see note 1 below).

The Order has been laid before Parliament by the Lord Chancellor. In a report published today, the Joint Committee on Statutory Instruments (JCSI) questions whether the Lord Chancellor is acting within his powers.

The Order must be approved in draft by both the House of Lords and the House of Commons before it can be made and can come into force.

JCSI’s role is to consider the technical qualities of statutory instruments, not the policy implications.

What changes would the Order make?

The 2018 Order replaces the current fixed fee of £155 (if a solicitor is used to apply for probate) or £215 (if the executors apply personally) to an amount that varies with the value of the estate.  No fee would be payable for an estate worth less than £50,000.  But the executors would have to pay £6,000 if the estate is valued at £2 million or more – an increase of 3,770% from the existing fee of £155 where a solicitor applies for probate. (See notes 2 and 3 below).

Why does the Ministry of Justice want to raise the fees?

The new fees are expected to generate revenues of at least £145 million per annum in 2019-20, rising yearly in line with increases in estate fees.  The existing fees already cover the costs of running the Probate Registry.  The Ministry of Justice want to use the additional money to finance the operation of courts and tribunals dealing with litigation on issues unrelated to probate.

Is the Order ultra vires?

The Lord Chancellor has power under section 92 of the Courts Act 2003 to set the level of probate fees.  Section 180 of the Anti-Social Behaviour, Crime and Policing Act 2014 gives him power to charge “enhanced fees” - that is fees which exceed the actual cost of processing an application.

JCSI questions whether the Lord Chancellor would be acting within his powers by making the Order.  The report argues:

“Applying for probate is not to be compared with the commencement of proceedings. A person can choose whether to litigate and therefore whether to pay fees on issuing a claim ...  In contrast, executors have to obtain probate to allow them to administer an estate ... 

“This is an administrative process, akin to the registration of a life event.  Nobody applying for an uncontested probate would think for a moment that they were engaging in litigation.  That makes it difficult for the Committee to accept that a power to charge enhanced court fees can be extended naturally to require probate fees to reflect the general costs of the court and tribunal system”.

“Fees” or taxes?

The JCSI doubts whether the amounts provided for in the 2018 Order are “fees” at all.  It considers that a fee must bear some relationship to the service for which it charged.  The charges set out in 2018 Order have instead all the characteristics of taxation.  The Committee regards them as a type of stamp duty on estates, although dressed up as “fees”.

Did Parliament expect the Lord Chancellor to use powers in this way?

The JCSI also questions whether Parliament anticipated, when it conferred power on the Lord Chancellor to set “enhanced” fees, that it would be exercised in the way set out in the 2018 Order.  The Committee could find no evidence of the Government having suggested to Parliament, during the debates on section 180 of the Anti-Social Behaviour, Crime and Policing Act 2014, that enhanced probate fees would be used to fund the operation of the courts and tribunal service generally, or to provide for such large and immediate increases in fees.

The Committee’s report therefore draws the special attention of both Houses to the 2018 Order on the grounds that it appears:

• to be ultra vires – outside the Lord Chancellor’s powers; and
• to make an unexpected use of those powers.

It will now be up to the two Houses of Parliament whether to approve the Order in light of the JCSI’s report.

ENDS

Notes

1            The 2018 Order does not affect probate fees payable in Scotland or Northern Ireland.

2            The increase would be 2,690% from the existing fee of £215 in cases where executors apply for probate without using a solicitor.

3            The 2018 Order replaces an instrument laid before Parliament in February 2017 which provided for even larger probate fee increases.  The JCSI published a report in March 2017 drawing special attention to that instrument on the grounds that it appeared (a) to beultra vires, and (b) to make an unexpected use of the Lord Chancellor’s powers. That instrument was subsequently withdrawn by the Ministry of Justice.

The Joint Committee on Statutory Instruments

The Joint Committee on Statutory Instruments (JCSI) has 14 members – seven from the House of Lords, and seven from the House of Commons.

It scrutinises “statutory instruments” – legislation made by Ministers under powers conferred on them by an Act of Parliament.

The JCSI’s role is to assess the technical qualities of statutory instruments.  It does not look at their policy implications.  The JCSI can draw an instrument to the special attention of each House of Parliament on one or more of the grounds specified in the Standing Orders of each House, in particular that:

• the instrument is defectively drafted;
• it appears to make an unexpected use of the power conferred by the Act of Parliament under which it was made; and
• (most importantly) it appears to be ultra vires, in other words that the Minister is going beyond the powers to legislate conferred on him or her by the Act.

NB: The JCSI’s reports are advisory and they cannot stop legislation.  The Committee has no power to rule on whether an instrument is definitely ultra vires.  That is ultimately a matter for the courts to decide.