Keep up to date with latest legal developments
A key inheritance case reached the Supreme Court this month concerning three animal charities which have been fighting a case worth nearly £500,000 in legacies.
The case started as a claim for reasonable financial provision under legislation known as the Inheritance (Provision for Family and Dependants) Act. The claim was brought against the estate of the late Mrs Jackson by her daughter, Mrs Ilott. The two had been estranged for much of the 26 years proceeding Mrs Jackson’s death.
Mrs Ilott, who is now married with five children and largely living on benefits, left home against her mother’s wishes at aged 17 to live with her then boyfriend. In her last will, Mrs Jackson left the majority of her estate to a number of charities, and made no provision for her daughter. Mrs Ilott had been aware of the terms of her mother’s will and had lived without any expectation of benefitting from the estate.
The District Judge who first heard the case found that Mrs Jackson’s will did not make reasonable financial provision for Mrs Ilott and awarded her £50,000.
The charitable beneficiaries under the will initially challenged the judgement, but that challenge failed. However, Mrs Ilott then also appealed on the basis that the size of the award was too low.
The Court of Appeal found that the District Judge had made two errors in his approach to the case.
Firstly, he had decided that the award should be limited due to the long estrangement and lack of expectation of benefit, but he did not identify what the award would otherwise have been.
Secondly, he gave his judgement without knowing what the effect of the award would be on the benefits which Mrs Ilott and her family received.
The Court of Appeal awarded Mrs Ilott £143,000 to buy the home she lived in, and a further £20,000 (payable in instalments to avoid affecting Mrs Ilott’s benefits entitlement).
The Supreme Court has unanimously allowed the charities’ appeal against this decision.
They have stated that the District Judge did not make either of the two errors which the Court of Appeal referred to when changing his award. Consequently, the Court of Appeal’s order will now be set aside and the District Judge’s original order reinstated.
The case confirms existing law that an appeal will not succeed unless the judge of first instance has made an error of principle. Appeal courts are not there to effectively re-try a case where from scratch.
So what does all this mean for people making their Wills today?
The Supreme Court justices were at pains to point out the unsatisfactory state of the present law in this area. It gives no real guidance as to the factors to be taken into account when deciding whether an adult child is deserving or not of reasonable maintenance following a claim of this kind against an estate.
Adult children of a deceased person will continue to be able to bring a claim where a will or the rules of intestacy fail to make reasonable financial provision for them. However, this judgment is welcomed by those who felt there was a need for the law to support the wishes of the deceased and the judgement can be interpreted as a ‘victory for testamentary freedom’.
It is important to realise that the so-called ‘Inheritance Act’ was never intended to be a vehicle for disgruntled adult children to challenge their parents’ testamentary wishes just because they considered a will to be unfair. In effect, the Supreme Court justices have confirmed this and upheld Mrs Ilott’s award only to the extent that it made reasonable financial provision.
If you are considering making a will which does not provide (adequately, or perhaps at all) for people reasonably expected to benefit from your estate, such as children, a spouse or cohabitee, then you should take legal advice. That way you are aware of the risks and what you may be able to do to address them.