This is the headline in an advertising feature for a local law firm following the decision in the recent Court of Appeal case, Ilott v Mitson where an estranged daughter, whose mother had disinherited her and left all her property to three national charities, successfully challenged the Will and received an inheritance of approximately one third of the estate. The claim was pursued under the Inheritance (Provision for Family and Dependants) Act 1975 (the Act).
The case itself had been in and out of the courts since 2007. The daughter (Mrs Ilott) argued that her mother had not made sufficient financial provision for her in her Will. The judge in the original case agreed with her and awarded Mrs Ilott £50,000. Mrs Ilott appealed the decision to the High Court as she felt £50,000 wasn’t enough (and the charities cross-appealed that the original decision and quantum were wrong).
The High Court took the view that the original decision was wrong and that her mother (Mrs Jackson – Mr Mitson is merely one of two executors) hadn’t been unreasonable in disinheriting her daughter (so quantum was never at issue).
The Court of Appeal then allowed Mrs Ilott’s appeal against the High Court judge’s decision and the case was referred back to the High Court to consider quantum again. The (new) High Court judge decided not to interfere with the original decision of the district judge and the £50,000 award was reinstated. This led to another appeal and the recent determination of the Court of Appeal.
The Court of Appeal’s decision
Some key points in Lady Arden’s judgement (which the other two appeal judges concurred with) included:
- Her ladyship highlighted the words ‘for his maintenance’ in the Act emphasising that the provision so far as a child is concerned is, therefore, limited to awards of maintenance (although that’s not case with a spouse or civil partner). Her ladyship also stated that "Nor…is the court bound to limit maintenance to mere subsistence level”.
- Provision could be by way of a lump sum and not just by income payments.
- The charities, in this case, did not make any case that they have ‘resources and needs’.
- The court is entitled to look at future as well as present needs “The appellant is now in her fifties and has no pension”.
- The lack of any relationship between the daughter and mother shouldn’t deprive the daughter of an award “or substantially diminish it”.
What should we make of this decision?
The facts in this case were unusual. In particular, the appellant (Mrs Ilott) was on benefits and the testator had no connection with the charities that stood to benefit from her Will, nor did they articulate any discernible competing need (although this may form the basis of any appeal).
Against this background, the Court of Appeal arrived at a reasoned judgement and the judges were very clear that the appropriate provision was for maintenance only (although Lord Justice Ryder did comment that what is appropriate is a “value judgement to which courts must come” so each case must be considered on its own merits).
The situation would have been very different if the appellant had been of independent means or other beneficiaries had competing needs.
We do not believe the judgement is one that should have excited the press to the extent that some headlines concluded that “…a Will should make provision for dependants” “Where there’s a Will, there’s not always a way” “Want to disinherit your children? A court of law could have other ideas” or indeed “What’s a Will worth these days – not a lot – or at least much less – if a recent Court of Appeal judgement is anything to by". "Worryingly, those who make a Will cannot, as things stand, rest in peace knowing their assets will pass to their chosen beneficiaries and to no-one else”.
Thus, whilst claims of this sort may increase as a result of the publicity surrounding this case, we don’t see that this decision will have a great deal of impact on the an individual’s right to testamentary freedom.
What should I do now?
That said, to minimise the risk of a challenge testators should ensure that they discuss with their lawyer any situations that might give rise to a claim, in particular from:
- A spouse, who can make a claim for what ‘it would be reasonable in all the circumstances of the case for a husband or wife to receive, whether or not that provision is required for his or her maintenance’
- A child or children of the marriage or any other relationship
- Anyone else maintained by the testator (particularly where the level of maintenance has been substantial) – disputes involving mistresses have resulted in substantial payments from wealthy individual’s estates and increasingly elderly siblings are helping one another in later life.
In addition, where testators are proposing to favour one child over another or a charity over children the testator should explain the reasons for this, ideally during their lifetime but if that’s too difficult, in a letter of wishes. Testators should also establish a connection to any charity that is intended to benefit from an estate.
One option available to a testator to avoid a claim is to give away their estate in their lifetime.
Another safeguard might be to leave what’s called a conditional gift – bequeathing a sum of money to someone on the condition that they don’t challenge your Will.
That said, one of the difficulties that testators and lawyers face is that the circumstances that prevail when a testator makes their Will may change.
What about other claims from disinherited children?
Whilst claims under the Act are unlikely to substantially increase as a result of this case, we are increasingly seeing cases where children are challenging their parents Will on the basis of a lack of testamentary capacity, undue influence and for want of knowledge and approval of the contents of the Will. As testators get older and their immediate families fragment testators need to be sure that they take all necessary steps to avoid any of these circumstances being claimed. We will address this in a future article.