Private Wealth - Thy Will Be Done

The Telegraph put the story on its front page with the headline 'Your Will can be ignored, say Judges', mindful perhaps of the fact that a large proportion of its readers spend a great deal of time thinking about their financial legacy.

But to what extent is this really true? And what can individuals do to ensure that if they decide to leave their Estate to the proverbial cats’ home, or as in Mrs Jackson's case, a number of animal charities, that their Will is not later set aside?

The facts in Ilott v Mitson were that Melita Jackson, a widow, became estranged from her only child, Heather Ilott, when at the age of 17 Heather left home to live with Nicholas Ilott, whom she later married.

When Mrs Jackson made her Will she took great care to ensure that her daughter would receive nothing and by the time of her death in 2004 the pair had been estranged for 26 years.

However Heather Ilott, an unemployed mother of five largely dependent on state benefits challenged the Will under the Inheritance (Provision for Family and Dependents) Act 1975 ('the Act').

Last month after a decade long battle she was successful in getting her previous award of £50,000 from her mother's Estate increased to  £164,000. This was from an Estate of just under £500,000 and was enough to enable her to buy her housing association property in Hertfordshire.

A number of categories of applicant may bring a claim under the Act, including spouses, civil partners, cohabitants and children. If an applicant falls into one of the categories outlined in the Act then the Courts must apply a two stage test. The first question is whether reasonable provision has been made for the applicant, this is an objective test based on considerations of matters outlined in section 3 of the Act, such as the size and nature of the Estate and the resources and needs of the applicant as balanced against those of the other beneficiaries.  In the case of all applicants who are not spouses or civil partners, the test is whether the provision is reasonable for the applicant’s maintenance.

If the Court decides that reasonable provision has not been made then the second stage of the test is that the Court must then consider how to exercise its power under the Act.

Generally speaking the Courts have shown a reluctance to make awards to able bodied sons and daughters in employment (see for example the case of Re Coventry). However Mrs Ilott’s case is an unusual one. As an impecunious mother of five dependent on state benefits she was clearly in dire need of funds, and the other beneficiaries were charities with which Mrs Jackson had no known connection during her lifetime. Mrs Jackson’s moral obligation towards the charities was questionable. On this basis it is likely that a less impoverished claimant would have failed to succeed.

So what should an individual consider when making a Will which may not treat every member of his family equally? First it is important to leave a letter to be kept with the Will explaining the rationale behind the decision. For example if one child has already received a large amount of money during the testator's lifetime, and the others have not, and this is clearly documented, then any challenge is unlikely to be successful.

The person making the Will should also ensure that the solicitor drafting the Will understands the position and makes a good and clear note of the situation. It may be worth asking the solicitor to write a letter outlining the situation to be kept on the Will file. It is also worth considering a forfeiture clause. Such a clause means that anyone challenging the Will will forfeit the gift that they do receive under it.

So the law has not changed. The facts of Ilott v Mitson are extreme which is why the judge found that the provision for Mrs Ilott was not reasonable in all the circumstances. Each case will turn on its own facts meaning we are a long way from forced heirship. However what is increasingly clear is that the number of Will challenges is on the rise and those wishing to exclude close family members from inheriting, should take expert advice before making a Will.

Angharad Lynn

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