Section 4 Inheritance (Provision for Family and Dependants) Act 1975: How Long is Too Long to Ask for Permission to Apply for Reasonable Financial Provision From the Estate of the Deceased?

Section 4 of the Inheritance (Provision for Family and Dependants) Act 1975 (“the Act”) provides that claims under section 2 of the Act must be made within six months of the date on which the representation with respect to the estate is taken out, unless the court gives permission for such a claim to be made after that six month period. Two recent authorities indicate somewhat contrasting approaches when considering the length of any such delay.

Case Law

In Bhusate v Patel [2019] EWHC 470 (Ch) the claimant’s husband died intestate in 1990, entitling the claimant to a statutory legacy and a one half share in the residuary estate, which was effectively the home in which she lived. Whilst a grant of letters of administration was taken out by the executors, who were two of the deceased’s children from his first marriage, the estate was not administered and the claimant continued living in the property. She did attempt to sell the same but the deceased’s children obstructed the sale, thus it remained registered in the name of the deceased. In 2017 the claimant brought proprietary claims together with a claim for payment of a statutory legacy and capitalised life interest (together with statutory interest), however the deceased’s children successfully applied to strike out those claims. As such the claimant made a claim under the Act, requiring permission pursuant to section 4 thereof, as by that stage it was made 25 years and 9 months after the expiry of the deadline for so doing.

The court granted the claimant permission to bring the claim, referring to the strong merits of the claim, the delay having been explained, the actions of the deceased’s children (including obstructing the sale of the property), the estate not having been administered, and the fact that if the application was not granted the claimant would be left homeless.

When considering the delay Chief Master Marsh stated:

“It is of course right that the period of delay is very long indeed. It is not correct, however, to say that the period of delay itself has the inevitable consequence that the application should be dismissed, accepting of course that the longer the period of delay, the greater the burden the claimant has to discharge. In this case, as I will explain, the length of time that has elapsed is not a factor that only creates difficulty for the claimant. It is also a circumstance that may count in her favour in light of the obstructive behaviour of the 2nd to 5th defendants.”

This approach to delay is somewhat different to that adopted by Mr Justice Mostyn in Cowan v Foreman and others [2019] EWHC 349 (Fam). In that case probate was granted on the 16th December 2016, thus the six month deadline expired on the 16th June 2017, the application for permission being made on the 8th November 2018, some 17 months following its expiry.

The deceased had effectively placed his estate in two trusts, primarily it would seem for tax purposes, for the benefit of the claimant (the wife of the deceased) and their grandchildren, however the claimant subsequently took issue with the manner in which the trustees were exercising their discretion and sought to make a claim under the Act. A moratorium, commonly referred to as a standstill agreement, was entered into on the 7th December 2017 (some six months after the expiry of the six month deadline), which expired on the 1st May 2018. Mostyn J effectively disregarded the period covered by the moratorium, determining the case on the 13 month delay. In so doing he commented:

“In my judgment there are no good reasons justifying the delay for that aggregate period of 13 months. The period of delay is very substantial: more than twice the period allowed by Parliament for making a claim. In my judgment, absent highly exceptional factors, in the modern era of civil ligation the limit of excusable delay should be measured in weeks, or, at most, a few months.”

With regard to the somewhat common practice of utilising a standstill agreement Mostyn J stated:

“…I suggest that in no future case should any privately agreed moratorium ever count as stopping the clock in terms of the accrual of delay. Put another way, a moratorium privately agreed after the time limit has already expired should never in the future rank as a good reason for delay.”

Guidance

As can be seen from the above, it remains the position that there is no definitive time limit within which applications for permission must be brought, and the determination of the test will be based on the court’s consideration of the applicable factors. However I would suggest that careful consideration be given to the use of standstill agreements. What is apparent following Cowan is that such an agreement should not be entered into after the expiry of the six month deadline under the Act. Moreover it would seem that if additional time is required to attempt negotiation, the safest approach to take to avoid any issues with regard to limitation is that the claim is issued within the six month deadline and then immediately stayed to allow such discussions to take place.

Whilst Cowan does not state that moratoriums entered into prior to the expiry of the deadline will not be effective, if the claim has been issued prior to that expiry, then no issue can arise in that regard.