I often deal with cases arising from the lack of reasonable financial provision for a spouse or children under a Will, or where a person has died without completing a valid Will. I hope this article will help people avoid some of the most common problems in those situations.
While the starting point is that a person can (and any lawyer will tell you, should) make a Will saying how they want their assets (“estate”) distributed, there are also statutory, default, provisions in the Administration of Estates Act 1925 section 46 which sets out how the estate of someone who has died intestate, i.e. without leaving a Will, should be distributed.
In addition the Inheritance (Provision for Family and Dependents) Act 1976, section 2 allows the court to make orders to ensure that “reasonable financial provision” is made for the spouse and dependents of the deceased whether or not the deceased left a Will.
There can often be a degree of tension between those three regimes, even before you factor in the inevitable emotional and family stresses as a result of the death and any pre-existing family disputes.
In summary a person can make, pretty much, whatever provision they want in their Will, however a spouse or dependant can make an application to the court under the 1976 Act for a determination that the Will does not make reasonable financial provision for them and the Court will then consider a number of factors (set out in section 3 of the 1976 Act) relating to the financial resources and needs of the applicant and any beneficiaries, the deceased’s obligations to the applicant and beneficiaries, the size of the Estate, any disability of the applicant or beneficiary and any other matter including the conduct of a party, which the Court considers relevant.
The Court is also required to apply what’s known as the “divorce cross check” in the case of a spouse which involves determining what the spouse would have got if the parties had divorced instead of one of them dying and seeing whether that amounts to a reasonable provision.
If however someone dies intestate the 1925 Act provides for the spouse getting the deceased’s chattels (i.e. personal belongings and jointly owned assets which largely pass to the spouse by survivorship) and the first £250,000 of any assets (e.g. property, bank accounts, etc.) in the deceased’s sole name with the remainder split 50/50 between the spouse (on one side) and any children of the deceased on the other side. Spouses and dependants who are dissatisfied with their allocation under the 1925 Act can apply to the Court under the 1976 Act for an order making reasonable financial provision for them.
I have been involved recently in cases where a wife with an estate of over £800,000 left her cats £15,000 and her disabled husband £5,000 (the Court found that the husband was entitled to considerably more!) and where a husband left everything to his children but nothing to his wife (the Court, applying the divorce cross check, gave the wife over half of the Estate).
In another case a husband had prepared a Will very shortly before his death leaving everything to his second wife, but he had not executed (completed) the Will, so the three adult children by his first marriage, the second wife and her son were engaged in litigation to determine whether the second wife should get everything (in accordance with the wishes expressed in the Will) or half of everything (applying the divorce cross check) or whether the intestacy distribution applies and, if so, whether that made reasonable provision for the second wife and youngest child, given the child’s (expensive) plans to go to university.
I have also dealt with cases where the deceased has apparently forgotten they were married or that they had children (or how many children they had) or thought that they were divorced and made a Will on a basis that is clearly incorrect or fails to take account of a change in their circumstances (particularly marriage, divorce, or the birth of a child) and the Court had to become involved to decide the division of the Estate making appropriate provision for various family members.
All these cases started, obviously, with the death of a family member but then developed into emotionally-charged, painful and (inevitably) expensive litigation which could, often, have been avoided if the deceased, and later the parties, had taken professional advice at an early stage and had actively engaged in constructive discussions and/or mediation with the other side; the children wanting to follow their father’s wishes and divide the value of the house amongst themselves, hadn’t appreciated that when he died the father didn’t, in fact, own the whole house!
In Bleak House, Charles Dickens writes of the fictional cases of Jarndyce v Jarndyce where a very valuable Estate is the subject of litigation stretching over many generations, causing untold grief to the parties and ending up with the Estate being swallowed up in lawyers’ fees. Sadly, the position now is often no better (although, pre-Covid-19 at least, usually fractionally quicker).
So, what are the “take aways” from this article?
• If you haven’t written a Will, do so.
• If you have written a Will, check it’s up to date.
• In either case, get advice to try to ensure your wishes are realistic and would bear examination by a Court.
• If you are an Executor, spouse, beneficiary or dependant, consider getting advice on whether the deceased’s Will makes suitable provision for you (and others),
• If you are involved in (or about to become involved in) litigation about a Will get advice and consider negotiation or mediation as a quicker, cheaper and, often, a more effective and positive alternative.
The barristers of the Becket Chambers civil team can provide expert advice and assistance in Probate matters involving Wills and disputes regarding the distribution of Estates; in addition, Becket Mediation can provide experienced independent and impartial mediators to assist with the resolution of Probate disputes.
Please contact the clerks via firstname.lastname@example.org for further information