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Bernard Matthews’ children lose High Court case

The adopted children of businessman Bernard Matthews lost their case at the High Court yesterday (5 September 2012) in relation to the inheritance tax (IHT) liability they face on their late father’s villa in France.

6 September 2012

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The turkey tycoon’s three children, whom he adopted with his wife Joyce, had argued that the £2m IHT bill on Villa Bolinha in the south of France that they inherited after his death in 2010 should be paid out of Matthews’ English estate.

However, Judge Nicholas Strauss QC, sitting at the High Court, said that: “I hold that the adopted children have no right under the English will to have their tax liability discharged, or to be reimbursed if they have paid it.”

Judge Strauss rejected the trio’s argument on the basis that Matthews’ had not wanted his adopted children to have any part of the French home.

Katheleen, Victoria and Jason had not been left the property in Matthews’ will, but rather had asserted their claim to the £12m villa under French inheritance law, which decrees that 75 per cent of his property must go to family.

Matthews had expressly stated his wish that, after his death, his French mistress of 23 years, Odile Marteyn, should be allowed to keep the Mediterranean mansion.

In a letter to his wife and children before his death he wrote: “Odile has supported me unfailingly for many years and particularly so during my recent illnesses. Without such support, I might not have been able to continue directing our family company for our mutual benefit.”

He added: “In reaching my decision I have taken into account the fact that each of you is very well housed with at least one property each and that, directly or indirectly, I have provided financially for each of you over a very long period of years.

“I wish the French villa to continue to be occupied and enjoyed and consider Odile would be the best person to take on this responsibility”.

However, deputy High Court judge Strauss heard that Matthews’ wishes had been “disregarded” by the adopted children and Marteyn had been left with less than a half share in the villa.

Matthews also had a son by Cornelia Elgershuizen called George who inherited much of the his estate and who had respected his wishes in regard to Villa Bolinha. As the adopted children did not, Marteyn could only inherit 43.75 per cent.

For the full case digest, see http://www.privateclientadviser.co.uk/feature/international/case-digest-scarfe-v-matthews

Categorised in:

Tax & Wealth structuring Wills, Trusts & Probate