Recent challenges to wills

In the case of Ilott v Mitson [2015] EWCA Civ 797, the deceased, Mrs Jackson, left her £500,000 estate to three charities, subject to one small legacy, to the exclusion of her only daughter, Heather Ilott.

Jackson and Ilott had been estranged for 26 years, following Jackson's disapproval of her daughter's relationship with her now husband. Jackson was clear when drawing up her will that she did not want her daughter to benefit in any way from her estate and requested that her executors fight any claim that her daughter
might make.

The resulting legal fight over Jackson's estate ended in the summer of 2015 with Ilott being awarded £164,000 (around one-third of the estate) by the Court of Appeal under the Inheritance (Provision for Family and Dependants) Act 1975. Under the 1975 Act, disappointed beneficiaries, if they fit within one of the Act's categories of claimant, can challenge a will or the intestacy rules to increase or obtain a share of
an estate.At the beginning of March 2016, it was announced that the charities had been granted leave to appeal to the Supreme Court, which will decide whether Ilott's award should be lowered to £50,000, the award made at first instance. The court will also look at whether the Court of Appeal erred in its approach to the 'maintenance' standard under the 1975 Act, or if it was wrong to structure an award in a way which allowed Ilott to maintain her entitlement to state benefits.

As justification for the appeal, the charities have cited the implications of the decision for future charitable legacies, arguing that people need to know whether they can safely make such gifts. Additionally, the charities argue that the Court of Appeal decision sets a precedent for successful claims by children in financial difficulty who have been left out of a will, and may encourage further challenges; if the Supreme Court can give clarity on the viability of a successful claim by such children, it may make it easier to settle future disputes.

The appeal is unlikely to be heard for another 18 months, but is sure to be a landmark ruling in this important area.

Divorce and cohabitation

The issue of finality in a divorce settlement was tested in Chekov v Fryer [2015] EWHC 1642 (Ch). This case concerned a divorced couple who then cohabited. On the death of Mr Fryer, Mrs Chekov brought a successful claim under the 1975 Act as a cohabitee, despite the terms of their divorce including that neither party could claim against the other's estate on death.

The case highlights that if you continue to cohabit with your former spouse for over two years (thus bringing you within the claimant category of 'cohabitee' under the 1975 Act), then the surviving former spouse may be entitled to claim a share of your estate. With rising house prices it is not inconceivable that this state of affairs will start arising more frequently, and care needs to be taken.

Inheritance rights of cohabitants

The recent case of Joy Williams, held on 16 February 2016 at the Central London County Court, concerned a common law widow who had to bring a claim under the 1975 Act to secure her home. The case highlights that, without a marriage certificate or civil partnership agreement, cohabitants do not have any rights over their partner's estate.

In Williams's case, despite living with her partner, Norman Martin, for 18 years, she had no entitlement by law to a share of his assets. Mr Martin had not divorced his wife or made a new will. On his death, his estate passed under the terms of his will to Mrs Martin, including his half-share of the property he owned with Williams. As a result, Williams co-owned the property with Mr Martin's estate and faced the prospect of her home being sold so that Mr Martin's half-share could be given to Mrs Martin.

Williams successfully claimed Mr Martin's half-share in the property under the 1975 Act, putting right what many consider should have been her entitlement by law in the first place.

The case is a reminder that cohabiting couples need to be proactive about providing for one another on death and carefully consider their form of co-ownership of property. The Cohabitation Rights Bill is currently being considered by parliament, but until there is progress, a will is the only way of ensuring that assets pass from one cohabiting partner to another. There is no protection for cohabitants in the intestacy rules.

We understand Mrs Martin plans to appeal Williams's award, and it will be interesting to see whether this develops.

Low-cost wills

The case of Tinuola Aregbesola also concerned the ownership of property, as well as a claim against Barclays for a badly drawn-up will. Ms Aregbesola's father, Ebenezer Aregbesola, had a jointly owned property and intended his half-share to pass to his daughter, instructing Barclays to prepare his will along these lines (for a fee of £90). However, Barclays omitted to sever the joint tenancy, meaning Mr Aregbesola's share of the property passed by survivorship to his surviving spouse on his death.

The Financial Ombudsman Service was involved, saying that Barclays should fairly and reasonably resolve the complaint. However, Barclays refused to compensate the daughter on the basis that its will-writing service was unregulated and it was not therefore bound by the ombudsman's findings.

The case, which reached the High Court last year, highlights the growing problem of using low-cost will services, or making a DIY will.

WH Smith heirs

A contentious probate story that has hit the headlines recently relates to a dispute between the current 5th Viscount Hambleden, heir to the WH Smith fortune, and his step-mother over unpaid debts.

It has been reported that the step-mother promised to sell a property in California and use the funds to repay loans owing to the late 4th Viscount Hambleden. The property was sold but the step-mother allegedly failed to repay, leaving the debts standing due to the 4th Viscount's estate on his death. An out-of-court settlement was reached, yet the 5th Viscount maintains he has not received all that was owed to him.

On death, any debts owing to the deceased are an asset of the estate, and will be included in the estate for inheritance tax purposes unless there is any waiver in the will. Executors are required to make suitable enquiries of the family about any debts owing, and their ability to bring a claim is greatly enhanced if there is a formal loan agreement documenting the loan. It will be interesting to see whether the 5th Viscount takes further legal action in this case.

These cases all highlight the need for careful thought and professional advice on the preparation of a will. Seeking the right advice and considering all potential pitfalls should help avoid a challenge on death.

Of course, grief can do funny things, as can greed, and the 1975 Act is there to assist those who feel inadequate provision has been made for them. If a testator acts with a capricious and vindictive streak and deliberately cuts out a family member, leaving their estate to a third party they seemly had no connection with, they should be advised that a claim may follow.

However, with professional advice come options. A testator who is advised to leave a carefully worded letter of wishes giving details of their actions and thought processes may help guard against any potential claim from disgruntled beneficiaries; if not, this provides evidence of rationale in any future court case. Equally, taking proper advice when preparing a will to ensure that issues like the succession to a co-owned home are dealt with will save disputes, costs, time, and anxiety in the long run, and can you put a price on that? SJ

Andrew O’Keeffe, pictured, is a partner and Caroline Cook a senior associate in the specialist contentious trusts and probate team at Wedlake Bell