Soft targets
Fiona Campbell-White explains the steps to take when you are approached by a client who wishes to challenge a will that benefits a charity
Disappointed beneficiaries, particularly if they are family members of the deceased, regularly object to the terms of the deceased's will purely on the basis that 'it is not right' that 'so much' should go to charity rather than the deceased's family.
When faced with such claims, the first task for charities and their lawyers will be to ascertain whether or not the disappointed beneficiary has a valid claim at law, as opposed to an understandable (but unactionable) grievance about not having been left more of the deceased's estate. And as a solicitors, you may need to explain to your client a testator's freedom to make a capricious will.
A view often taken by disappointed beneficiaries is that it is worth challenging a will which benefits a charity on the basis that the charity will not want to incur the time, costs, or mere hassle of defending a challenge, particularly where negative PR can be threatened or implied. While this may be true in respect of some small charities, it is far from the reality in the vast majority of cases. Charities should not be seen as a soft touch.
Duty to defend challenges
Income received from legacies is often of fundamental importance to a charity and the charity will not be prepared to give up its entitlement to this income lightly. Indeed, charity trustees have a duty to preserve the charity's assets for the benefit of its charitable objectives; the trustees will not be at liberty to simply cave in to any challenge made to a legacy due to the charity.
A charity has far less freedom than, say, a private individual, to compromise a claim made against it. It will only compromise a challenge to a legacy due to it if that claim has merit or it is otherwise in its interests to do so. A disappointed beneficiary should not, therefore, expect an easy ride when putting forward a challenge to a will that benefits a charity. Instead, the disappointed beneficiary should expect to detail his claim (and support it with evidence) in the usual way.
Many charities that receive a significant legacy income employ legacy officers or other employees whose tasks specifically include (or even exclusively cover) dealing with such income. Legacy officers may well have more relevant experience than you in dealing with challenges to wills. They will, therefore, both recognise a spurious claim and expect claims with any merit to be properly presented.
Negative publicity is a popular threat made against charities; albeit one that is usually made when the challenging party is getting desperate and it thus can be seen as indicative of a weak legal claim. By and large, charities are more PR savvy than they used to be and they are well placed to deal with publicity should it arise. The standard threat to go to the press about costs being spent by a charity on legal fees defending a legacy can be simply and effectively countered by the charity explaining how it is in the interests of the charity to defend the legacy and pointing out that the charity believes that it is honouring the deceased's wishes in doing so. Indeed, many charities point out that being seen as an easy target as far as challenges to their legacies are concerned can create negative publicity of its own, putting testators off leaving them legacies and, as such, they are quite happy to take a robust stance in response to public challenges.
Using ex gratia payments
If a disappointed beneficiary does not have a valid legal claim, he may still want to seek a payment from the charity on the basis that he has a moral claim to the testator's estate (or part of it). This can be encouraged by legal advisors who have heard that charities have the power to make ex gratia payments. Where charity trustees regard themselves as being under a moral obligation to make a payment out of the charity's funds to a disappointed beneficiary they can seek authority from the Charity Commission (or the court) to make an ex gratia payment. However, it is rare that a scenario will arise in a legacy context in which the trustees of a charity will feel that if the charity were an individual it would be morally wrong of it to refuse to make the payment requested by the disappointed beneficiary. Indeed, the court has warned charities that the power to authorise ex gratia payments 'is not to be exercised lightly or on slender grounds' (Re Snowden [1970] 1 Ch 700). It is also worth noting that the threat of negative publicity is not likely to persuade the Charity Commission that the charity trustees feel under a moral obligation to make the payment as it is unlikely to consider this to be an effective justification for making an ex gratia payment when set against the potential reflection on the good name of the charity if it turns away gifts made to it.