Keep Your Friends Close and Relatives Closer – The Risks of Disinheriting Your Dependants
Unusually for an inheritance dispute, the Ilott v Mitson case caught the attention of the media last week. Whilst contested inheritance claims are not uncommon, the most recent decision by the Court of Appeal has attracted a high level of editorial interest for a number of reasons.
The case itself is straightforward enough. Helen Ilott’s mother (Melita Jackson) died in 2004 leaving an estate worth £486,000 to three animal charities. Helen, who had not been in contact with her mother for many years before her death, was left nothing. Jackson’s will and supplementary instructions made it very clear that her daughter had been disinherited. Ilott brought a claim under the Inheritance (Provision for Family and Dependants) Act 1975, which gives dependants the grounds to challenge a will, when the deceased has not made sufficient provision for them. Ilott’s claim was based on her and her family’s very low income.
Following a long and tortuous journey through the courts, the most recent decision of the Court of Appeal was to award Ilott £164,000. The decision was unexpected for two reasons.
Firstly, although challenges to wills due to inadequate provision for dependants are relatively common, claimants usually have to show that they are directly dependent on the deceased and are typically unable to work. However, in this case Ilott had had no contact with her mother for several years, received no financial support from her and was capable of working, although she was in receipt of state benefits at the time of her mother’s death.
Secondly, in their decision to award Ilott a third of her mother’s estate, the Appeal Court pointed out that Mrs Jackson had no direct connection with the three animal charities to which she left her estate. Her intention was simply to give the legacy as a donation. The court felt that there was no clearly demonstrated ‘expectation or need’ by the charities and so adjusted the distribution of the estate.
So what can be made of the Court of Appeal’s decision in relation to estate planning and the drafting of wills? The decision to uphold an appeal, from an independent adult child, widens the net of potential claimants. It serves as a reminder to professionals involved in drafting wills to advise clients of the substantial risks of disinheriting close relatives and dependants. They may want to cut their nearest and dearest out of their will, but the courts may have other ideas and have the power to change the final allocation of the deceased’s estate. Indeed many will writers require people making a will, who are intent on disinheriting their closest relatives, to sign a statement confirming that they understand the consequences of their actions.
In addition, legacies to charities may have to be considered in terms of the deceased’s contact with the charity, especially if there is the possibility that the will may be contested. That said, the Appeal Court made its final judgement by balancing the needs of the charities against the needs of the claimant and still concluded that they should retain two thirds of the estate.
But this may not be the end of the matter as far as inheritance claims are concerned. An appeal to the Supreme Court is being considered by the three charities, which may bring the whole issue to our attention once again.