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An affirmation of testamentary freedom? Ilott v Mitson ([2014] EWHC 542 (Fam))

An affirmation of testamentary freedom?

Ilott v Mitson ([2014] EWHC 542 (Fam))

Reported cases of claims brought under the Inheritance (Provision for Family and Dependants) Act 1975 (“the 1975 Act”) are few and far between. The nature of such claims mean that most cases are settled out of Court and away from the public eye.

The Court of Appeal’s 2014 judgment in Ilott v Mitson provides some much needed insight into the Court’s approach to 1975 Act claims and in particular its approach to claims brought by independent adult children.

The claim so far

The Appellant brought a claim for reasonable provision under the 1975 Act from her mother’s estate.

She claimed that her mother’s will, which had completely disinherited her in favour of a number of animal charities, did not make reasonable provision for her maintenance and that a share of the estate should be redirected to her as a result.

This was despite the fact that the daughter had left home at the age of 17 and had seen her mother only twice since then and that the mother had cited this as a reason for excluding her daughter in letters accompanying her last will.

Furthermore, the daughter was an independent adult and it has proven notoriously difficult in the past for such claimants to bring a successful claim.

In 2011 the Court of Appeal confirmed the decision made at first instance and allowed the daughter’s claim. In principle the Appellant had not been reasonably provided for and was entitled to some financial provision.

Although the Court of Appeal made it clear that this decision turned on the particular facts of the case, and indeed that all claims under the Act were by their nature fact specific, it nevertheless caused some alarm.

As a minimum, the decision seemed to introduce an element of uncertainty where claims by adult children were concerned, but some also feared that the judgment could be construed as opening a channel for adult children to claim a share of their parent’s estate as of right and in so doing restrict the principle of the freedom of testamentary disposition.

The Appellant’s arguments on quantum

Having dismissed the Respondents’ cross-appeal, and thereby confirming that adequate financial provision had not been made for the Appellant under the will, the claim was then returned to the High Court so that the daughter’s original appeal on quantum could be decided.

At first instance District Judge Million had decided that £50,000 (approximately 10% of the deceased’s estate) would constitute appropriate provision for the daughter.

The Appellant maintained that she should receive a far greater award.

On appeal, the Appellant’s arguments included the following:

  • that if her lack of expectancy in relation to her mother’s estate had not prejudiced her case that she had not been adequately provided for (the “gateway” stage of the claim), it should not prejudice any subsequent decision regarding quantum, and
  • that having found that reasonable provision had not been made, it could not then be reasonable to award a lump sum of £50,000 as this would realise little benefit for the Appellant, once to reductive effect upon her state benefits was taken into account.

Accordingly, the daughter submitted that reasonable financial provision would be an amount that would serve to re-house her and her family, as she would no longer have to rent her property from the housing association and it would also ensure long term provision for her future. This amount would equate to half of the deceased’s estate.

Counsel for the Appellant submitted that any capital over £16,000 would reduce pound for pound the benefits to which the Appellant would otherwise be entitled, unless such monies were used for the purchase of a home.

The decision 

Mrs Justice Parker dismissed the Appellant’s appeal in respect of quantum, confirming that the district judge’s original award of £50,000 should stand. It was held that the considerations for the Court as set out in section 3 of the 1975 Act were relevant both to the question of whether adequate financial provision had been made for the claimant under the relevant will and to the amount that should be awarded to the claimant if adequate provision had not been made.

However, these considerations would not apply equally to both stages. Consequently, the daughter’s lack of expectancy in relation to her mother’s will did not prevent the lack of provision under the will from being unreasonable at the “gateway” stage of the claim, but it would operate to limit the award when it came to quantifying the amount that she should receive as a result.

The judge similarly dismissed the Appellant’s argument that she would receive no real benefit unless she was re-housed. It was held that the Court should not be compelled to make provision for such a significant proportion of the estate simply because the Appellant submitted that she would not otherwise receive sufficient benefit from the award.

This could not be the right approach and, having regard to the circumstances of the case, it was not appropriate to meet the Appellant’s housing need. In any event, the size of the estate in this case was not sufficient to allow the daughter to be both housed and provided for in the long term.

As such, it was not possible to make any award that would take her out of the benefits regime. Mrs Justice Parker confirmed that the purpose of the award was to provide a capital amount to the Appellant for her to improve her circumstances as she saw fit.

Furthermore, it was noted that due regard must be paid to the deceased’s intentions which had been made very clear at the time of preparing her will.

Consequences in practice

This modest award for provision for the Appellant should extinguish any lingering uncertainty as a result of the Court of Appeal decision in 2011.

The latest judgment suggests that a successful claim brought by an independent adult child may only elicit an award of a small proportion of the deceased’s estate, even when the Court is aware of the claimant’s straitened financial circumstances.

Whilst on these particular facts it was found that adequate financial provision had not been made for the Appellant, notwithstanding an express wish by the deceased that her daughter receive nothing from her estate, the Judge made it clear that the relevant considerations would carry different weight when it came to deciding quantum.

Mrs Justice Parker’s judgment would also suggest that the testator’s wishes are still a key consideration and where there is no expectation of receiving an inheritance this will impact upon the amount awarded.

This decision would therefore appear to limit the force of adult children’s claims under the 1975 Act and reaffirm the principle that a testator is in the main free to dispose of his property on death as he wishes.

This should allay concerns amongst practitioners that the 2011 decision signalled a move towards the forced heirship provisions found in other jurisdictions such as France.

Accordingly, the judgment should provide some reassurance for those wishing to leave an estate to charity or to otherwise overlook an adult child, although practitioners should bear in mind that a will made in such terms may still be susceptible to a challenge under the 1975 Act.

This article was written by Bart Peerless.

For more information please contact Bart on +44 (0)20 7203 5274 or bart.peerless@crsblaw.com