A recent television documentary has put the spotlight on will disputes.
‘Inheritance Wars’ on Channel 5 covers a number of inheritance disputes between family members, often with devastating financial consequences for the “losing” party.
Disputes about inheritance can take a variety of forms, such as challenging the validity of a will. This might be for technical reasons, on grounds of a lack of capacity, or on grounds of undue influence – as I have previously written about here.
In England and Wales, where there is a valid will, there are no heirship rules (a proportion of the estate automatically passing to the deceased’s children, spouse, or relatives).
In theory, under our laws the person who made the will has the freedom to leave their estate to whomever they wish.
In practice, the position is not so simple. Claims made under the Inheritance (Provision for Family and Dependants) Act 1975 are becoming more popular. That law allows certain people to bring a claim when a will is valid, but they feel it does not sufficiently provide for them. This might be on the basis that they were cut out of a will entirely or are only left a limited sum.
The legislation allows the court to effectively alter a will (or the intestacy rules) so that a successful claimant receives reasonable financial provision from the estate.
Who can apply to contest a will?
The following individuals qualify as claimants under the legislation:
• the spouse or civil partner of the deceased
• the former spouse or civil partner of the deceased (as long as that person has not remarried/entered into a subsequent civil partnership)
• a person who, for the two years prior to the death, was living with the deceased as if they were a spouse or civil partner
• a child of the deceased
• a person who was treated as a child by the deceased
• any other person who was being maintained, either wholly or partly, by the deceased prior to their death.
What will the court consider?
Qualifying claimants are not automatically entitled to an award being made, as many appear to assume. The court will consider all the circumstances when deciding whether to make an award.
The court must consider whether the will (or the intestacy rules) make reasonable financial provision for the claimant. If not, the court may award further provision from the estate.
Courts require claimants to demonstrate they are in financial need, and that the deceased had some form of obligation (moral or otherwise) to provide further for them. The court will look at the circumstances of the claimant (and other claimants), such as their financial position, their employment status, their age, and any health issues.
If an application is successful, the court can make a range of awards, including a lump sum or periodic payments; transferring property into the claimant’s name; or allowing them the right to live in a property for the remainder of their life.
Often, individuals become aware of their ability to apply to court, and they do so. However, just because legislation gives you the ability to claim, does not necessarily mean you have sufficient grounds to bring a claim.
The decision to litigate is often fuelled by grief, and the individual feeling that they have been “wronged”. The brief window within which court proceedings must be issued (within six months of the grant of probate) adds an element of urgency. Those factors are a dangerous cocktail.
I am increasingly seeing cases which are brought speculatively, and often under no-win, no-fee agreements, the prospects of which are clearly weak. Those claims are often against very modest estates. I see claimants using distasteful tactics to seek to add pressure, which in turn increases costs, in the hope of forcing an out of court settlement.
I find that approach baffling. Claimants often do not consider the fact that after a claim is issued you cannot simply walk away from the case without the agreement of the other party, otherwise they will be liable to pay the other party’s legal costs. Also, using distasteful tactics not only heightens tensions between the parties, but it often increases legal costs to a level where a settlement is no longer a viable option.
If the case goes to a final hearing, the party deemed to be the “losing” party is often ordered to pay the other party’s legal costs, as well as bearing their own costs. I see numerous cases where such costs amount to £35,000 – £70,000, which is quite the personal burden for anyone. The documentary showed one high profile case where costs exceeded £700,000.
Parties on both sides of cases should tread very carefully. The purpose of this blog is not to deter genuine claimants from bringing a claim, or to deter beneficiaries from defending a case if it is reasonable to do so – far from it. It is to urge parties to seek clear and honest legal advice before litigating. That will help you assess risk and it may even inform you on how you are best approaching matters.