Written by Roger Peters
The Court of Appeal decision in Ilott has re-set long standing assumptions about the ability of adult children to make a successful claim for financial provision from their parents’ estates if excluded from a parent’s Will.
In the past there used to be an expectation, supported by the principle that under English law there is freedom of testamentary expression, that unless an adult child was actually being financially maintained by its parent- usually as a consequence of long term disability – an adult child could expect no help from the Inheritance (Provision for Family and Dependants) Act 1975, under which a Court could order reasonable financial provision from the deceased estate for a wife or other dependant for whom the Will or intestacy rules gave inadequate financial support.
The Inheritance Act sets out a number of features the Court must take into consideration. These include the reasons for and intention behind the decision to cut a child out of any inheritance. Being only a consideration, the decision was never in itself conclusive, but generally speaking evidence of the reasons would carry great weight, and it would be difficult for any adult child capable of work and suffering no disability to persuade the Court that it would be reasonable for some provision to be made out of the estate where none, or only a token amount, had been made.
While Ilott does not open the floodgates for every child to be able to resort to the Inheritance Act for additional financial support if disappointed by the provisions of the Will or intestacy, it does counsel caution in the case of children (and arguably grandchildren) who can be perceived to be struggling financially, even if the struggle is a consequence of their own behaviour. There is now a necessity for the parent who decides that any child should not benefit substantially under the Will, or equally with its siblings, to record at the time of making the Will not only the reasons for that decision but also the reasons why other beneficiaries are preferred; and those reasons must themselves be reasonable.
Merely disliking the life style or behaviour of the child and being estranged is not necessarily enough. In Ilott the considerations which weighed with the Appeal Court were the background to the breakdown of the relationship between mother and daughter, which was viewed as faults on both sides; the apparent absence of any previous support by the mother for the animal charities which benefited instead; and the poverty of the daughter’s family which was living on benefits. Even though the mother recorded not only her reasons for excluding her daughter, but also instructed her executors to resist any claim, the Court concluded that she had acted unreasonably, and taking other considerations into account, the daughter should have one third of the estate.
Although the charities who unsuccessfully defended the daughter’s claim are considering an appeal to the Supreme Court, the trend is clear, and cutting off the errant son or daughter with a shilling may no longer be guaranteed to succeed.
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I am senior partner at Gordon Dadds, working in both private client law and charity law. I began my career at the long-gone Peacock & Goddard, as an articled clerk and then assistant solicitor, before joining Gordon Dadds in 1973. I have 45 years post qualification experience and my speciality lies in estate planning and it is the challenge of getting this right both tax-wise and for the family dynamics that I find absorbing. Outside work, I enjoy spending time with my family, travelling and visiting restaurants. When I have time, I’m also passionate about reading, particularly about English history.