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Ilott v Blue Cross – a dead end for Inheritance Act claims?

Abha Pandya | Brighton Solicitor | Griffith Smith Farrington Webb

31st May 2017

The Court of Appeal had allowed an appeal in respect of the trial judge’s decision to award the claimant £50,000 and substantially increased that sum to approximately a third of the £450,000 Estate.

The Supreme Court re-instated the trial judge’s decision as it did not agree with the Court of Appeal that the trial judge had erred in principle or in law and thus re-instated the original decision.

A claim against an Estate of a deceased by a spouse, child or other dependant can be made under the Inheritance (Provision for Family and Dependants) Act 1975 (“the Act”). The purpose of the Act is to allow a claim to be brought where, either as a result of the intestacy rules or by the terms of the will, a party is not reasonably provided for.

Lord Hughes gave the leading judgment setting out the Act, and previous cases such as In re Dennis and In re Coventry emphasising that under English law, “an Englishman still remains at liberty at his death to dispose of his own property as he wishes”.

The original trial judge’s decision was upheld as he had not erred in principle or in law. In his summary of the law, Lord Hughes explained that the reasonable financial provision test was an objective one and that provision was “judged not by subsistence levels but by the standard appropriate to the circumstances”.

There is concern among some legal commentators that Lord Hughes’ observations as to the law question whether Mrs Ilott’s claim ought to have succeeded at all, in particular given the long estrangement of the parties. Section 3(1)(g) of the Act is a ‘catch-all’ type provision but Lord Hughes observes that the wishes of the deceased and the relationship of the parties are pertinent to such claims and fall to be considered under that provision. Such factors help to decide whether or not there has been reasonable financial provision.

It is not essential to consider specifically what reasonable financial provision might have been in order to answer the question of whether there has been reasonable financial provision; indeed the nature of the deceased and the claimant’s relationship affects whether financial provision that has been made is reasonable, and if none, whether that was reasonable in the circumstances.

The restatement of the law and the observations of Lord Hughes do suggest that it will be harder for those left out of a will to argue that they are entitled to a share but it is the factors under section 3(1) of the Act that are key. If the potential claimant was dependent on payments from the deceased towards living expenses at the time of death, notwithstanding any hostility or estrangement from the deceased at the time of death, there would be merit to his claim.

The decision helps by providing clear guidance to claims and also by underlining that reasonable financial provision will vary depending on the circumstances of the case i.e. it is not simply about awarding an amount for ‘survival’.

The decision also provides reassurance to charities whose claims under the Estate were relegated by the Court of Appeal on the basis that they had no expectation of a gift from the deceased.

Finally, and most importantly, the case re-iterates the importance of a will, being as it is a record of the deceased’s final wishes and that it will not be easily brushed aside.

Please contact our Tax, Trusts and Estate Team if you would like to discuss your will.

Author: Abha Pandya, Litigation Counsel – Litigation and Dispute Resolution Team

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