Your eye may have been caught by headlines reporting that a disinherited daughter recently succeeded in a claim for a substantial share of her mother’s estate. Partly this is because the facts could be taken from an episode of a soap opera but also because it has widely been reported that the case drives a coach and horses through an individual’s right to leave their estate to whomever they chose. But is this actually the case?
In our article of 29 July 2015, we considered what the Court of Appeal decision in Ilott v Mitson  EWCA Civ 797 means for testators who wish to make little or no provision for their children in their wills. In this article, we look at the case from the perspective of a disinherited adult child wishing to make a claim against the estate of their late parent.
The Claimant, Heather Ilott, brought a claim under the Inheritance (Provision for Family and Dependents) Act 1975 (“the Act”). This Act enables certain categories of person to make a claim against a deceased’s estate on the basis that the deceased’s will or the intestacy rules make no reasonable financial provision for them. One such category is children of the deceased.
It is easy to see why this is the case where children of the deceased are under the age of 18 and are financially dependent on their parents. However, historically it has been difficult for an able and financially independent adult child to make a successful claim under the Act. It has been widely reported that this case is therefore something of a gamechanger, enabling disinherited adult children to claim great chunks of their estranged parent’s estate, but is that really the case?
To be successful, the adult child claimant has to show that the will or intestacy rules fail to make “such financial provision as it would be reasonable in all the circumstances of the case for the applicant to receive for his maintenance”. “Maintenance” means payments which, directly or indirectly, enable the applicant in the future to discharge the costs of his daily living at whatever standard of living is appropriate to him – in other words, provision to meet recurring daily living expenses. The Act is not designed to hand out windfalls. Nor does it confer any entitlement to a payment just because the claimant is the child of the deceased. The obligation is on the adult child claimant to show that they are entitled to receive reasonable financial provision from the estate for their maintenance.
Every case depends on its own facts but for most adult children who are in employment and who are financially independent, this is likely to be a tough case to make out. In considering a claim, the Act obliges the Court to consider a number of factors which include:
- The financial resources and financial needs that the applicant has or is likely to have in the foreseeable future;
- The financial resources and financial needs that any other competing applicant has or is likely to have in the foreseeable future;
- The financial resources and financial needs of any beneficiary has or is likely to have in the foreseeable future;
- Any obligation that the deceased had towards the applicant or any beneficiary;
- The size and nature of the net estate of the deceased;
- Any physical or mental disability of the applicant or any beneficiary; and
- Any other matter including the conduct of the applicant and any other person which the Court considers relevant.
The Court is also obliged to have regard to the earning capacity and the financial obligations and responsibilities of both applicant and beneficiaries.
So, how did these factors play out in this case and lead to Heather Ilott being awarded £143,000 out of her estranged mother’s estate, valued at £486,000?
- Heather and Nicholas have a very small joint income and rely on state benefits. They have 5 children. They live in a housing association property that they have the right to buy but not the funds to enable them to do so. They have no pension for their retirement and have made no provision to deal with any eventuality such as ill health. Their income is so small that they have never had a holiday, struggle to buy clothes for their children and have to limit the food that they buy. The Court of Appeal found that their income was not therefore sufficient for their maintenance. The fact that their resources were at such a basic level outweighed the weight that the Court would usually attach to a claim by an adult child who had been living independently for many years.
- The deceased had left her estate to three animal charities with whom she had had no connection during her lifetime. It was not a case where monies had instead been left to family members or friends. The gift to the charities was a windfall and they could not demonstrate any competing need to monies from the estate.
- Heather was an only child. There were no other competing family members, either as beneficiaries under the will or as other applicants under the Act.
- The deceased had born no responsibility for her daughter since she left home at the age of 17. Mother and daughter had been estranged for 26 years. The deceased was found by the Court to have acted in “an unreasonable, capricious and harsh way” towards her daughter. That said, the Court also concluded that both mother and daughter that were responsible for the fact that they failed to reconcile. It considered that the fact of their estrangement ought not to deprive Heather of an award or substantially diminish it where it was difficult to apportion fault.
- The Court can only make an award for maintenance – this means meeting Heather’s living needs, not improving her standard of living. Maintenance means more than merely getting by on an extremely tight budget. The Court therefore ordered that Heather be paid a lump sum from her mother’s estate to enable her to buy the housing association property in which she has lived for many years, which would provide some financial security and an asset against which funds could in future be raised in old age, together with funds to enable her to meet the costs of purchase. She was also given the option to take a further £20,000 from the estate to overcome concerns about how an award would affect her state benefits.
Would the award to Heather have been different if she had a good income? Probably. Would it have been different if her mother had continually offered the proverbial olive branch and she had shunned this in favour of continuing to cut her mother out of her life? Maybe. Would the outcome have been different if the estate had been left to other relatives or friends with whom the deceased was close to during her lifetime? Possibly.
Despite the headlines, this case has not therefore flung open the floodgates to claims from disinherited adult children seeking large sums of money from their estranged parent’s estate. What it has done is underlined that claims under the Act are very fact dependent. What the Court has to do is apply the criteria set out in the Act to the facts of each case and then exercise its discretion whether to make an award and if so in what amount.
A final word of warning – claims under the Act must be commenced within 6 months of the date of the grant of probate. If you think you may have grounds to bring such a claim against your parent’s estate, do not delay in seeking legal advice. Each claim will depend on its own facts and specialist advice should be sought without delay to understand the prospect of your claim succeeding.