Family favourites

In recent years, the possibility of a successful claim under the Inheritance (Provision for Family and Dependants) Act 1975 (the 1975 Act) by adult children against the estates of elderly relatives (usually parents) appears to have increased. Elderly clients need to be advised of the implications that can arise, and the potential risk of litigation by dissatisfied children if the will unduly favours one particular child, or excludes an adult child.
Decisions by the Court of Appeal (CA) in cases such as Espinosa v Bourke [1999]1FLR 747; Re Hancock 1999 CA; and Myers v Myers 2004 EWHC 1944, appear to indicate a more liberal interpretation of the 1975 Act in respect of claims by adult children, even where the testator has given specific reasons why they wish to exclude the child. The ‘traditional’ view following the decision in Re Coventry (deceased) [1979]2 All ER, was that it was generally difficult for an adult child to make a successful claim unless there were special circumstances, or the testator had a specific moral obligation towards the claimant.
When making a decision, the court has to consider the factors set out in S(3) a-g of the 1975 Act. These include the financial resources and needs of any applicant or beneficiaries of the estate, the size and nature of the estate, the physical or mental disabilities of any applicant or beneficiary of the estate, and other matters (including the conduct of any person) the court considers relevant.
S1(1)(c) 1975 Act states that a child of the deceased is entitled to claim. There is no age limit and no requirement for the parents to be married, and it includes legitimated and adopted children. Stepchildren, if not formally adopted, will not be eligible under S1(1)(c) 1975 Act, but they may be eligible under S1(1)(d) 1975 Act.
In the case of Espinosa v Bourke 1999 1 FLR 747, the testator, aged 79, moved in to live with his daughter (Sandra) and his grandson, on the basis that Sandra would take care of them. Sandra gave up her part-time job and her father took responsibility for some of the financial liabilities, including the household bills, home improvements and paying the mortgage on the property.
Tensions arose because of the father’s disapproval of Sandra’s boyfriends. During the last year of the deceased’s life, Sandra spent much of her time in Spain with her Spanish boyfriend, who subsequently became her fifth husband. Sandra’s father made a will leaving his estate, including shares he had received from his wife, to his grandson. He stated in his will: “I have left no provision for my daughter Sandra Wilson because she has, during my lifetime, been adequately provided for. She has shown in my opinion a degree of irresponsibility.”
At first instance, Sandra’s claim for reasonable provision was dismissed, but this was overturned on appeal and she was awarded £60,000 from the total net estate of £196,000, despite the specific clause in her father’s will. Of significance to the CA was Sandra’s claim that her father had promised her mother that on his death, assets that she had left directly to her husband would pass to Sandra.
The conduct of the appellant (her neglect of her father) plus the wishes of the testator are factors that the court had to consider, but these were not enough to overturn “the weighty obligations arising from the promise.”
However, the CA also highlighted that the decision in Re Coventry did not state that in a claim by an adult child under category S1(d) of the 1975 Act, a “moral obligation” had to be established. “An adult child is, consequently, in no different position from any other applicant who has to prove his case. The court has to have regard to S3(1)(a)–( g) and assesses the relevance and the weight to be given to each factor in the list.”
The CA also drew attention to the importance of the financial provision of the parties: “The financial position of the applicant may determine the application. However rich the deceased, if the applicant has sufficient financial resources and no financial needs, it would not be necessary for the court to look further” (Butler Sloss LJ page 752). However, Sandra’s poor financial circumstances and her future lack of prospects because of age and lack of qualifications were important: “Certainly, the appellant’s present position does not in any way justify a conclusion that her earning capacity is such that she could only succeed in an application under this Act on the basis of moral obligation.”
Having decided the testator had failed to make reasonable financial provision for Sandra, the CA refused to make an order based upon either the mother’s estate or a nominal share of the father’s estate, but instead awarded a ‘reasonable’ sum, based on the future maintenance needs of Sandra, which was payable in the form of a lump sum of £60,000.
Since Espinosa v Bourke, there have been a number of other successful claims by adult children including the decision in Myers v Myers [2004] EWHC 1944, which concerned a claim by an adult daughter (B) against her father’s estate, on the grounds that her father (F) had not made adequate financial provision for her.
F left his entire estate to his widow and children from his second marriage, and had made no financial provision, either for his first wife or the children of that marriage, one of whom was B. B’s relationship with F had always been difficult, and after his remarriage they effectively became estranged. The correspondence in the case was extraordinary, with some of the letters that have been disclosed painting a vivid picture of a thoroughly disgruntled father estranged from his daughter.
The Judge applied the factors referred to in the 1975 Act S3(1), and stated that in reaching the decision to uphold B’s claim, he had considered B’s limited financial resources and her significant liabilities, including legal costs of nearly £60,000 and other unpaid debts amounting to £32,000. The Judge noted that F’s estate was large – over £8m – so it could meet the needs of all the parties including the second wife and children. B had suffered from long-term depression and had other health issues, which were also taken in to account by the court.
B might not have been a dutiful daughter and she had not seen her father for a period of 15 years between 1979 and 1994, but there was nothing to justify his repeated assertions that she had behaved disgracefully.
B’s failure to achieve more in her life was as a result, not of indolence as F saw it, but of B’s rather awkward personality and mental fragility. The court awarded a payment of £275,000 for the acquisition of a flat plus £20,000 for equipping the property, £21,500 to discharge outstanding debts, and a further figure of £200,000 to produce an income of £16,000 per annum – precisely what the testator had tried to avoid. Gold v Curtis [2005] WTLR 673 concerned Queenie Gold (T), whose homemade will left the residue of her estate to her daughter, Rosalind, the defendant (C), but made no provision for her son (G), the claimant. The will stated that G had “had enough from his parents during his lifetime” and also stated that he had been estranged from his mother in recent years. The net value of the deceased’s estate was £870,000. G had received very modest gifts from his parents in the seventies and eighties. C was unmarried with no dependants and had assets worth £1.1m.
At the date of the hearing, G was 58 years old. He and his wife had a joint net income of £37,500 and annual outgoings of £41,879. He was in poor health.
G had been estranged from T for many years, but had resumed some contact with T a few months before her death. G’s claim under the 1975 Act, S1(1)(c) was that he was unable to live at a reasonable standard without using his pension capital, and that he ultimately would have financial difficulty in his retirement.
The court upheld G’s claim. It was accepted that G had financial difficulties and took into account the fact that he had two adult daughters, one of whom suffered from a psychotic condition and was likely to be dependant on G for the rest of her life. By contrast, C was unmarried and had assets of over £1m. The Judge commented that the 1975 Act was not intended to be a “charter for spendthrifts and wastrels,” but that the court was not required to consider a lack of filial piety to be of great consideration.
G was awarded £250,000 from the estate, of which £220,000 was to augment his income, and £30,000 for capital items. He was still considerably less well off than his sister, but the court’s jurisdiction was to relieve his financial needs, not to achieve equality between children.
Not all claims by adult children in recent years have been successful, as was demonstrated in Garland v Morris [2007] EWHC 2 (CH). The claimant, Yvette, was an unmarried mother of three children living in poor circumstances and dependent on income support. The defendant Yvette’s sister, Beverley, was married with two adult children and had a joint income with her husband of £42,000 per year. Yvette and Beverly’s father (Mr Garland) had separated from his wife (W) in 1982, and the following year she had committed suicide. W had been concerned that Yvette had no house, whereas Beverly was married with a home, so W left Yvette her entire estate (£30,000), out of which she purchased a small house. Beverly’s exclusion from W’s will had led to ill feeling between the parties, and Yvette had not been in contact with either Beverly or T for many years prior to T’s death, whereas Beverly had remained in close contact with T.
T’s last will left a legacy of £5,000 to the two older children of Yvette (Yvette’s youngest child had not been born until after T’s death) and to each of Beverley’s children. The residue of the estate was left to Beverley.
Yvette obtained leave to bring an application out of time, some 30 months after the expiry of the normal six-month period, as she had been unaware of her right to make a claim until she consulted the Citizen’s Advice Bureau. By this time, Beverley had spent a significant part of the estate on purchasing a flat in London and on improving her own home.
The Judge refused Yvette’s application for further provision. In reaching his decision and applying S3 of the 1975 Act, he considered the following issues as significant:

(a)        Yvette’s poor housing was partly self-inflicted as she had declined a local authority loan, which would have enabled her to repair the property;
(b)        Yvette had received all of her mother’s estate some 15 years earlier;
(c)        Mr Garland’s estate was not particularly large (approximately £280,000);
(d)        Mr Garland’s relationship with Beverley and her children was close, whereas Yvette had never met or spoken to her father in the past 15 years of his life, and had made no real effort to do so;
(e)        Although Beverley’s financial position was better than Yvette’s, her pension provisions were poor.

The Judge also highlighted that the estate had already been distributed:
“Considerations such as these do not in my view affect the question of whether the disposition made by the will was reasonable, for the purposes of S1.But they may cause a court to make a less generous order than might otherwise have been the case had the application been made within time and the estate had not been distributed, or perhaps no order at all…”
The judge concluded that the lack of any provision for Yvette was not unreasonable. The refusal to make any financial provision for Yvette, notwithstanding the fact that she was living on income support and her youngest child was aged three, does appear to be harsh. If appealed, the outcome might have been different.
Some elderly clients may wish to exclude a particular adult child because of estrangement or the child’s ongoing behaviour – for example, drug addiction. The creation of a discretionary trust with a letter of wishes to the trustees may provide a flexible solution. However, the client should be advised of the tax implications and the ongoing running cost of the trust.

Practical implications

Warn the client (and confirm the advice in writing) that if they disinherit their adult children there is a risk that the estate could be involved in costly court proceedings;
A realistic pecuniary legacy to an adult child may minimise the risk of claim;
Define when and what information was provided, and the date and basis upon which the will has been drafted;
Discourage personal statements in the will as it is a public document, so mean-spirited and offensive allegations tend to be counterproductive. Letters or statements as to why the testator has chosen not to favour a particular child may be of help to the court. However, the court will reach its decision on the facts at the date of the hearing (1975 Act S3(5), so a letter or statement written ten years ago may not carry much weight and could even be counterproductive;
A letter of explanation to the child receiving less under the will may help the child to understand why the parent wishes to favour a vulnerable child at the expense of another child;
If the will is likely to cause conflict and the testator is elderly, consider whether medical evidence concerning capacity should be obtained as a precautionary measure.

A claim in respect of a will by an eligible applicant should not be regarded automatically as a failure by the solicitor who drafted the will, as the client’s assets and the parties’ circumstances may have changed unexpectedly prior to the date of the hearing.
In recent years, the scope for adult children making successful claims appears to have increased and, as a result, solicitors should advise clients wishing to exclude adult children accordingly. This area of law is unlikely to remain static.

Helen Clarke is a solicitor specialising in elderly client, mental capacity and probate issues. She lectures and delivers in- house training on a range of private client topics.