Feature

posted 14 Jun 2004 in Volume 9 Issue 4

ECA course: Part six
Protecting the interests of older people

In this part of the series, David Coldrick considers some of the main legal and practical considerations of relevance to drafting and interpreting wills containing flexible life interest trusts for older clients.

The flexible life interest will trust: From effective drafting to successful execution

Not all readers of this work are legally qualified and it is hoped that this section is reasonably accessible to them. Legally qualified readers will forgive the author running over some familiar ground as a result of the need to serve a wider readership.

Although ‘good’ and ‘quickly’ seldom go together, the author always finds it amazing what he has forgotten in twenty years of legal studies and professional practice. He suspects other professionals might also be pleased to quickly remind themselves of matters that either a dull lecture failed to instil or time has obliterated.

The context of this part of the series

It is assumed in this part that the stage has been reached where client instructions have been given and a will containing a flexible life interest trust is both required and desired. Readers who have followed the example given in preceding parts will know that the saga of the will for Mr Wise has reached this stage. That is much to the relief of his solicitor.

The detailed reasons for choosing the particular type of will examined here are not discussed further. Suffice it to say that such wills are broadly designed to secure the capital of the estate of the first to die for the next generation, while protecting the life tenant, the survivor, from reduction in their standard of living or hardship. The will trust arising on the first death should protect the estate of the first to die from the application of any care fees relating to the survivor.

It is emphasised that the will outlined is not being used to effect any inheritance-tax planning. It is inheritance-tax neutral.

Matters of will-drafting style

‘Proper words in proper places, make the true definition of a style,’ (Jonathan Swift). While there is no single ‘right’ way to draft a will, there are many wrong ways, each failing to achieve the desired result in its own distinctive way. Most solicitors do not adopt a particular will-drafting style. They apply formulas that they have become comfortable with. Comfort-zone drafting can sometimes be inaccurate and sloppy. Over-reliance upon a particular precedent makes it is easy to forget what words mean at law, what is necessary and what is superfluous. It may leave the client puzzled. ‘But our instructions were so simple…’ The will, like the last act of many operas, is often expressed in an incomprehensible foreign language as a result of which, the outcome remains slightly uncertain.

The client should hopefully understand the draft itself but, let us professionals be honest, often does not. The plain English campaign (www.plainenglish.co.uk) may have a point on this subject. However, the author does not agree that a will should contain an integral textbook glossary and detailed explanatory note. All clients are different and standardisation creates problems of its own. The author suggests a simple covering letter pitched according to the level of understanding and need may usually be preferable. An element of trust is inevitably needed. Do we need to understand how a car works to understand that something needs to be done by the mechanic to make it go properly?

The work of James Kessler QC is notable for its ruthless attention to legal detail, Palladian simplicity and rational uniformity. It is strongly commended to the reader. See Drafting Trusts and Will Trusts. A Modern Approach. The current 6th edition is published by Sweet and Maxwell. Readers of that work can expect to be challenged to reduce their drafting content to those parts actually required by the law of succession and trusts. Using a horticultural analogy, most will drafting has more in common with an English cottage garden than a formal country park: lots of colour and interest but the gardener is often unsure exactly how and why it is there.

A rather more traditional style with suitable and wide-ranging guidance notes relating to will trusts, including those with specific provisions restricted to the family home or a share in it, may be found in Butterworths Wills, Probate and Administration Service (Sweet and Maxwell).

The author’s poor but well-meaning draft, more legal Baroque than Palladian, is not as elegant as a Kessler draft but it has the merit, at least for the moment, of familiarity (hopefully not of the contemptible variety). The draft at the end of this article is of a will containing a typical ‘hybrid-style’ flexible life interest trust of the entire residuary estate.

Thinking through the provisions of the will

Innumerable checklists exist to help the draftsman take their instructions systematically. This section is not designed as such a checklist but to remind the reader of the possible options available once the details are drawn together and the basic form of will has been decided upon.

Statements of capacity

Contrary to popular belief, a will need not state that its author, the testator, has mental capacity to make it. If they did not have it then it would not be a valid will at least not without the express approval of the Court of Protection by way of a statutory will. It should also be noted that a statement asserting capacity cannot make a mentally incapable person capable, thus validating their ‘will’.

Revocation of earlier wills

There are a number of points about revocation to remember, which may be summarised as follows:

Clarity. To avoid confusion, a will should make it clear that it revokes all preceding wills. This is incorporated in the draft will for Mr Wise used in the example at the end of this article;
Foreign property. Care should also be taken to avoid accidentally revoking wills abroad dealing with foreign property. As more clients have foreign property, but English wills should not usually seek to deal with foreign land as a result of potential conflicts of laws situations, this is becoming more important;
Marriage and expectations of marriage. In some cases where clients are not married but expect to be married, then as the will would otherwise be revoked by that marriage at law, the will should be made specifically in contemplation of that particular marriage with a statement that the will shall not be revoked by it. Such a will is not revoked by that marriage as a result of Wills Act 1837 section 18(3) as amended. It is unwise to assume that older partners who appear to be married are actually married. Given that the spousal exemption to inheritance tax remains contingent upon this it is vital to ensure marital status is addressed. The simplest, most unobtrusive way to raise this is to ask for the date of the (assumed) marriage as part of a standard will-making questionnaire.

Bodily remains and funeral arrangements

Many older people have very clear views about their funeral arrangements. A will can request, but not require a certain form of funeral and disposal of the body. The author suggests that the executors and close family who are likely to make the arrangements should be informed well in advance of such wishes. That should preferably be in writing with a copy being lodged with the solicitor. This is a practical means of reducing the risk of argument after death. It may have more potent moral force than an unexpected statement in a will. The will may also be read by the family rather too late.

Clients may also wish to consider pre-paid funeral plans where they can dictate their wishes more thoroughly to the funeral directors. Some clients rather enjoy the process of making the arrangements. Such arrangements are contractual and hard to avoid. Furthermore, the beneficiaries are unlikely to want to make arrangements elsewhere, which would double up the cost.

‘Missing beneficiaries’ (deliberately)

It might be wise to extend the important introductory provisions of a will if there are specific concerns to be related to the executors and others who might refer to the will. It might, if an obvious potential beneficiary is missed out, for instance, declare it was made ‘after careful consideration of all my moral and financial obligations.’ It might even add ‘including to such and such because….’ The author has found that many older people have ‘moral’ points to make through the disposition of their estate and many are not unreasonable. They may for instance have been left isolated by certain family members and therefore wish to honour others or charities. They might not say that in so many words but can pass the honour elsewhere, for instance, ‘on account of our friendship’.

Clients sometimes wish to display a rather wicked sense of humour. The reason for an active omission may possibly best not be stated. Some clients advised the author that they wanted to state an omission “because she is an alcoholic”. Others indicated that their rationale was “because she is a Jehovah’s Witness”. And others advised it was “because he married that awful American woman”. The most bizarre involved a goldfish and is quite unrepeatable. The Lord Chamberlain’s ‘blue pencil’ may be used prior to publication of such a will after death in the guise of the probate registrar’s ability to censor such inappropriate comments. There are many ways of saying things and some other ways of having a certain effect without saying anything. Malicious comment is unacceptable in a professionally drafted will so, even though it may be strangely amusing, it should be missed out. A ‘letter of wishes’ privately explaining the reasons behind a particular issue to the executors and trustees may be an alternative, more appropriate course of action.

Choice of executors and trustees

It is often assumed that the role of executor cum trustee is simple and easy. As the previous part of this work indicated, this is frequently not the case.

The author’s opinion is that a will of any complexity and especially one with any form of continuing will trust should contain a mixture of professional and family trustees. If there is a serious risk of a dispute within a family then a full set of professional trustees may be preferable.

Fairness, especially where a will trust contains discretions, is a vital pre-requisite of appointment. Lack of inclination towards matters financial can be mitigated by use of solicitors in carrying out the administration. An unfair attitude is harder to remedy and it can create a more acute problem if there is a will trust with both present and future beneficiaries to consider. Willingness to act is also impossible to impose.

Consideration should be given to asking the testator to obtain the consent of the appointees and to pass on a note of advice upon the role of executors/trustees. This is possibly more important as a result of the application of the Trustee Act 2000 duty of care, which applies to non-professional executors and trustees as much as to professional ones, unless the testator specifically excludes the duty. The standard expected of professional ones is higher. It is submitted that given some greater awareness the role of the professional executor/trustee may be properly recognised. This should be good for the smooth administration of the estate and for business.

A grant of probate cannot be issued to more than four executors as a result of the Supreme Court Act 1981 Section 114(1). The author suggests that in cases where a will trust is being founded, three executors should be appointed. Two is probably sufficient. Three is primarily ‘just in case’. This is nothing to do with the commonly held belief that executors/trustees operate by majority vote. They do not. They must act unanimously unless otherwise stated.

Additionally, trustees must also act reasonably in the exercise of any discretions. It is also unwise to appoint the life tenant of the will trust as the sole executor and trustee. This would cause complication upon their death.

Gifts of personal possessions and other specific gifts

The intergenerational passage of certain personal possessions is often of considerable psychological importance to older people. With such items they are transmitting something intimate to themselves and their antecedents. It may, therefore, be appropriate to specify a gift of chattels either outright to the survivor or to others.

There are a number of issues to be considered:

Can the chattels be gifted under the will? It should be noted that just because personal possessions are still within the family home when the partner who is not in care dies, they do not necessarily form part of the deceased’s estate and thus, in the case we are examining, their will trust. Some chattels may be rented or on hire purchase and, therefore, cannot be disposed of by the will. Most chattels are likely to have been joint purchases, which pass automatically to the survivor in the care home quite outside the terms of the will. However, there will usually be some personal possessions that belong to one or other person. This is usually in the context of family heirlooms;
Lifetime gifting of chattels upon entry into permanent residential care. If the person entering residential care has the mental capacity to do so, they might execute a deed of gift of their entitlement to household personal possessions in favour of the person left at home. This can secure devolution away from them under the will of the partner left at home should that person then die. This may be particularly important if there are valuable chattels or more likely sentimentally valuable family heirlooms to be considered. In such cases, an otherwise rather tasteless technical act with its air of a final dismal separation from the family home becomes more palatable. Such a gift should not create issues of deprivation of capital/notional capital where the gift might be drawn back into the local authority means-testing assessment. A gift of a disregarded asset such as personal possessions should not be relevant. That is because, even if they had been retained by the person in care, the items given away would not amount to assessable capital. Logically, therefore, gifting them is of no relevance;
Chattels may be inconvenient. Chattels are often not very conveniently contained within will-trust arrangements. That is both as a matter of practical administration and as ‘wasting assets’, which are not naturally appropriate ‘investments’ for trustees to hold. Many modern will trusts do provide the trustees authority to retain and indeed buy chattels to secure the interests of the survivor but that is rather different from the trustees taking on the ownership of a household filled with possessions with an ongoing commitment to record, repair, replace, store and insure them, especially when that household is no more. Therefore, it is probably preferable for as few as possible to be contained within the will trust;
Gifts of chattels to those in care. An outright gift of personal possessions to the survivor may be pointless, especially if that survivor is in care. The care home may not have space. The alternative might be long-term storage but that is expensive and is of no obvious benefit to the survivor, especially if the survivor has to pay the storage and insurance charges out of their own limited resources. The lack of practical benefit to the beneficiary may also reduce the reasonableness of the trustees’ retention of them if they form part of a will-trust fund. On the positive side, personal possessions are not an assessable asset for the purposes of the local authority means test. However, if they have to be sold, the receipt of the proceeds will become additional assessable capital of the person in care. If they are sold while assets of the will trust, then the proceeds will become trust capital and disregarded assets for that reason;
Gifts of chattels to third parties. On balance, if the survivor is in care then it may be best to give the personal possessions to the children or other relatives. They can use appropriate ones for the benefit of the survivor, such as family photographs, and other small sentimental items. If an item has a particular relevance to a particular relative or friend then a specific gift might be appropriate. However, it is easy for wills to become too complicated and expensive. The solution of gifting all chattels to children or other relatives will usually only be acceptable if it is clear that the survivor will be in care. If it is not certain, then a gift to the survivor or into the will-trust arrangements may be the best course of action, even if not ideal. At least it secures the survivor’s interests in those items;
Ademption. Gifts of personal possessions or other specific gifts such as gifts of a house or certain shareholdings adeem (fail) if the item is not owned by the testator at death following Ashburner v Macguire (1786) 2 Bro. C.C.108. Those administering the affairs of an older person should be aware of this. Those administering the affairs of a person who becomes mentally incapable should try to ensure that gifts under their will are not adversely affected. A statutory will may be necessary in some circumstances to rectify an unavoidable disposal of an asset given under a will. To some extent, the risk may be alleviated in cases of lifetime disposals in relation to the affairs of mentally incapable ‘patients’ with ‘receivers’ appointed by the court of protection. Section 101 of the Mental Health Act 1983 may secure a replacement interest for a beneficiary otherwise affected by ademption. This provision does not apply to lawful gifts made under an enduring power of attorney.

Legacies

It can be easy to forget the common and desirable roles of legacies in recognising the relationships of the older person making a will. They can benefit family. It might be an additional gift to the family executor who would otherwise receive an equal share of the ultimate residue but for their extra ‘trouble’ in proving the will. Legacies can also benefit people who are not family members but who have been important to the testator. It may be the neighbour who has ‘looked out’ for the older person for many years. It could be the old friend with whom they have shared their reminiscences. It might be to create a purpose fund for the short-term upkeep of a family pet or something for the person who will look after that pet. It might also be a gift to the charity that the testator has always supported or to the local Church or ‘extra comforts’ fund of the care home or day centre. Such things are often of great personal importance to the companioned older testator.

There are some particularly important drafting points to note:

Legacies to executors. Legacies to those who also act as executors and trustees should always indicate as to whether or not they are contingent upon the recipient acting as a proving executor of the will. If they are ‘on account of their trouble’ and nothing else or ‘whether or not they prove my will’ then they should say so;
Legacies to carers. Gifts are frequently made to those who care for older people. If they are in the paid employment of the testator then the gift will be paid whether or not they are still employed at death. It is not presumed to be contingent upon employment. If the gift is to be contingent upon paid employment then that needs to be stated, perhaps together with provisions relating to payment in the event of retirement by the time of death, but not if notice has been received at the time. Readers will naturally be alert to possible issues of undue influence and duress inherent in the inclusion of gifts to carers;
Details. Care should be taken to secure the correct names and addresses of all beneficiaries and to make sure there is provision for any unexpected lapses of gifts, especially in the case of charities, which are nowadays more likely to change their name, form and constitution. Receipts provisions also need to be carefully considered both in terms of charitable gifts and for small legacies to minors;
When is the legacy to be paid? It is advisable to consider when the testator wants a gift to be paid. The basic options, in a situation such as that of Mr Wise in the example being followed, are that the gift is payable:

On the death of the first to die: “If my wife survives me I give…”;
On the death of the survivor: “If I survive my wife I give…”;
Upon whichever death in whatever order that occurs: “I give …”.

Gifts may be made contingent upon a person attaining a certain age. To avoid any possible doubt as to whether or not contingent (as opposed to outright) gifts to minors carry income or not, the author suggests that it may be simplest to state such gifts as follows: “I give £5,000 to Johnny Little at 25, which sum shall until that age be set aside and invested by my trustees under the powers of investment contained within this my will.”

However, if the gift is small, there are tax arguments to suggest that the gift should be made outright. In that situation, the rate applicable to trusts will not apply as it would in a situation involving a contingency, to create more onerous income and capital-gains-tax liabilities. Against the outright gift may be held the objection that it would be prone to pass as part of the minor’s estate if they die before attaining the contingency;
Provision for lapse or failure of a legacy. Consideration may be given to provide for the lapse or failure of a gift. In modest estates, it is suggested that over complication should be avoided to keep the cost of drafting within reasonable limits. Readers are reminded that some unexpected substitutionary gifts can arise under the Wills Act 1833 Section 33. Unless the will clearly rebuts it by providing substitution of its gifts to ‘children or remoter descendents’, then remoter issue will inherit in accordance with the terms of the Act. Many wills expressly exclude the application of this section as an inconvenience or out of fear of its sometimes fickle consequences. The author agrees that on balance it is best excluded to reduce uncertainty.

Is it necessary to mention the family residence by way of a specific gift upon certain terms or is it ‘safe’ to include it within the residuary provisions of the will?

It is possible to effect a life interest of the deceased’s share of the residence on its own. It is simplest in drafting terms, however, to secure the whole residuary estate for the survivor. It may also ensure that there is a fund available to meet the other needs of the survivor and, indeed, to provide for the expenses inherent in operating a will trust. This is particularly important where the survivor may be elderly and/or be in care with limited resources of their own and limited ability to deal with practical matters.

Where the residence was jointly owned under a tenancy in common, somebody who had contributed to its price formerly had an automatic right to occupy by virtue of their own share. See Williams and Glyn’s Bank Ltd v Boland [1981] AC 487. This is not now quite the case following the The Trusts of Land and Appointment of Trustees Act 1996. This is something that is frequently overlooked. For instance, Mr Justice Lightman criticised the parties for forgetting it in the High Court hearing of Eversden v Commissioner of the Inland Revenue 2002 STC 1109. But under Section 12(1) of that Act, a life interest in the residuary estate given to a surviving spouse is, in the author’s opinion, akin to a right of residence in any land contained within it. Section 12(1) states that: “A beneficiary who is entitled to an interest in possession in land subject to a trust of land is entitled by reason of his interest to occupy the land at any time if at that time:

The purposes of the trust include making the land available for his occupation;
The land is held by the trustees to be so available.”

An immediate right to income arising from the land held within the will trust in our example creates that tax law term of art an ‘interest in possession’. Our example also makes residential land available for occupation. That is both implicitly, because there is a family residence involved and because the will’s administrative provisions allow such occupation. Section 12(1) therefore appears to have the effect of a right of residence unless the land in trust is unsuitable or unavailable for occupation. The survivor should, therefore, not be too concerned about being ‘turfed out’ even if they do not own any share in the residence themselves and the residence is not specifically mentioned under the terms of the will. In the unlikely event of the beneficiary falling out with the trustees and the trustees trying to eliminate or limit that right of occupation by exercise of their powers of appointment, they would need to bear in mind the statutory context and exercise that power reasonably.

Residuary provisions of the will

The residuary provisions of the will used in the example are worded to ensure that the executors can pay relevant debts, wind up the estate and then effect the residuary flexible life interest will trust. There are a number of points to consider:

The example described. The straightforward example that has been worked through in the preceding parts of this work involves a flexible life interest trust of the residuary estate. The surviving spouse benefits from income for their life and then the capital of the trust fund, the residuary estate of the first to die, passes to the next generation ‘the remaindermen’. The surviving spouse may benefit from capital at the trustees’ discretion by way of a power to supplement income with capital and there is also a wide power to raise capital for the spouse or other named potential beneficiaries. This is all contained within the example will set out in this part. It should be noted that the power to raise capital for the spouse should not be framed as a power to supplement income with capital. Regular payments under such a power may create imputed income with adverse income-tax consequences for the recipient. This is particularly the case in situations involving a trust with an overall ‘income motive’ as opposed to a discretionary trust. See Stevenson v Wishart [1987] 2 All ER 428;
Residuary provisions where there are two distinct families to benefit. It is increasingly common to find that several families have been drawn together by way of re-marriage or co-habitation. In the case of a simple will leaving everything outright to the survivor and then to children it is not uncommon to find that a will fails to address the desire of both parties of the marriage to benefit separate parts of the family with ‘their’ money. In the simple case, one side may benefit to the exclusion of the other, depending upon the order of events. The more complex will may benefit the survivor for life and then each separate estate passes to the chosen beneficiaries. This reduces the risk of redirection of the estate of the first to die by the survivor who inherits outright. The risk can be practically excluded if the breadth of the overriding power of appointment contained within the residuary provisions is sufficiently limited and the trustees are sufficiently independent. Alternatively, both wills may benefit each side of the family upon the second death and after the expiry of the will trust. But the survivor may still change their will after the first death, thus diminishing the entitlement of the children of the first to die to a mere quarter of the total estates. Care should be taken to avoid perverse results;
Residuary provisions and the financial circumstances of recipients. It is advisable to ask the client whether or not the beneficiaries are in receipt of means-tested benefits. If they are in receipt of such benefits then consideration should be made to paying their share upon discretionary will trusts. Monies held on such trusts may be used for their benefit without being ‘available’ to them and assessable under the means-testing regulations. Many cases of lost benefits have occurred as a result of failure to consider this aspect. If the client does not have intimate details of the financial situation of the beneficiaries’ circumstances it is not usually appropriate to ask them direct without the express permission of the client. It is also advisable to check whether or not a beneficiary is in financial difficulties. If they are bankrupt or likely to become such, the use of a discretionary trust as the ultimate recipient of ‘their’ entitlement may also be desirable. Furthermore, if the beneficiary is relatively well off, the use of a discretionary trust as the ultimate receptacle after the death of the life tenant of the initial will trust may be advisable, as it avoids the new inheritance compounding an existing inheritance-tax problem;
There are different approaches as to whether or not the interests of the remaindermen should be contingent upon attaining a certain age or contingent upon surviving the life tenant:

Contingent upon attaining a certain age. In the author’s experience as house prices have risen substantially especially in the years 2000-2004 the previous propensity to adopt age 21 is seemingly being dislodged by age 25 (to the annoyance of some professional people under that age). Clients seem unwilling to entrust children or, more likely, grandchildren with large sums of money while only aged 21. This could de-motivate them in the quest for personal success or leave them vulnerable to their own whims and the predations of third parties. Except in very small estates or in the case of small legacies, the age of 18 is almost entirely dislodged;
Contingent upon surviving the life tenant. The ‘life tenant’ is, by way of reminder, the survivor with the right to income subject to exercise of the power to appoint capital away from them. Drafting the capital entitlement upon a contingent basis to such remaindermen as survive not only the testator but also the life tenant, allows the testator to effect substitutionary provisions for the final destination of capital, if a remainderman dies before the life tenant. This is the broad approach adopted in our example. It also adopts the usual approach of providing for the grandchildren in reserve should one of the children die. The potential disadvantage of this simple approach is that the recipient cannot assign their contingent interest away from themselves. They have no vested interest at all. That ability to assign a future interest in capital can be useful especially as such an interest is an excluded interest for their personal inheritance-tax purposes. If their entitlement to capital was stated as simply contingent upon the remainderman surviving the testator (while still contingent in effect upon the death of the life tenant) then as it was vested in the remainderman at the testator’s death it could be assigned;
Backstop provisions. Backstop or ‘just in case’ provisions are also submitted to be generally desirable in most will drafting. The example will goes straight from grandchildren to charities. Care should be taken not to overcomplicate wills however pessimistic the client or solicitor might be. It is worth mentioning that the rules against perpetuities and remoteness of vesting in income should be kept in mind by the draftsman. Those issues are left for the reader to consider by reading one of the textbooks recommended on will drafting generally.

Administrative provisions

The STEP Standard Provisions (1st edition) drafted by James Kessler QC is a very useful body of commonly required administrative provisions, which may be incorporated by reference. They are more than adequate to the task of a simple will containing a flexible life interest will trust. They contain, among other things, provisions covering the trustees’ ability to:

Invest (including without diversification);
Manage trust property;
Purchase joint property;
Purchase wasting assets;
Ignore the ordinary balance of investments between conflicting interests;
Apply accumulated income;
Allow beneficial use of trust property;
Apply trust capital to beneficiaries;
Trade;
Borrow;
Insure trust property;
Delegate their functions;
Deposit documents;
Appoint nominees;
Administer the trust abroad;
Pay relevant taxes;
Indemnify relevant persons;
Charge trust property;
Appropriate trust property to beneficiaries in lieu of an interest in the trust fund;
Obtain discharge by receipt from charities;
Release their powers;
Maintain or advance beneficiaries;
Accept disclaimers of beneficial interests;
Deal with conflicts situations;
Be remunerated;
Restrict their liability;
Appoint new trustees.

Attestation and other formalities

The author has decided to dwell a little upon this subject as it goes to the validity of the will itself and, as the long list of cases cited indicates, has been fertile ground for largely avoidable litigation.

Assuming a testator has sufficient mental capacity to make a valid will, the formalities of making a will must be effected correctly. Section 9 of the Wills Act 1837 as amended by Section 17 of the Administration of Justice Act 1982 states that:

“No will [or codicil] shall be valid unless:

(a) It is in writing, and signed by the testator, or by some other person in his presence and by his direction; and

(b) It appears that the testator intended by his signature to give effect to the will, and

(c) The signature is made or acknowledged by the testator in the presence of two or more witnesses present at the same time and

(d) Each witness either:

Attests and signs the will;
Acknowledges his signature in the presence of the testator (but not necessarily in the presence of any other witness), but no form of attestation shall be necessary.”

The section 9 requirements can be broken down for more detailed analysis and association with other relevant issues:

“…it appears that the testator intended by his signature to give effect to the will.” The will itself usually evidences the appearance that the signature was intended to give effect. That is a purpose of an attestation provision. However, outside/extrinsic evidence may prove this was the case in the event of doubt. The best course is to ensure there is no ambiguity on the face of the document to avoid unnecessary additional work for the solicitor or the probate registrar and a bigger bill for the beneficiaries to bear;
Unusual signatures. The older client may be more prone than others to physical disabilities, which might affect the signing process. Up to just seven years ago, when the author left mainstream general practice, he found that about one in a hundred wills involved illiterate clients. Some were even unable to sign their own name. Anecdotal evidence suggests this proportion is practically static. Fortunately, if the testator marks the will in some way intending that to be their signature then that is a valid signature as the Wills Act requires. This extension of what amounts to a signature includes: guided hand signatures Wilson v Beddard (1841) 12 Sim 28; thumb prints In the Estate of Finn (1935) 105 LJP 36; ‘a sort of broken line’ In the Estate of Holtam (1913) 108 LT 732; initials In the Goods of Savory (1851) 15 Jur 1042; and signature stamps In the Goods of Jenkins (1863) 3 Sw & Tr 93. Even unfinished signatures interrupted by death such as ‘E Chal’ have been admitted to probate In the Goods of Chalcraft [1948] P22;
Witnesses. The author suggests that this aspect of the formalities creates more confusion then any other. Witnesses do not need to know they are witnessing a will let alone know its contents. They just need to know the testator is writing not even that they are writing their signature. Witnesses must not leave before the testator finishes their intended signature (Re Colling [1972] 1 WLR 1440). Witnesses must be present in mind well as in body. They cannot be asleep, drunk or otherwise intoxicated or lacking mental capacity. They should also have legal capacity by being aged over 18. Blind persons cannot be witnesses as they cannot see the act of signing (In the Estate of Gibson [1949] P434). Beneficiaries or their spouses can act as witnesses so as to create a valid will, but the beneficiary will lose their entitlement to benefit under the will. Thus, beneficiaries and their spouses must not in practice act as witnesses;
Binding multiple pages. Wills may extend over several pages. Only one may contain the required signatures. So long as they are all in the same room at the time when the testator signs, even scattered about at random, the will is likely to be found valid following In the Goods of Tiernan [1942] IR 572. But it is best to ensure they are properly bound together. Sewing, stapling, plastic-heated binding, plastic spiral binding and other methods have all been popular at one time or another, but there is no prescribed form. But readers should beware of fastening anything to the will. That rusty old paperclip mark may lead to the need to effect an affidavit of ‘plight and condition’;
Attestation clauses. These clauses summarise the formalities of signing declaring they have been effected. Without one, the probate registrar will demand evidence of ‘due execution’. If the witnesses are dead or cannot be traced, the attestation clause adds helpful strength to the presumption of due execution. This is also why it is useful for witnesses to include their full name and address and occupation in capital letters.

Some examples of useful attestation clauses

A simple form of attestation is used in our example will. There are other simple forms and even in this one, the word ‘joint’ is more for comfort than legal necessity. The simple case following the worked example is:

Signed by the said Testator Solomon Wise in our joint presence as witnesses and then by us in his

If Mr Wise was blind the following could be used:

Signed by the said Testator Solomon Wise (after the will had been read over to him and he indicated his full understanding and approval of it) in our joint presence as witnesses and then by us in his

If Mr Wise was able to read his will but was unable to sign it the following could be used:

Signed by [name of person signing on behalf of Mr Wise] with the name of the Testator Solomon Wise (after the Testator had himself read it over and had indicated his full understanding and approval of it) by his direction in his presence and in our joint presence as witnesses and then by us in his

Signing procedure

It is best if the will is signed at the solicitor’s office to ensure that the formalities are effected properly. It should also be noted that executors and trustees who could benefit under the will in terms of charges, such as solicitors, accountants and financial advisers should not act as witnesses and nor should their business partners or spouses. This is probably in spite of the Trustee Act 2000 indicating that a charging provision is not to be treated as a legacy. The author has seen many overcomplicated signing procedure sheets sent to clients to secure the procedures are met properly. The procedure shown in the box below is submitted to be adequate and relatively simple.

There is a presumption of due execution but sometimes a witness may, for whatever reason, claim that they were not present. That is not always because the will was posted out with the arrangements being left to the testator. The case of Re Parsons, Borman and others v Lel and another [2002] WTLR involved a conveyancing secretary saying she had ‘witnessed’ the signature at her office desk and not by the testator’s hospital bed. In that case, extrinsic evidence proved to the satisfaction of the court that she had signed it on the ward. In the context of ordinary ‘at the office’ execution, barrister John Ross Martyn has said: “The possibility of doubt [in respect of ‘walk-in’ signings] will be reduced – indeed perhaps eliminated – if there is a standard form of instructions in reception, including an instruction that the testator read through the will, and the witnesses make a contemporary note that the instructions have been followed,” (Trusts and Estates Law Journal, April 2004) The author is in agreement with this. The guidance suggested above may be amended to this end.

Incidentally solicitors who cannot recall each of their will-making clients (perish the thought) may be comforted that, if an affidavit of due execution is required, the local probate registry may well agree that a will witnessed by a solicitor and A.N.Other (who cannot remember the circumstances either) was executed properly because they are aware of the rules. Sometimes it is useful to have that qualification.

Storage of wills

Some solicitors and professional will writers have failed to ensure that wills are stored in a safe place. Over the years there have been cases involving will destruction by way of fire, damp, flood, paper-eating insects, hungry goats, computer print falling off the page after a few years and other horrors. Practically everything apart from alien will abduction appears to have befallen wills in storage. It is also becoming apparent that some unregulated will writers (though by no means all) simply stored wills made for their clients in their front room. When they died or transferred their business the original wills are found to have disappeared and the client photocopy has had to be proved.

Failure to carefully consider use of appropriate paper, ink, binding materials and means of storage is to fail in one of the fundamentals of client care and usually loses the adviser the next potential set of clients in the shape of the original client’s children.

The author considers that it is advisable to store the client’s instructions and correspondence as well as the will. It is recommended that such papers be stored indefinitely at least until the estate is wound up but if there is a continuing will trust, consideration may be given to even longer storage.

A copy of the will might also be stored separately from the original will and will-file ‘just in case’.

Will trusts: A short summary for the guidance of possible trustees

There is a ‘will trust’. What does this mean?

‘A trust’ is a relationship that is recognised and enforceable in the courts so it is important you carefully consider whether or not you want to become a trustee.

The will which you are considering becoming a trustee of states that upon the death of the person making the will, certain assets are to be put under the control of the trustees. The trustees must look after the assets (the ‘trust fund’) for the benefit of ‘the beneficiaries’.

The trustees agree to act in the interests of the beneficiaries and not themselves, although sometimes they can be beneficiaries as well. This is why it is called a ‘trust’. They are entrusted to look after the trust fund for the beneficiaries. The beneficiaries can only benefit in the ways set out in the will.

What are the powers of the trustees?

The trustees have certain powers over the handling of the trust fund. These are set out in the will. In the present case, the ‘standard provisions’ of the Society of Trusts and Estates Practitioners are used. They are accepted by the courts for various purposes. Trustees do not have any power to go beyond the terms of the will and the standard provisions. Most things that a person would want to do with his own money can be done by the trustees for the benefit of the beneficiaries. For example, they can, upon taking appropriate advice, open and operate a trust bank account, invest money, retain, buy and insure property and purchase help and assistance for the beneficiaries.

What are the liabilities of trustees?

Trustees may sometimes need to take legal advice. That is funded by the trust fund and not from their own pockets unless the trustees do something wrong. This is called committing a ‘breach of trust’. Trustees are liable for losses due to ‘breach of trust’ out of their own pockets so taking legal advice is important. Trustees can also obtain help from accountants, for example, in filling in tax returns, and from other professionals as required. Again, that is at the expense of the trust fund so far as it is necessary to the smooth running of the trust.

What are the duties of the trustees?

Trustees must:

Disclose any circumstances where they might have a conflict of interest with a beneficiary. If a beneficiary owes a trustee money this should be disclosed;
Not act in conflict with the interests of the beneficiaries or profit from their role as trustee;
Ensure they know what the terms of the trust are and that they are carried out;
Ensure that they do not act beyond the terms of the trust and their powers given by it;
Ensure that good trust records and accounts are kept and that tax due is paid on time;
Take independent financial advice. This does not preclude the use of common sense. The trustees must also ensure that the advice taken is in accord with the Trustee Act 2000. The ultimate decision over what to invest in is the trustees’ decision. It cannot be delegated;
Act impartially and fairly between multiple beneficiaries and those who are beneficiaries now and those who will be in the future;
Take reasonable care. Professional trustees must take more care than others;
Act jointly. Trustees should not normally delegate functions to each other. Trustees are jointly liable for mistakes and should therefore act together;
Not charge fees. Only professional trustees can claim more than their out-of-pocket expenses;
Ensure the beneficiaries are kept fully informed. This avoids disputes.

Trustees are strongly advised to have at least one independent professional in their number. The appointment of family trustees is always open to the possibility of conflict. If in doubt on any issue call us.

The will-signing procedure for your will

Please:

Do not sign your will unless you are happy with its contents. You should read it first;
Do not make any changes to your will.

If you are not happy with the contents of your will please call me on the number below.

Witnesses:

You will need two witnesses to see you sign your signature on your will:

Witnesses must be aged over 18;
Witnesses must be mentally capable;
Witnesses must not be blind;
Witnesses must not be people who can benefit under your will;
Witnesses must not be people who are married to anyone who can benefit under your will.

Ideally a witness is a fully sighted person aged over 18 who is mentally capable, not a family member or a beneficiary under the will, or married to a beneficiary under the will.

Order of events:

All writing must be in pen and must not be in pencil or using some other material;
Date the will on the front and at the end (where marked) on the day you sign it;
You must gather the two witnesses into the room with you before you sign your will. None of you must leave the room until everyone has signed;
Then sign your will with your usual signature (where marked). Both witnesses must see you sign your will;
Once you have signed your will the witnesses should sign their usual signatures (where marked) and add their name and address and occupation in capital letters;
Only once you and both your witnesses have all signed the will should anyone leave the room.

And then:

Do not attach anything such as a staple or paperclip to the will;
Please return the signed will as soon as you can in the stamped addressed envelope supplied.

If in any doubt please call [name] on [telephone number].

An example of a flexible will trust of an entire residuary estate

The Last Will of Solomon Wise

I Solomon Wise of ‘Bookacre’ 7 Library Avenue Surbiton Surrey make this as my last Will by which I revoke all previous testamentary dispositions made by me

I appoint my children Pryce Wise of 11 Supermarket View Twistleton-Fiennes Kent and Una Wise of 13 (formerly number 14) Crumbling Cliffs Hove and my solicitor Sophia Minerva of Zeus & Co Solicitors Greek Street London to be my executors and trustees (‘my Trustees’);
I give all my personal chattels as defined by Section 55(1)(X) of the Administration of Estates Act 1925 to my said children jointly or to the survivor of them;
My Trustees shall pay my debts funeral and testamentary expenses and any inheritance tax due on such property as vests in them from the capital of my estate subject only to my Trustees administrative powers in respect of capital and income;
My Trustees shall stand possessed of the residue of the said monies in my estate and of the investments for the time being representing the same and of such part of my estate as shall for the time being remain unsold and unconverted (all of which property is hereinafter referred to as “my Residuary Estate”) upon the following trusts:

4.1 To pay the income from my Residuary Estate (subject only to the possible exercise by my Trustees of the overriding power of appointment below) to my widow Sagacity Wise for her life PROVIDED THAT she shall survive me by thirty days and without her becoming entitled to that income during that period except in that event;

4.2 DURING the Trust Period (being for the purposes of this clause of this my Will the period ending on the earlier of the last day of the period of eighty years less one day from the date of my death which period and no other shall be the applicable perpetuity period and such date as my Trustees shall by deed at any time or times specify not being a date earlier than the date of execution of any such deed or later than a date previously specified) my Trustees (being at least two in number or a trust corporation) may at any time or times:

4.2.1 By deed revocable or irrevocable appoint that all or any part of or parts of my Residuary Estate shall be held on such trusts (which may include discretionary or protective powers or trusts) - but without infringing the rule against perpetuities and excessive accumulations of income - in favour or for the benefit of all or any one or more of my said widow and my said children and any remoter issue of mine through my said children but in each case who are alive at the start of or born during the Trust Period but not otherwise and such charity or charities as my Trustees may in their discretion decide to appoint AND any such appointment may include such powers and provisions (including dispositive and administrative ones exercisable by my Trustees or any other person) and such other provisions as my Trustees in their discretion think fit WHILST no exercise of the power contained within this clause of this my Will shall invalidate any prior payment or application of all or any part of the capital or income of my Residuary Estate made under the trusts of this my Will or made under this or any other power conferred by this my Will or by law

4.2.2 Furthermore:

4.2.2.1 Any trusts and powers created by an appointment under this clause of this my Will may be delegated to any extent to any person whether or not including my Trustees or any of them

4.2.2.2 Such appointment may include the transfer of all or any part or parts of the capital of my Residuary Estate to the trustees of any settlement wherever established (whose receipt shall be a good discharge to them) to be held free from the trusts of this my Will and on the trusts and with and subject to the powers and provisions of that settlement but only if those trusts powers and provisions are such that they could themselves have been created under this clause of this my Will as above and;

4.2.2.3 My Trustees may raise any sum or sums out of the capital of my Residuary Estate and pay the same to my said widow for her absolute benefit without her having to witness any such advance by deed

4.2.3 SUBJECT to the preceding provisions of this clause of this my Will and to the exercise of the powers thereby given my Residuary Estate shall be held as to both capital and income UPON TRUST for such of my said children as survive me by thirty days and if both do so in equal shares absolutely PROVIDED THAT if either such child of mine dies before me (or before attaining an absolute vested interest in capital in my Residuary Estate) but leaves a child or children alive at the death of the survivor of my child and me who reach 21 years before the end of the Trust Period or are under that age and living at the end of the Trust Period then such grandchild or grandchildren of mine shall take absolutely and if more than one does so in equal shares so much of my Residuary Estate as that child of mine would have taken on attaining an absolute vested interest in the capital therein FURTHER PROVIDED ALWAYS that if no person attains an absolute vested interest in the capital of my Residuary Estate then my Residuary Estate shall be paid to such charity or charities (and if more than one is chosen in such shares as they think fit) as my Trustees shall in their absolute discretion decide

5. The Standard Provisions of the Society of Trust and Estate Practitioners (1st Edition) shall apply with the exception of paragraph 5 Section 11 of the Trusts of Land and Appointment of Trustees Act 1996 which shall not apply

As Witness my hand this [date] of [month] 200[year]

Signed by the said Testator Solomon Wise
in our joint presence as witnesses and
then by us in his

David Coldrick is partner in charge of Wrigleys Solicitors Sheffield office and welcomes comments and queries. He can be contacted at: david.coldrick@wrigleys.co.uk A primary edit by Lynne Bradey and Julia Boler (solicitors) in finalising this section for publication is gratefully acknowledged.