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The Inheritance Act and Testamentary Freedom: forced heirship through the back door?

 Anna Neil considers claims under the Inheritance Act and whether Testamentary freedom is a thing of the past.

 

Testamentary freedom is long recognised as a feature of English law, in contrast with many other jurisdictions where testamentary freedom is limited by statutory rules of forced heirship or similar.

It is commonly taken for granted that a testator who has the mental capacity to do so can make a will leaving his estate to whomever, however he wishes.  Whilst most testators carefully weigh up their obligations towards their family and dependants, most also assume that ultimately the decision is theirs.   Is this a misconception?

In 1975 the Inheritance (Provision for Family and Dependants) Act came in to force, consolidating family law provisions which gave some protection for the needy but excluded beneficiary.   It sought to strike a balance between testamentary freedom and what might be seen as a moral obligation on behalf of the testator to support those he knew to be reliant upon him.    Yet, morality is not mentioned in the act, only ‘obligation’ – “any obligations and responsibilities which the deceased had towards any applicant for an order…..”  

Until recent years it could be argued that the Inheritance Act and testamentary freedom co-existed, sitting side by side - the Inheritance Act arising where the testator strayed too far from his obligations.  It is an important and difficult balance to strike.   However, claims under the Inheritance Act are on the rise. This is in part due to increasingly complex family arrangements but in part due to application of the Act. The weight attributed to testamentary freedom is decreasing and claimants previously thought unlikely to succeed, have been succeeding.

The Inheritance act gives particular categories of claimant the right to bring a claim against an estate where the will does not provide for them at all or where it does not make reasonable provision. The potential categories of Claimant are limited but include spouses (and estranged spouses), former spouses, cohabitees (a later addition), children (including adult children and step children) and anyone who can show that they were being maintained by the testator at the time of their death. 

The claim is for “reasonable financial provision”.  What constitutes reasonable provision depends on the circumstances of each case – and whether the claimant is a spouse (entitled to more generous provision) or another claimant.  The Act provides criteria that the court must apply and these include the needs of the claimant, the size of the estate, the needs of the actual beneficiaries of the will or any other possible claimant, the testator’s obligations and ‘any other matters’.  It is under this last heading that the court can consider the testator’s wishes and make an objective decision on how reasonable these are.  It is under this criteria that ‘morality’ can come in to play.    These factors are a balancing act and often conflict with each other. 

A key case is the 2017 well publicised decision in Ilott v Blue Cross.  This was the first case under the Inheritance Act to reach the House of Lords.  Here an estranged adult daughter bought a successful claim for provision against her mother’s estate.  The deceased left everything to charity with a note explaining why she had cut her daughter out of her will.  The ultimate reward was relatively small - an acknowledgement of the testators wishes. There was much dicta within the judgements about testamentary freedom.  However, it also set a clear precedent for successful claims from those with no demonstrable reliance upon the deceased.  It had previously been considered that estranged adult, financially independent children would be unlikely to succeed in establishing that ‘reasonable financial would be anything other than nothing.   The claimant in this case was able to show that her finances were extremely tight – but she had nevertheless been living within her means.  Since this case (and with some exception) the trend has been to pay less and less attention to the testator’s wishes.

In Nahajec v Fowle, another estranged child (here one of 3 estranged children) succeeded in claiming around 11% of the estate all of which was left to the testator’s friend.  Again there was a clear letter from the testator expressing his wishes.  Here the claimant was able to demonstrate financial need in so far as her finances were in a very poor condition with debts she struggled to service, but she had not been receiving any assistance from the testator prior to his death.   Very little weight was given to the testator’s wishes. 

The recent 2020 case of re H also involved an estranged adult child.  In this case, the Deceased (who died unexpectedly) left a Will gifting his entire estate to his widow, who was also mother of the estranged daughter.  What was wrong with this you might think? 

The widow was 83 and living in residential care for which she required finance.  The only other child of the marriage, was the son executor of the estate.  The Claimant had not been receiving any financial support from the testator but she was able to establish financial need.  She produced evidence of a limited earning capacity, financial difficulty and reliance upon benefits.  The estate was valued at trial at around £550,000.   The judge allowed the claim, accepting that reasonable financial provision had not been made for the claimant who was awarded £140,000.  Whilst the surviving spouse also had needs, it was decided hers could be met from her share of jointly held assets.   Little or no regard was had in this case for the testator’s wishes.   

 

Whilst the case of re H was unusual on its facts (it was not properly defended), it follows a line of successful claims under the Inheritance Act involving adult children, cohabitees and estranged spouses.  Overall, increasingly little weight is placed upon the testator’s wishes.  It seems as though if a claimant can establish a right to bring a claim and personal financial hardship, they may very well succeed if they have not been provided for – regardless of the testator’s wishes.  How different is this to forced heirship rules of other countries where a testator must leave a certain percentage of his or her estate to the spouse or children? 

For advice on how best to avoid such claims arising when making your will or if you have concerns about a will please contact Anna Neil for a free initial consultation.