The Inheritance Act 1975: Hannah Mantle and Maryam Oghanna write for ThoughtLeaders4 Private Client

Contentious Trusts and Estates Senior Associates, Hannah Mantle and Maryam Oghanna, write for ThoughtLeaders4 Private Client on the key Inheritance Act 1975 cases from the last year.

The article, entitled 'Inheritance (Provision for Family and Dependents) Act 1975: Round Up' was first published in the Thought Leaders 4 Private Client magazine and can be read in full below.

As we are all too aware, claims under the Inheritance (Provision for Family and Dependants) Act 1975 (the “Act”) are notoriously discretionary and fact specific. For that reason, many of the claims that reach the Courts (rather than settling) include a novel point, or clarify points which are too often disproportionate to argue; so it can be useful to have a look at the year’s cases in summary.

Unusual claims

Some of the sections of the Act which are less commonly used are sections 9, 10 and 11, namely to enable joint property to be treated as forming part of the estate, to defeat dispositions which were intended to defeat applications under the Act, and to defeat a contract made by the deceased to leave certain property under his will.

Section 9 was considered by the High Court in Beg v Beg [2021] EWHC 2598 Ch. Under the terms of her late husband’s will, Mrs Beg was the principal beneficiary of his estate. However, the matrimonial home had been owned in the joint names of the deceased and his brother. Firstly, the Court had to determine whether the property was owned by the brothers as joint tenants or tenants in common – the surviving brother successfully argued that the property was owned as joint tenants and passed to him by survivorship. However, Mrs Beg had also claimed under the Act (including s9) and was partially successful in arguing that the deceased’s half share of the property should be treated as part of the estate for the purposes of her claim for financial provision. The sum of £80,000 was treated as part of the estate, which was not the full value of the deceased’s half share, but was sufficient to allow Mrs Beg to repay the mortgage on another property in the estate, thereby giving her a different home to live in which provided reasonable financial provision.

Section 11 was also considered last year, for the first time, in the case of Sismey v Salandron [2021] 10 WLUK 372. The claim was brought by the son of the deceased from his third marriage. During the deceased’s divorce from the claimant’s mother, he had agreed by a deed (the terms of which were enshrined in a consent order) to leave his English home to their son. He later married his fourth wife, with whom he also had a child. She was widowed shortly after their marriage, and the estate passed under the intestacy rules. The Court found that the agreement was valid and enforceable (as it complied with the Law of Property (Miscellaneous Provisions) Act 1989 s2), and so went on to consider whether it could effectively be set aside by s11 of the Act. It found that, whilst the agreement was a contract entered into with the intention of defeating a claim (amongst other factors), the condition in s.11(2)(c) was not met as full consideration had been given by his ex-wife, by giving up claims to alternative assets including her share of the property and the deceased’s pension (from which the widow was now due to benefit). The son from the earlier marriage therefore inherited the property, as provided for by the deceased prior to his remarriage.

Minor and vulnerable children

Various reported cases last year considered the position of minor or vulnerable children of the deceased. For example, Re R (Deceased) [2021] EWHC 936 (Ch), where a father had died, leaving his estate to his parents and his new partner, to the exclusion of his two sons. The deceased and the sons’ mother had divorced six years previously, and the deceased had only maintained a very limited relationship with his sons for a short time. The mother and her subsequent husband had borne the costs of raising and educating the claimants privately, as the deceased had paid no maintenance or child support. The Court found that it would be highly unusual for a parent/ minor child relationship to breakdown so significantly that it would be reasonable to make no financial provision, even if someone else had taken on financial responsibility for them. Conversely, it found that the sons (or their mother) could not expect all of their costs to be met from the estate following their father’s death, as a sort of balancing exercise. The Court made an award based on the estate meeting between 50% and 100% of various itemised expenses for each of the sons from the date of death, until a year after they finished university, including accommodation, private school fees, cars, and counselling.

A slightly earlier case where the claimant reached majority after issuing his original claim was Wickham v Riley [2020] EWHC 3711 (Fam). The claimant had originally made a claim under the Act in 2017, after his father died in 2014. He had acted by his litigation friend until he reached adulthood in 2018 and subsequently discontinued the proceedings in 2019. The matter returned to Court in 2020, to address whether the discontinuance had been valid (including whether the claimant had litigation capacity at the time) and request permission under CPR r38.7 to make a new claim. The Court considered the evidence of the claimant’s diagnosis of autism spectrum disorder and expert evidence on his capacity. The Court concluded that, whilst vulnerable, the claimant was and remained capacitous, and (having opened the judgment with a quote from Bleak House) granted permission for him to issue a new claim under the Act.

Adult children and step-children

There were, of course, cases this year which confirmed the view that adult child (or step-child) cases often require an additional element in order to succeed (e.g. Re Mohammed (Deceased) [2021] EWHC 2532 (Ch) where the claimant could not show a maintenance need, or Miles v Shearer [2021] EWHC 1000 (Ch) where the claimants could not show needs for maintenance and had also been told by the deceased not to expect any further provision from him). Nevertheless, there were others where adult children or step-children were noticeably successful.

The Court of Appeal case of Hirachand v Hirachand [2021] EWCA Civ 1498 has been much commented in relation to the decision regarding the cost uplift under a conditional fee agreement, so I do not propose to do so again here. A point which has perhaps been discussed less is the other ground for appeal, namely that the video-link trial did not provide sufficient access to the defendant widow, who was elderly, deaf and living in a care home. The defendant had been debarred from participating in the proceedings, after twice failing to file an acknowledgement of service or evidence, despite having obtained legal advice. She attended the remote hearing following assistance from the claimant’s solicitors and had been provided with all relevant material. The Court of Appeal dismissed the appeal and found that there is no obligation on a court to proactively manage the attendance of a debarred party.

Another case dealing with CFAs and adult claimants was Higgins v Morgan [2021] EWHC 2846 (Ch). In this case, the claimant step-son of the deceased who had died intestate was awarded £55,000, including a contribution of £15,000 towards his CFA success fee (or a total of about 25% of the estate) after successfully making out a need for maintenance. The Court also found it relevant that the deceased had had a close relationship with the claimant and had made various assurances to the claimant about provisions that would be made for him in future. A contribution towards the uplift for the success fee was granted on the basis that it is a factor when considering the claimant’s needs for the purpose of the Act.

Watch this space

When the Law Commission considered the future of the Act in order to develop the Inheritance and Trustee Powers Act 2014 (the “2014 Act”), it considered whether the Act should be broadened to include deceaseds who were not domiciled in England and Wales (whether generally, or, for example, those who had real property here). As the 2014 Act did not, in the end, include any provision for claims on the estates of people not domiciled in this jurisdiction, a gap potentially arises in the law in providing for people who live or have assets here, but do not intend to remain here permanently. This may have contributed to the interesting outcome in the divorce of Hasan v Ul-Hasan [2021] EWHC 1791 (Fam), where the claimant’s matrimonial financial remedy proceedings were (understandably) found to be incapable of continuing following the death of her late husband. If the proposals prior to the 2014 Act had been incorporated into the Act, it is quite possible the Mrs Hasan would have been able to bring a claim under the Act. Instead, the case is being leapfrogged to the Supreme Court to decide whether she can continue her financial remedy proceedings on divorce. It will be interesting to watch the outcome and whether it affects any potential claimants under the Act.