In a long-awaited judgment, the Supreme Court in has overturned part of a Court of Appeal decision which supported a woman excluded from her late mother’s will and ruled instead in favour of the charities who had been left the entire estate.

The decision provides some welcome guidance about the interpretation of the Inheritance (Provision for Family and Dependents) Act 1975. The judges concerned were quick to point out that this area of law has been in an unsatisfactory state for a long time. Their reasoning sheds some light on method of assessment of Inheritance Act claims by courts. However, further questions will doubtless be raised before the courts in the future.

The decision should, however, be considered on its facts along with every future case.

This article explains why.

Facts of the case

Heather Ilott was excluded from her late mother’s will, which left most of her estate, worth around £500,000, to three animal charities. Mrs Ilott was estranged from her late mother, having left home at 17, and they had not spoken for most of the 26 years before she died. Mrs Ilott’s family received state benefits and had a net annual income of £20,000.

Initially Mrs Ilott, who is now in her 50s, was awarded £50,000 by a district judge in the High Court after she challenged the will. The judge found that a letter left by Mrs Ilott’s late mother, explaining why she chose to disinherit her daughter, was not wholly founded on truth.

Mrs Ilott and the charities appealed. Mrs Ilott said she was not awarded enough, whereas the charities claimed that there was no lack of reasonable financial provision. The charities’ appeal failed. Mrs Ilott’s appeal was considered by the Court of Appeal.

The Court of Appeal said the district judge had placed too much emphasis on the period of estrangement and a lack of expectation of benefit on the part of Mrs llott. The Court of Appeal said the charities had no expectation to receive any money either, and found that Mrs Ilott’s mother had acted in an unreasonable and harsh way by disinheriting her daughter. The Court of Appeal therefore awarded Mrs Ilott £143,000 so she could buy her property, and also provided her with the option to receive £20,000 in one or more instalments. They structured this award so as not to affect Mrs Ilott’s entitlement to state benefits. The charities appealed this decision.

The Supreme Court’s decision

All judges found in favour of the charities and allowed their appeal. The initial decision by the district judge was restored, meaning Mrs Ilott received £50,000.

Many commentators at the time of the Court of Appeal’s decision thought the decision made it easier for adult claimants to be successful in Inheritance Act matters. Many are now asking whether the Supreme Court has made it more difficult for adult claimants.

The legal position

A claimant who is related other than as a spouse or a partner is limited to financial provision which is reasonable for his or her maintenance only.

The key factors which a court must use to decide on claims of this nature can be found within s3 of the Inheritance Act. This was the case before the Supreme Court’s ruling and remains the same following the decision.

The factors include:

• the applicant’s current or likely future financial resources and needs or those of any other applicant or beneficiary of the estate;
• the obligations and responsibilities which the deceased had towards the applicant or any beneficiary of the estate;
• the size and nature of the net estate of the deceased;
• any physical or mental disability of any applicant or any beneficiary of the estate; and
• any other matter which in the circumstances of the case the court may consider relevant.

The last point clearly creates wide scope for the specific facts of an individual case to be taken into account when a court determines a) whether to make an award, and b) if so, how much to award.

The Supreme Court has reiterated that a court must consider all of the above factors so far as they are relevant, and in light of those factors a single assessment of reasonable financial provision should be made. The district judge was therefore perfectly entitled to take into account the estrangement between Mrs Ilott and her late mother.

The Supreme Court also disagreed with the Court of Appeal’s reasoning that the charities had no expectation to receive under the will and said that a beneficiary – whether a relative or a charity – does not need to justify their claim by reference to expectation or to need.

What next for adults with Inheritance Act claims?

It is important to note that, although clearly welcomed by charities nationwide, this decision does not signal an end or a restriction to this type of Inheritance Act claim.

It was never up for debate before the Supreme Court decision whether Mrs Ilott was entitled to anything at all from her late mother’s estate – it was simply a question of ‘how much’.

As to this question, the facts of Ilott v Mitson, although not uncommon, are relatively case-specific, and the Supreme Court has made it plain that each case will turn on its own facts.

The judges said: “The level at which maintenance may be provided for is clearly flexible and falls to be assessed on the facts of each case”. It remains that a lump sum, as well as periodical payments and provision of housing, all potentially count as maintenance. Again, it depends on the facts!

Essentially, the Supreme Court’s judgment means that Inheritance Act claims will continue to be a value judgment by the court.

JMW’s probate litigation team regularly advise on successful Inheritance Act claims by adult claimants, including adult children, who are seeking to challenge the will of a deceased parent or other family member. Nothing much has changed as a result of this decision; however, the highest court in the country has attempted to shed some much-needed light on the legal approach required to assess Inheritance Act claims.

This most recent legal development does not create any hindrance to such claims, although it does mean, as previously, that each case will have to be carefully examined and argued on its own individual facts.

Ilott (Respondent) v The Blue Cross and others (Appellants) 2017 [UKSC] 17 http://www.bailii.org/uk/cases/UKSC/2017/17.html