The Supreme Court has handed down its much anticipated decision in the case of Ilott v Mitson, in which it found in favour of the appellant charities.
The applicant in this matter, Mrs Ilott, was the estranged daughter of the deceased, Mrs Jackson. Mrs Ilott left home at the age of 17 to live with Nicholas Illot, whom the deceased disapproved of. The couple later married and had five children. They rent their property from a housing association and are in receipt of state benefits.
The applicant and the deceased made several attempts to reconcile their relationship which broke down when Mrs Ilott left home. All of these attempts failed and the mother and daughter remained estranged at the time of the deceased’s death.
Mrs Jackson died in April 2002, leaving a will that made no provision for the applicant or her family. The will left her entire estate to three charities (with the exception of a legacy of £5,000 in favour of the BBC Benevolent Fund) namely The Blue Cross Animal Welfare Charity, Royal Society for the Protection of Birds and Royal Society for the Prevention of Cruelty to Animals (the “Charities”). The value of the estate is c.£486,000.
Mrs Ilott brought a claim pursuant to the Inheritance (Provision for Family and Dependants) Act 1975 (the “1975 Act”) on the basis that she believed the estate failed to make reasonable financial provision for her and was awarded £50,000 at first instance. On appeal to the Court of Appeal this award was increased to £163,000
The 7 justices of the Supreme Court unanimously allowed the appeal of the Charities against the decision of the Court of Appeal and restored the first instance decision awarding £50,000 to the Claimant. In its judgment the Supreme Court highlighted the following:
- The significance of testamentary freedom. Appropriate weight should be attached to the testator’s wishes.
- The long term estrangement of Mrs Illot and the deceased was a relevant factor and indeed might have resulted in a legitimate conclusion of a judge at first instance that the claim should fail in its entirety.
- Reasonable financial provision can include the provision of housing, but ordinarily by creating a life interest rather than awarding a capital and inheritable sum, thereby not depriving the intended beneficiary of the capital asset once the life interest has ceased..
- State benefits are to be treated as a resource of any claimant and the court must consider whether they will continue to be received.
- The matters to which the court must have regard in these cases are detailed at section 3 of the 1975 Act. All section 3 factors should be considered so far as they are relevant and in light of them a single assessment of reasonable financial provision should be made.
- For adult children, reasonable financial provision is limited to “maintenance” which is something more than what is necessary to subsist but does not extend to everything that would be desirable for the claimant to have.
- That whilst the needs and expectations of the adult claimant will need to be considered carefully, it is not desirable or necessary to consider the needs and expectations of any beneficiary named in a will since the testator’s wish to leave them something should be enough.
- Dismissing the claim (making no award) and awarding reasonable financial provision to Mrs Illott would both have been legitimate outcomes in the circumstances of this case.
Whilst this decision goes someway to clarifying the factors which the court will have regard to when determining the level of provision that should be made for successful claimants, some of the Supreme Court Justices have been critical of the current law in this area and its failure to give clear guidance as to the factors to be taken into account in deciding whether an adult child is deserving or undeserving of an award.
Whilst adult children of a deceased will continue to be able to seek redress from the courts where a will or the rules of intestacy fail to make reasonable financial provision for them, today’s judgment of the Supreme Court is likely to be welcomed by those who felt there was a need to rebalance the law in favour of the wishes of the testator, as against the interests of disinherited adult children. The Supreme Court has highlighted the importance of taking into account the testator’s wishes and confirmed that circumstances such as the estrangement of adult children may be a significant factor.
Source: DWF LLP