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Published by: Tracy Harris

A New Lease of Life for Testamentary Freedom?

On 15 March 2017, the Supreme Court handed down its Judgment in the long running case of Ilott v. The Blue Cross & Others. This case concerned the estate of the late Mrs Melita Jackson, who died in 2004 leaving the vast majority of her estate, worth a little under £500,000, to animal charities with whom she had no real connection in her lifetime.  Her adult daughter, Mrs Heather Ilott, who had been estranged from the deceased for some 26 years, was specifically excluded from benefitting.  The deceased signed Letters of Wishes in 1984 and 2002 explaining why she had made no provision for her daughter.  The evidence was that Mrs Ilott was aware that she was disinherited in her mother’s Will and she had lived independently of her mother, albeit in straitened financial circumstances.

After Mrs Jackson’s death, Mrs Ilott made a claim against her estate under the Inheritance (Provision for Family and Dependants) Act 1975, which enables certain categories of applicant to make a claim on the basis that the Will of the deceased (or the distribution of their estate on an intestacy) does not, when viewed objectively, make reasonable financial provision for the applicant.

Mrs Ilott’s claim was initially determined by District Judge Million in 2007.  He found in Mrs Ilott’s favour and awarded her £50,000.  She appealed on the basis that she considered the award to be too low and the charity beneficiaries then cross-appealed, arguing that reasonable financial provision had been made for Mrs Ilott in the Will, i.e. none. The High Court Judge agreed with the charities and held that there was no failure to make reasonable financial provision for Mrs Ilott.  She appealed to the Court of Appeal who upheld her appeal and sent the matter back to the High Court for it to determine the amount of the award.  The Judge upheld the original award of £50,000.

Mrs Ilott then appealed that decision and the Court of Appeal upheld her appeal, finding that District Judge Million had made two mistakes of principle – first of all, he did not make clear how he evaluated the effect of the estrangement between Mrs Jackson and Mrs Ilott in his award and secondly he made the award without considering the effect it would have upon Mrs Ilott’s benefits.

The Court of Appeal also took the view that, in order to balance the claims on the estate fairly, it was appropriate to treat a Claimant who is in receipt of state benefits in the same way as one who is elderly or disabled on the basis that this increased their need for living expenses. The Court of Appeal stated that it had balanced Mrs Ilott’s needs against the claim of the charities, whom it said had no competing need (and one does wonder if the Court’s decision may have been different if the estate had been left to other children of the deceased).  The Supreme Court said that the claim of the charities was not on a par with that of Mrs Ilott, as the charities were the chosen beneficiaries of the deceased.  The Supreme Court also pointed out that charities depend heavily on testamentary bequests for their work and, indeed, it was noted that the appeal was brought by the charities largely on principle, because of the potential impact that the Court of Appeal decision would have had on other cases.

In stressing the importance of testamentary freedom in English law, the Supreme Court found that District Judge Million had not, in fact, made either of the errors identified by the Court of Appeal.  The Supreme Court noted that cases under the 1975 Act involve value judgments based on the individual circumstances of each case and highlighted the fact that different judges will come to different conclusions faced with the same facts.  The Supreme Court reinstated District Judge Million’s decision on the basis that he was perfectly entitled to reach the conclusion that he had.

To read the full article click here.