So what needs to be considered by clients who have a complex family such as Step-family dynamics and who wish to make a Will? This factsheet explores some of the considerations which you may find helpful before you draft or update your will.
It will be important to discuss the structure and dynamic of your family with your advisor if you are to end up with a Will that does what you need it to, and which minimises the risk of family conflict at a later stage. The advisor will then be able to guide you as to the best structure for your Will. For example, if your spouse does not get along with your children from a previous relationship, appointing them as co-executors is only likely to lead to a fraught and costly executry, particularly if they are all also beneficiaries of the Will. It will be much better to appoint “neutral” executors – other family members, friends or a professional – who do not have an interest in the estate, can be trusted to rise above emotional issues and to not favour a particular beneficiary or class of beneficiary over the others. Where possible, giving parties who do not get on joint ownership of an asset should also be avoided.
At the other end of the testamentary journey, if, after the death of a family member you find yourself disappointed with, or have questions about, the terms of their Will, it will often be more effective to have a lawyer represent your interest, as he or she will not be afraid to raise questions which you may shy away from. It may also have the benefit of preserving relationships by avoiding matters becoming too personal.
There are a number of legal points to be taken into account too. For example currently in Scotland it is not possible to completely disinherit a spouse or a child (including a child who has been formally adopted) as they have certain fixed “legal rights” in your estate which can’t be overridden by your Will. Conversely, cohabitants and step children don’t have prescribed succession rights, and although cohabitants can apply to the Courts for support from the estate, this only applies where there is no Will. Your adviser will be able to guide you through the various rules so that you understand how they will impact on your family and your estate. He or she will also assist you in structuring your succession arrangements so that you make appropriate provision for the family members you want to benefit, whilst excluding, or minimising, any claims that others could make.
It is also important to be aware that divorce or re-marriage does not automatically revoke an earlier Will. If there is a risk of a previous partner inheriting part of your estate, you should arrange for the earlier Will to be revoked and for a new Will which meets your current requirements to be put in place as soon as possible.
How your Will should be structured will also depend on a number of practical considerations, such as the extent and nature of your assets, and the ages of the beneficiaries. In an ideal world, there will be enough estate to give something upfront to everyone you would want to benefit. That may not be possible however, and instead it may be necessary to use what is known as a “liferent” arrangement. This is most often used where there is a second (or even third) spouse, and children from an earlier relationship. The essence of the arrangement is that the spouse is entitled to income from the estate and to live in any property comprised within it, but does not take on outright ownership or control of it. Instead the estate is managed by Trustees until the spouse’s death, at which point it passes to the children. Whilst this type of arrangement can work well, it is not without its issues. For example, will the spouse be satisfied with a limited interest in the estate, or will he or she prefer to claim legal rights instead, therefore reducing the pot ultimately available for the children? And will the children be happy to wait for their entitlement? This will be particularly pertinent where the spouse is not much older than them, so that the likelihood of the children surviving the spouse to receive their interest is less.
Whilst there may not be much that you can do about this last point (although consideration might be given to making alternative provision for the children, for example through death in service benefits or other life insurance), some people prefer to avoid the complications which liferent arrangements can bring by simply leaving everything to their spouse, on the understanding that the spouse will then make provision for the children under his or her Will. Whilst that may work fine, it will be important to understand that the spouse could change the Will if there is a subsequent family fall out or the spouse enters a new relationship.
Lastly a few words about the options available to a beneficiary who is disappointed with the terms of a parent or spouse’s Will. It may be possible to challenge the Will, for example if there is a belief that the parent or spouse was too ill or infirm to properly understand what he or she was doing, or that he or she had been subject to undue influence or pressure from other family members. This will involve court proceedings, however, and is not a step to be taken lightly. An alternative will be to claim the legal rights mentioned above, or to try to reach a financial agreement with the family members who have benefited. In each case input from a legal advisor will be crucial in ensuring that matters are approached properly and with the best prospects of success for the claimant. This will still involve the beneficiary in legal matters, and in incurring costs at what will already be an upsetting and stressful time. It will be much better, therefore, for anyone with a complex matter to take the time to ensure that they have a Will which suits their needs.