In March 2017, the Supreme Court unanimously ruled in favour of three animal charities in a battle concerning the right of an adult child, deliberately excluded from a parent’s will, to obtain maintenance under the Inheritance (Provision for Family and Dependants) Act 1975 (the Inheritance Act 1975).
Mrs Jackson died leaving approximately £486,000 to three randomly selected charities. She had been estranged from her 55 year old daughter, Mrs Illot, for some years prior to her death and excluded Mrs Illot entirely from her will. So strong were Mrs Jackson’s feelings, she provided firm instructions to her solicitors that her daughter was not to benefit from her estate in any way and encouraged her executors to fight any claim that Mrs Illot may bring.
Undeterred, Mrs Illot, who lived in ‘modest’ circumstances (she relied on state benefits with an annual income of around £20,000) with five children, commenced proceedings under the Inheritance Act 1975 on the basis that her mother had not made ‘reasonable financial provision’ for her.
Following the trial, the court awarded £50,000 to Mrs Illot. However, this sum was increased by the Court of Appeal to £143,000 (the sum required for Mrs Illott to buy her housing estate home) plus the amount of the reasonable costs of acquisition and the option to take a further £20,000. The Court considered that the sum was necessary to prevent a life of poverty for Mrs Illot, who claimed she could not afford to go on holiday or buy clothes for her children.
The Court of Appeal decision sparked fierce debate regarding testamentary freedom and the weight attributable to an adult child’s financial needs when considering an award under the Inheritance Act. The defendant charities, concerned about the potential impact of the decision on other cases, appealed.
The defendants breathed a sigh of relief when a Supreme Court panel including Lord Neuberger (president), Lady Hale (deputy president) and Lord Sumption held that the first instance judge had not erred in its application of the law and reinstated the initial award of £50,000.
The decision confirms that financial need alone does not give an automatic right to, and is not the determinative factor for, provision under the Inheritance Act 1975. Indeed, the Supreme Court highlighted the significance of testamentary freedom and that an award under the Inheritance Act 1975 is at the expense of those that the testator intended to benefit. Charities, in particular, rely on testamentary bequests and should not have to justify their entitlement to the same. Moreover, the Supreme Court considered it proper to consider the relationship between the parent and child which, in this case, may have led some judges to conclude that the claim should have been dismissed altogether.
The decision is now the main authority on needs-based claims under the Inheritance Act 1975, though it is interesting that Lady Hale considered it necessary to stress the unsatisfactory state of the present law and it will be interesting to see if legislators consider it necessary to provide further guidance in years to come.