Charities fight back to claim bequests

Later this month, the Supreme Court is set to consider provisions in the Inheritance (Provision for Family and Dependants) Act 1975 as charities seek to preserve their bequests following a ruling in favour of the testator’s estranged daughter.

There have been a number of high profile news stories regarding will disputes and inheritance issues hitting the press recently. However, later this month, the Court of Appeal is set to consider a case that has been in the news despite a lack of celebrity involvement or vast sums of money. Let’s look at the story so far in Ilot (Respondent) v Blue Cross and others.

The Facts

The testatrix left her entire estate to a number of animal charities, and made no provision for her estranged daughter. The testatrix had no connection with the charities and the estrangement had arisen because the testatrix did not approve of her daughter’s behaviour leaving home and marrying a man she did not approve of. The daughter said that she did not expect to be left anything in the will, but brought a claim under the Inheritance Act for ‘reasonable financial provision’.

• The daughter was originally awarded £50,000 but appealed and the Court of Appeal increased the award to allow her to buy her housing association house (£143,000) and awarded an additional £20,000, structured in a way that would allow her to retain her state benefits;
• The Court of Appeal found that the mother had acted in an unreasonable capricious and harsh way towards her daughter. The fact that the daughter had no expectation of being recognised under the will did not have any bearing on the amount she should receive as ‘reasonable financial provision’ (something the court had found at the first hearing).
• In approaching the question of the standard of ‘maintenance’ under the Inheritance Act, the Court of Appeal first looked at whether the daughter’s standard of living was sufficient. The provisions are not there to provide an improved standard of living, but the court should not be limited to ensuring a ‘subsistence’ level.

The Questions for the Supreme Court

The charities involved, the Blue Cross, the RSPCA and the RSPB are obviously motivated by a desire to ensure that they are allowed to keep monies that will help them continue their charitable work. They see it as vitally important to gain clarity about how the provisions in the Inheritance Act should be applied in these circumstances. Resolution will also be helpful for individuals seeking to leave bequests to charity at the expense of family members and dependants who might otherwise have a claim under the Inheritance Act.

The questions for the Supreme Court relate to the Court of Appeal’s decision to set aside the original award of £50,000 as being too small; to the Court’s approach to the ‘maintenance’ standard’ and finally, whether the Court was right to structure the award to Mrs Ilot so that her state benefits were preserved.

Of course, the case also raises important questions about the extent to which people may be able to use the Inheritance Act in future to override the wishes of a testator who has left bequests to charity. There is also a question over whether the Court of Appeal would have been so generous if Mrs Ilot had been in employment and was able to support herself. The Court also suggested that because Mrs Ilot had not wanted to be estranged from her mother, the estrangement was a less relevant factor in the overall scheme of factors that had to consider.

We will be watching the case carefully and will bring you more news once we have the judgement!