April 9, 2018Cohabitee entitled to share of Deceased partner’s £1.5m estate

House in countryside

In a recent decision, the High Court has ruled in favour of a woman who was left nothing from her late partner’s £1.5 million estate.

The case involved a claim brought under the Inheritance (Provision for Family and Dependants) Act 1975 by 79-year-old Joan Thompson against the estate of her late partner, Wynford Hodge. The Deceased left his entire estate, valued at £1,535,060, to tenants and friends. In an accompanying letter of wishes, he wrote:

“In my Will I have specifically made no provision for my partner, Joan Thompson and her children, Gary, Lee, Dean and Sharon. I currently have no contact with Joan’s children. I have no issue with Gary, but I have concerns regarding Lee, Dean and Sharon and do not trust them. I feel that they have previously taken advantage of me and have already received/taken monies from me during my lifetime. I do not want Joan or her children to inherit from my estate.”

“I no longer want to leave my residuary estate on trust to pay the income to Joan for her life as this would be a substantial sum and I do not believe she will need it. Also due to Joan’s health I believe she would not be able to live in my property independently. I am Joan’s main carer and envisage she may have to go in to a home following my death. I confirm Joan has her own finances and is financially comfortable. Joan has her own money and her own savings.”

Ms Thompson and Mr Hodge had lived together for 42 years ‘as man and wife’. Ms Thompson was financially dependent upon Mr Hodge throughout that time and at his death. Accordingly, the Court found that she was entitled as a cohabitee to claim either under Section 1(1) (ba) or (e) of the 1975 Act that the last Will did not make reasonable financial provision for her. In either case, that meant she could claim under Section 1(2):

“such financial provision as it would be reasonable in all the circumstances of the case for the applicant to receive for [her] maintenance”.

His Honour Judge Jarman QC noted:

“The real issue in this case, in my judgment, is what amounts to reasonable financial provision for Mrs Thompson’s maintenance. The powers of the court to make orders to provide for such provision are set out in Section 2 of the Act and are very wide. It is not in dispute that this includes provision for her accommodation and care needs.”

The judge went on to consider Ms Thompson’s needs, together with the needs and resources of the fourth and fifth defendants to the claim, Karla Evans and Agon Berisha – the tenants who stood to receive a substantial portion of Mr Hodge’s estate under his Will.

He further considered what obligations and responsibilities the Deceased had towards Ms Thompson and towards the tenants Ms Evans and Mr Berisha. Notably the Deceased’s earlier
Wills did make provision for Ms Thompson, and his reasons for not making provision in his most recent Will were that she would not need the money. Mr Hodge believed she would not be able to live in any property independently and would need to go into a home following his death – but in fact the most recent medical report indicated that Ms Thompson was

“…certainly fit enough to reside in private accommodation with a relevant social care package.”

Further relevant factors included the length of time and the basis on which Mr Hodge maintained Ms Thompson, the extent of the contribution, and the extent to which he assumed responsibility for her maintenance.

The Judge held that it was reasonable Ms Thompson should have Elidyr Cottage, worth £225,000, for her accommodation – a property that had originally been purchased for the couple to reside in.

He considered the question of whether Elidyr Cottage should be transferred to her outright or whether she should be offered a life interest,  referring to the recent well-publicised case of Ilott v The Blue Cross. In that case, the Supreme Court emphasised that the statutory power is to provide maintenance, not to confer capital. In the Ilott judgement Lord Hughes referred to an earlier similar case involving an adult child (Re Myers) in which the award made was not of an outright capital sum but of a life interest together with power of advancement designed to cater for the possibility of care expenses in advanced old age. Lord Hughes observed that:

“If housing is provided by way of maintenance, it is to be provided by way of maintenance, it is likely more often to be provided by such a life interest rather than by a capital sum.”

However, there are other cases where an outright transfer has been made: for example, in Negus v Bahouse a flat was awarded outright to the cohabitee of the deceased on the basis that a clean break was needed from the deceased’s family; and a similar approach for similar reasons was taken in Webster v Webster.

Noting that all cases are fact sensitive, his Honour Judge Jarman QC ruled that it was reasonable for Ms Thompson to have Elidyr Cottage outright rather than a life interest. This would allow Ms Thompson to take decisions relating to her home, such as making structural alterations or raising money without the need to seek permission. In addition, the judge awarded £28,844.68 for necessary alterations, and £160,000 for future maintenance and care. This left the tenants Ms Evans and Mr Berisha with by far the major part of a substantial estate.

Judge Jarman concluded:

“Whilst the wishes of Mr Hodge that Mrs Thompson’s family should not benefit from any provision for her should be given appropriate weight, those wishes should not hinder the reasonable provision for her maintenance. That is the mistake that he made in his letters of wishes which led to no provision at all being made.”

References:

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