If I claim against an estate, how much am I likely to get?

Assessing a claim against an estate
We look at the approach of the Courts in relation to assessing how much to award in claims against estates, including the recent case of Wellesley.

In our recent post ‘Making an Inheritance Act claim‘ we explained the two step process that a Court will take when assessing a claim – namely,

(1) The Court must first ask the threshold question: does the estate make reasonable financial provision for the applicant? and this is decided taking into account all factors within Section 3 of the Inheritance Act.

(2) Only if the Court is so satisfied that the threshold question has been met can it consider exercising its power to make an award for ‘reasonable financial provision’ under s2 of the Act.

‘Reasonable financial provision’ for a spouse or civil partner means such financial provision as it would be reasonable in all the circumstances of the case for them to receive, whether or not that provision is required for his or her maintenance. The process would therefore be parallel to the financial assessment made following a divorce. In all other cases (including adult children), reasonable financial provision means such provision as would be reasonable for maintenance.

Per Lady Hale in Ilott, the law provides no definitive guidance as to the weight of each s3 factors when deciding whether an adult child is deserving of reasonable maintenance.[1] Ilott, and many other cases that have developed in this area, demonstrate that there is significant judicial latitude in applying the factors and each case turns on its own facts.

Over the years, some patterns have emerged in the orders made – for example, until recently, case law has suggested that when adult children are successful, the awards tend to be around the 10% mark[2]. If cohabitees are awarded an interest in the family home, historically this has tended to be a life interest[3].

However, maintenance awards to cohabitees are not always modest: in Musa v Holliday[4] (confirmed in Thompson[5]) the judge refused an appeal regarding an award to the cohabitee which was for a substantial part of the estate for their maintenance. In Thompson[6] the courts made a capital award to a cohabitee rather than granting a life interest.

Indeed, the suggestion by the applicant in Wellesley v Wellesley that a reasonable approach to valuing the size of her claim would be 10 to 13 per cent of the net estate in line with past cases was rejected.

When decisions depart from a ‘norm’, legal commentators are quick to question whether there has been a change of approach. For example, it was noted that the decision in Thompson ‘side stepped’ Lord Hughes’ views in Ilott that housing should be limited to a life interest.[7] However, in the later cases of Banfield v Campbell[8] and Martin v Williams[9] the court once again found a life interest appropriate (causing legal commentators to observe a ‘resurgence of life interests’ in 1975 Act claims).[10] This desperate scrutiny of the courts’ decisions reflects the desire for more solid guidance but in reality, all cases are fact sensitive and must be viewed individually.[11] In Wellesley, Deputy Master Linwood reminded the Court that quantification was one part of the judicial exercise and over reliance on previous authorities must be avoided in view of the wholly different factual scenarios. Further, it must be borne in mind that provided that proper consideration of the s3 factors is made, a later court cannot interfere with an earlier court’s decision. One judge may therefore exercise their discretion in a different way from another judge.

If you believe you might have a claim, it is important to seek legal help as early as possible. For some types of claim, time limits are very strict. We can advise you on the merits of your claim and the options open to you. We offer free initial advice on claims against an estate, whether the dispute is for reasonable financial provision or there is some concern over the Will.

Find out more about contesting a Will or get in touch for help.

Sources:

[1] Ilott (Respondent) v The Blue Cross and others (Appellants) [2017] UKSC 17 at [66] (Lady Hale).

[2] E.g. Nahajec v Fowle [2017] EW Misc 11(CC)(18 July 2017); and Ilott (above).

[3] Ilott (above) at [15] (Lord Hughes), referring to In re Myers [2005] WTLR 851.

[4] Musa v Holliday [2012] EWCA Civ 1268.

[5] Thompson v Ragget & Ors (Rev 1) [2018] EWHC 688 (Ch) (29 March 2018).

[6] Thompson v Ragget (above).

[7] E.g. Lewis Addison, ‘Thompson v Raggett & Ors: Applicant Awarded Property Outright’ (Nelsons, June 8 2018).

[8] Banfield v Campbell [2018] EWHC 1943 (Ch).

[9] Martin v Williams [2017] EWHC 491 (Ch).

[10] Ilott (above) at [16]; Edward Hewitt, ‘A resurgence of life interests in 1975 Act claims’ (Trusts and Estates, October 2018) 6-8.

[11] Thompson v Ragget (above) at [37] (Judge Jarman).

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