Sarah Burgess of AMD Solicitors discusses the recent Supreme Court Appeal of Ilott v Mitson
Background
The widely publicized case of Ilott v mitson is about a daughter’s claim against her late mother’s estate despite being estranged for 26 years.
Melita Jackson (the deceased) and her daughter (Heather Ilott) fell out when Heather, aged 17, left home in the middle of the night to elope with a boy that her mother strongly disapproved of. Melita never really forgave her daughter even though Heather later married and had 5 children with her childhood sweetheart.
Over the years, there were several attempts at reconciliation between mother and daughter but most of them were short-lived. Melita Jackson made her last Will and Testament in April 2002 leaving the majority of her £486,000 to several animal charities, expressly excluding her daughter. She even wrote to her daughter to tell her that she had been disinherited so Heather had no expectations about receiving anything from her mother’s estate. Melita felt so strongly about excluding her only daughter that she left instructions that her executors must defend any claims against her estate.
Heather Ilott at the time of her mother’s death in 2004 lived with her family in housing association accommodation and their main source of income was state benefits. She made a claim under the Inheritance Act (Provision for Family and Dependants) 1975 for ‘reasonable financial provision’ because as a child of the deceased she was an eligible claimant and she had a clear financial need.
Court Judgments
- In the first instance, Mrs Ilott was successful and awarded £50,000. Mrs Ilott appealed on quantum and the charities appealed the decision.
- The High Court held that the appeal on quantum was dismissed but the charities’ appeal on threshold was allowed.
- The Court of Appeal re-instated Mrs Ilott’s claim but held that quantum should be determined by the High Court.
- The High Court upheld the original award of £50,000. It was appealed.
- The Court of Appeal awarded Mrs Ilott the sum of £143,000 plus an option to draw down a further £20,000 at will. The award was calculated so that Mrs Ilott could purchase her home from the housing association and so as not to disrupt her right to state benefits. The charities appealed the decision to the Supreme Court.
- On 15 March 2017, the Supreme Court overturned the Court of Appeal decision and re-instated the original judgment from 12 years earlier which awarded Mrs Ilott £50,000.
Supreme Court Judgment
There were two written judgments; Lord Hughes gave the lead judgement focusing on why the Court of Appeal was wrong to criticise the District Judge’s findings and Lady Hale wrote about research which showed that public opinion was divided about whether adult children should be able to claim against their parent’s estate. She also pointed out that the legislation offers little guidance about how to value competing interests which is why advising clients about the value of an inheritance act claim is very difficult for lawyers.
Lord Hughes’ stated, “the Act requires a single assessment by the judge of what reasonable financial provision should be in all the circumstances of the case.” In other words, there isn’t a set calculation that can be applied in every claim – the court has wide powers of discretion and provided they consider the specific needs of the potential claimants and beneficiaries of an estate they will have fulfilled the requirements of the legislation.
Even the terminology used in the legislation is flexible, for example, ‘maintenance’ usually means what is sufficient to meet every day expenses but this varies depending on personal circumstances (such as employment status, martial status, number of dependants, benefits, disability etc.) The court confirmed that maintenance cannot extend to ‘any or every thing which it would be desirable for the claimant to have’ and suggested that “very often” it would be more appropriate to satisfy an income need by a capitalised lump sum. However, where there is a housing need a life-interest was considered to be appropriate.
The test under the 1975 Act is an objective one:-
1) did the will or intestacy provisions make reasonable financial provision for the claimant?
2) if not, what reasonable provision ought to be made for the claimant now?
The Supreme Court judgment states there is a ‘very large overlap between the two stages’ which indicates that courts will be more willing in the future to take a rounded view. In other words, if a claimant shows reasonable provision has not been made for them, they should receive an award from the court unless their conduct has been really poor.
The main points we can take from the judgement are:
- testamentary freedom has been preserved;
- it has restored charities’ status as proper beneficiaries;
- there is no requirement for a moral claim under 1975 Act;
- estrangement is a relevant factor (conduct);
- appellate courts should not inter with trial judges unless there has been an error of law
The charities’ appeal was successful but what does this mean for potential inheritance act claimants?
In summary, the law governing claims under the IPFDA 1975 has not changed. Adult children are still eligible claimants under the terms of the Act.
The factors courts consider when hearing inheritance act claims include:
- any financial resources or needs (present or future) of the claimant
- any financial resources or needs (present or future) of any other potential claimants
- any financial resources or needs (present or future) of the beneficiaries
- any obligations or responsibilities the deceased had towards the claimant or a beneficiary
- the size and nature of the estate
- any mental or physical disability of the claimant or beneficiary
- and any other matter the court may consider relevant including the conduct of the parties.
Before bringing an inheritance claim, any potential claimants should obtain professional legal advice regarding the merits of their claim and be willing to engage in alternative dispute resolution to avoid costly (and lengthy!) litigation proceedings.
For more information or to get help from solicitors in Bristol relating to contesting or resisting a claim against an estate contact Sarah Burgess on 0117 9621205 or by email on SarahBurgess@amdsolicitors.com or pop into one of our offices in Clifton, Henleaze, Shirehampton or Whiteladies Road.
