Inheritance Tax  

When and how clients can contest a will

  • List the grounds for contesting a will and why inheritance disputes are rising.
  • Describe what a financial provision claim is.
  • Identify out of court dispute resolutions and how claims can be prevented.
CPD
Approx.30min

As part of any 1975 Act claims, claimants are required to set out in detail their financial means, in order to demonstrate that the provision made for them (or not made for them) by a will or intestacy is not sufficient for their particular set of needs. Each case will be assessed on its own particular facts.

The Supreme Court recently heard its first appeal in relation to a 1975 Act claim in the case of Ilott v Mitson.

In this case an estranged adult daughter brought a claim for financial provision against her mother’s estate.

It is worth noting that the deceased intentionally excluded her daughter from benefitting under her will and instead left her estate to a number of charities. 

The Ilott v Mitson case ran for almost 10 years and saw numerous appeals in the High Court and Court of Appeal before the Supreme Court determined that the original award in the sum of £50,000 should stand.

The total value of the estate was just under £500,000 and therefore the award constitutes approximately 10 per cent of the estate for the daughter who could demonstrate a financial need.

Dispute resolution  

Despite the number of inheritance disputes passing through the courts, it is relatively rare to proceed to trial, so many claims are resolved outside of court.

The fact that legal budgets to trial typically exceed £100,000 focuses warring parties on trying to reach a settlement, and this usually involves mediation.

Mediation is a confidential, voluntary and flexible form of alternative dispute which involves an independent mediator (often an experienced lawyer) assisting the parties to work towards a negotiated settlement.

The advantage to the parties being that they have absolute control of any agreement reached, and the costs of mediation are typically a fraction of the cost of pursuing a claim to trial.

A successful mediation will also eliminate the risk of the losing party paying the winning parties’ costs at the end of any trial.

Can claims be prevented?

It is impossible to make a will immune to challenge.

But wills which are professionally drafted usually stand up to scrutiny more than “homemade wills”, which can be an easy target for claimants if basic mistakes or the wrong language is used. 

In addition, a “letter of wishes” sitting behind a will which explains why it has been drafted in certain terms can form very important evidence if the will is disputed.  

Being open with family members as to the contents of a will can also help manage any expectation of inheritance and potentially see off any disputes before they happen.

Scott Taylor is head of the contentious trusts and estates team at Barlow Robbins

CPD
Approx.30min

Please answer the six multiple choice questions below in order to bank your CPD. Multiple attempts are available until all questions are correctly answered.

  1. Complex family structures can make the division of assets seem contentious and create feelings of what, the author states?

  2. For a will to be valid, the person making the will has to sign it in the presence of who?

  3. Finish the sentence: "Challenges to wills based on lack of capacity have increased almost hand in hand with..."

  4. In cases involving allegations of forgery, the court will usually require a forensic examination report by a handwriting expert to help determine the issue. True or false?

  5. Legal budgets to trial typically exceed how much, according to the author?

  6. Mediation is an alternative form of dispute. Which of the below is not used by the author to describe mediation?

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You should now know…

  • List the grounds for contesting a will and why inheritance disputes are rising.
  • Describe what a financial provision claim is.
  • Identify out of court dispute resolutions and how claims can be prevented.

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