Chapter 20: Claims Against Estates Under Inheritance (Provision for Family and Dependants) Act 1975

Question 1

What is freedom of testation?

Answer 1

Under English law, testators may dispose of the whole of their estate under the will as they think fit.

There is no requirement that they must leave part of their estate to their children, for example.

Question 2

What does the Inheritance (Provision for Family and Dependants) Act 1975 allow for?

Answer 2

An application for family provision may be made to the court to set aside the terms of a will (or vary an intestacy) of a person who died domiciled in England and Wales on the grounds that reasonable financial provision has not been made for the applicant.

Question 3

When may a family provision claim be made against a person who was not domiciled in England and Wales?

Answer 3

In some circumstances, if the deceased left property and family members or dependents there

Question 4

What is the time limit for bringing a family provision claim under the Inheritance (Provision for Family and Dependants) Act 1975?

Answer 4

An application must be made within 6 months from the issue of the grant of representation to the PRs, or later with leave of the court

Question 5

When are PRs protected from personal liability against family provision claims?

Answer 5

Protected from any personal liability arising under any late permitted claim, provided that they wait 6 months from the date of the grant before distributing the estate to beneficiaries.

Question 6

What categories must the applicant fall within one of ?

Answer 6

1. Surviving spouse or civil partner,
2. Former spouse or civil partner who has not remarried nor formed a civil partnership
3. A child of the deceased or a person treated as a child of the family of the deceased (e.g., a stepchild)
4. A person who was being maintained, wholly or partly, by the deceased before the death
5. A person who was living with the deceased during the whole of the 2-year period immediately before the death as the spouse etc.

Question 7

When may a former spouse or civil partner be barred from making a claim?

Answer 7

Through a ‘clean break’ divorce

Question 8

What is needed if someone who was being maintained by the deceased wants to bring a claim?

Answer 8

Deceased needs to have been making substantial contributions towards the reasonable needs of the claimant

Question 9

What is the process for determining what constitutes reasonable financial provision?

Answer 9

Two-part:
1. Have the will or intestacy rules failed to make reasonable financial provision for the applicant?

2. If so, what would be such provision?

Question 10

What is the standard for spouses?

Answer 10

Such financial provision as would be reasonable in all the circumstances, whether or not required for maintenance.

The court should consider what would be awarded in a divorce

Question 11

What discretion does the court have when determining the standard for former spouses?

Answer 11

The court has discretion to apply the surviving spouse standard to former spouses if the death occurs within 12 months of the decree absolute and no final order has been made in those divorce proceedings

Question 12

What is the standard for applicants other than spouse?

Answer 12

Such provision required for their maintenance, such that they can live decently and comfortably according to their situation.

Test is objective, although evidence of the deceased’s reasons for not providing in their will for an applicant is admissible.
> Reasons could be set out in the will itself or in an accompanying private document

Question 13

What do guidelines considered by the court include when determining what to give the applicant?

Answer 13

1. Financial resources and needs of the applicant, any other applicant, and any beneficiary (now or in the future)
2. Any moral obligation of the deceased to any applicant or beneficiary
3. Size and nature of the net estate of the deceased, and
4. Physical or mental disability of any applicant or beneficiary

Question 14

What happens if the court approves the application?

Answer 14

The estate devolves according to the terms of the court’s order and not in accordance with the will or the rules on intestacy

Question 15

What types of orders can the court make?

Answer 15

The court has very wide discretion and has the powers to make the following orders:

1. Transfer of property
2. Payment of a lump sum
3. Payment of income, and
4. Settlement of property on trust

Question 16

What is the most common type of order the court will make?

Answer 16

Lump sum payment (cash or asset transfer), but periodical payments can be ordered.

Question 17

What can orders be made out of?

Answer 17

The deceased’s net estate at the date of death, and the deceased’s severable share of a joint tenancy.

Question 18

When does the court have the power to make an order regarding property disposed of by the deceased before death?

Answer 18

If that disposal was intended to avoid the provisions of the 1975 Act.

Question 19

How are any orders treated for IHT purposes?

Answer 19

Any order is read back to the date of death