Wills And The IPFDA 1975

Question 1

What requirements must be satisfied for a will to be valid?

Answer 1

Capacity, Knowledge, Formal requirements - s.9 Wills Act 1837

Question 2

What does the case of Banks and Goodfellow require regarding capacity?

Answer 2

1. Understand the nature of the act and its effects; 2. Appreciate the extent of the property of which they are disposing; 3. Understand and appreciate the moral claims to which they ought to give effect; and have no disorder of the mind that perverts their sense of right or prevents the exercise of their natural faculties in disposing of property by will.

Question 3

Is the testator required to understand every detail of the will?

Answer 3

No. They must be able to understand the broad effects of the will.

Question 4

When must the testator have testamentary capacity?

Answer 4

At the time the will is executed.

Question 5

When can a testator who lacks capacity at the time of execution still make a valid will?

Answer 5

Had testamentary capacity at the time they gave instructions for the preparation of the will; and the will was prepared in accordance with those instructions; and at the time of execution the testator understood they were signing a will for which they had previously given instructions.

Question 6

Will the effects of depression and other mental health conditions be taken into account when assessing capacity?

Answer 6

Yes.

Question 7

What is the golden rule?

Answer 7

When taking instructions for a will from a client who is elderly or seriously ill, a medical practitioner should be instructed to make an assessment of the testator’s capacity.

Question 8

Is the golden rule a legal requirement?

Answer 8

No, but it is considered best practice.

Question 9

Who does the burden of proof lie with for proving capacity?

Answer 9

Technically lies with the propounder of the will. However, capacity is presumed if the will on the face of it appears rational and has been duly executed.

Question 10

What must a person who wishes to challenge the validity of the will on the grounds of lack of capacity provide?

Answer 10

Evidence sufficient to raise doubt.

Question 11

Which should prevail, the Mental Capacity Act or the common law test?

Answer 11

Common law test (Banks vs Goodfellow).

Question 12

What must the testator have to satisfy knowledge and approval?

Answer 12

Specific intention to make the particular will they sign.

Question 13

Is knowledge and approval presumed if the testator has testamentary capacity?

Answer 13

Yes.

Question 14

When is there no presumption of knowledge or approval?

Answer 14

The testator is blind or illiterate, the will was signed by someone on behalf of the testator, or there are suspicious circumstances.

Question 15

Does undue influence apply to particular gifts?

Answer 15

Yes.

Question 16

What is the result when a whole will has been made as a result of undue influence?

Answer 16

The will is invalid.

Question 17

When part of a will has been made as a result of undue influence, when will the remainder be given effect?

Answer 17

When the omissions do not upset the whole tenor of what remains, but the court cannot add or substitute words.

Question 18

What are the key principles regarding undue influence set out in Re Edwards?

Answer 18

Undue influence occurs where a testator is coerced into making a will, or including particular terms, against their judgement and contrary to their true intention. The testator does not genuinely exercise choice but has surrendered to pressures they were not able to withstand. Goes beyond persuasion. Whether undue influence has occurred is a question of fact.

Question 19

What factors are relevant when considering undue influence?

Answer 19

The physical and mental strength of the testator are relevant when determining how much pressure would be necessary to overbear the will.

Question 20

What must a valid will comply with under s.9?

Answer 20

(a) it is in writing, and signed by the testator, or by some other person in his presence and by his direction; and (b) it appears that the testator intended by his signature to give effect to the will; and (c) the signature is made or acknowledged by the testator in the presence of two or more witnesses present at the same time; and (d) each witness either (i) attests and signs the will; or (ii) acknowledges his signature, in the presence of the testator.

Question 21

Can any mark constitute a signature?

Answer 21

Yes - Any ‘mark’ may constitute a ‘signature’ if the testator intends it to be, but it is preferable for a testator to use their normal signature to avoid doubt.

Question 22

Where should the signature be?

Answer 22

At the end of the will.

Question 23

Is there a maximum number of witnesses for a will?

Answer 23

No, two witnesses are the minimum.

Question 24

Do witnesses need to know a will is being signed or its terms?

Answer 24

No.

Question 25

Who should not act as a witness?

Answer 25

A minor, someone who is blind, drunk or of unsound mind should not act.

Question 26

Is there a legal requirement to include an attestation clause?

Answer 26

No.

Question 27

What presumption will an attestation clause raise?

Answer 27

A presumption that the will was executed in accordance with the requirements of s 9 WA.

Question 28

In the absence of a poorly worded attestation clause, what is required?

Answer 28

Proof of proper execution.

Question 29

Should the attestation clause be amended if the will is executed in special circumstances?

Answer 29

Yes.

Question 30

Can a beneficiary of a will be a witness?

Answer 30

No. If a beneficiary or their spouse is a witness to the will, any gifts made to them will be void.

Question 31

Can a beneficiary still inherit if there are another 2 valid witnesses?

Answer 31

Yes.

Question 32

What is the purpose of the commencement of a will?

Answer 32

To identify the testator (stating their full name and address).

Question 33

Is a will valid without a revocation clause?

Answer 33

Yes, but one should be included as a matter of good drafting.

Question 34

Apart from a revocation clause, how else can a will be revoked?

Answer 34

Codicil, marriage/divorce, destruction of the will, or making effective manuscript amendments.

Question 35

Are burial and funeral wishes legally binding on the personal representatives?

Answer 35

No.

Question 36

Who cannot be an executor?

Answer 36

A minor or someone who lacks mental capacity cannot act.

Question 37

Is there a minimum number of executors needed to be appointed?

Answer 37

Yes - 1.

Question 38

What is the maximum number of executors who can apply for the grant of representation?

Answer 38

4.

Question 39

Who can charge for their time as executors?

Answer 39

Only professional executors and trustees may charge for their time.

Question 40

How do executors and trustees roles differ?

Answer 40

An executor’s primary duty is to administer the estate. A trustee is responsible for the management of any trusts that continue following the estate administration.

Question 41

What is the structure that most wills will follow?

Answer 41

1. Introductory clauses, 2. Appointment of executors and guardians, 3. Dispositive clauses, 4. Administrative provisions, 5. Execution/attestation.

Question 42

Can an executor’s appointment be qualified?

Answer 42

Yes, e.g. qualified by time.

Question 43

What is legacy usually referring to?

Answer 43

‘Legacy’ normally refers to a gift of chattels or personalty.

Question 44

What is devise usually referring to?

Answer 44

‘Devise’ is normally used in relation to gifts of real property (land).

Question 45

What happens to a specific gift that the testator no longer owns at death?

Answer 45

The gift will lapse, unless an alternative item or cash equivalent is specified.

Question 46

What is a demonstrative gift?

Answer 46

A type of general legacy which the will directs should be paid out of a specified fund.

Question 47

Will a demonstrative gift fail if there are insufficient assets in the specified fund?

Answer 47

No, the beneficiary is entitled to receive what is left in the fund.

Question 48

If clauses relating to the residuary are not properly drafted, what may be the result?

Answer 48

Partial intestacy.

Question 49

In the event of a failure of a specific, general or pecuniary gift, what will happen to the gift?

Answer 49

Fall into the residue estate.

Question 50

From what date does the will speak?

Answer 50

The will speaks from the date of the testator’s death.

Question 51

What words show a contrary intention, to the will speaking at the time of death?

Answer 51

Words like ‘my’, ‘now’, or ‘at present’ can cause specific gifts to adeem.

Question 52

When is the will deemed to speak when identifying people?

Answer 52

Deemed to speak from the date of execution.

Question 53

What do relieving provisions deal with?

Answer 53

Relieving provisions deal with matters such as who should bear the burden of taxes, charges, expenses, and costs.

Question 54

In the absence of an express provision, where is IHT payable out of?

Answer 54

In the absence of an express provision, IHT is payable out of the residue as a general testamentary expense.

Question 55

In the absence of an express provision, where are expenses and costs of transfer payable out of?

Answer 55

Beneficiaries bear the burden of the cost of delivery of the item of property to them.

Question 56

Where are charges paid out of if there is no express provision in the will?

Answer 56

The asset charged bears liability for payment. The beneficiary will inherit the property subject to the charge.

Question 57

What happens if a clause within a will is unclear or ambiguous?

Answer 57

The courts may rule on how it should be constructed, with the intention of the testator being the overriding principle.

Question 58

What happens if a beneficiary predeceased the testator?

Answer 58

The gift will lapse.

Question 59

Are items that comprise a collection identified at the date of death?

Answer 59

Yes.

Question 60

Who does a gift to children include?

Answer 60

Illegitimate, legitimated, and adopted children. A stepchild is not included unless the will clearly indicates this intention.

Question 61

What is the general rule for class closing?

Answer 61

A class closes when any one member of the class first becomes entitled in possession.

Question 62

If no contingency applies, when does a class close?

Answer 62

The class closes on the date of death, provided there is at least one person who satisfies the definition.

Question 63

What is a vested interest?

Answer 63

A gift vests if it is given outright and absolutely, with no conditions to be met.

Question 64

Can a minor give good receipt of capital?

Answer 64

No, a vested gift to a minor is held on trust until the child attains 18.

Question 65

What is a contingent interest?

Answer 65

A contingent gift is made where a beneficiary must satisfy a condition before inheriting.

Question 66

If there are no express substitution clauses, when can s.33 apply to prevent a gift lapsing?

Answer 66

s.33 Wills Act 1837 may apply to prevent the gift lapsing if the intended beneficiary dies before the testator, leaving issue that are living at the testator’s death.

Question 67

Will s.33 always apply?

Answer 67

Yes, unless excluded by the will.

Question 68

What doctrine applies to charitable gifts?

Answer 68

The cy-pres doctrine applies; if a named charity no longer exists, the gift will go to another charity with similar purposes.

Question 69

What does IPFDA 1975 allow the court to do?

Answer 69

The court can make provision for an applicant if it feels reasonable financial provision has not been made from the deceased’s estate.

Question 70

Who is eligible to make a claim under IPFDA?

Answer 70

An applicant must be within the jurisdiction of the IP(F)DA 1975, demonstrate they fall within a recognized category, and make their claim within the prescribed time limit.

Question 71

What jurisdiction does the IPFDA apply in?

Answer 71

It only applies where the deceased died domiciled in England and Wales.

Question 72

What are the recognized categories of applicants under IPFDA?

Answer 72

Spouse/civil partner, former spouse/civil partner who has not remarried, cohabitant for two years, child of the deceased, treated as a child, or maintained by the deceased.

Question 73

When must an application under IPFDA be made?

Answer 73

Within 6 months of the grant of representation.

Question 74

Can the time limit for making a claim under IPFDA be extended?

Answer 74

Yes, the Court has discretion to extend the time limit.

Question 75

What should the court take into account when deciding whether to grant an extension of time to apply under IPFDA?

Answer 75

The court should consider the circumstances surrounding the delay, whether negotiations were commenced, if the estate had been distributed, and if refusal would leave the applicant without recourse.

Question 76

When making a claim in the high court, when is it more appropriate to use the Family Division rather than the Chancery Division?

Answer 76

When an application is made by a spouse, civil partner, or cohabitee without complex issues of interpretation.

Question 77

What are the grounds for making a claim under the IPFDA 1975?

Answer 77

That the deceased’s will did not make reasonable financial provision for the applicant, or that intestacy rules fail to make reasonable provision.

Question 78

What orders can the court make under IPFDA 1975?

Answer 78

Periodical payments, lump sum, transfer of property, settlement of property, acquisition of property for transfer, and variations of marriage/civil partnership settlements.

Question 79

What is the surviving spouse standard for reasonable financial provision?

Answer 79

Such financial provision as it would be reasonable for a husband or wife or civil partner to receive, regardless of maintenance needs.

Question 80

What is the maintenance standard for reasonable financial provision?

Answer 80

Such financial provision as it would be reasonable for the applicant to receive for maintenance, considering their living needs.

Question 81

What is the key difference between the surviving spouse standard and the maintenance standard?

Answer 81

The surviving spouse standard does not require consideration of maintenance needs, making it a higher standard.

Question 82

When can the court extend the surviving spouse standard?

Answer 82

When the applicant is a former spouse/civil partner who has not remarried, or a spouse judicially separated, with certain conditions.

Question 83

Under s.3(1) IPFDA, what must the court have regard to?

Answer 83

The applicant’s financial resources and financial needs
The financial resources and financial needs of any other applicants
The financial resources and financial needs of any beneficiary of the estate
Any obligations and responsibilities which the deceased had towards any applicants or beneficiaries
The size and nature of the net estate of the deceased
Any physical or mental disability of any applicant or beneficiary
Any other matter the court considers relevant in the circumstances (including the conduct of the applicant or any other person)
When considering a person’s financial resources and needs, the court must take into account any resources and needs they are likely to have in the foreseeable future.

Question 84

What additional considerations does the court have in relation to spouses?

Answer 84

The applicant’s age, duration of marriage/civil partnership, and contributions to the family welfare.

Question 85

What specific guidelines apply to cohabitees?

Answer 85

The age of the applicant, length of cohabitation (at least 2 years), and contributions to the family welfare.

Question 86

What additional considerations does the court have in relation to children of the deceased?

Answer 86

Under s 3(3) where the applicant is a child of the deceased, the court must also consider the manner in which the applicant was (or might expect to be) educated or trained:

This section also applies if the applicant was not a child of the deceased, but was treated as such, but the court must also consider:

Whether and on what basis the deceased maintained the applicant, for what time they did so and the extent of their contribution.
Whether and, if so, to what extent the deceased had assumed responsibility for the applicant’s maintenance.
Whether in maintaining or assuming responsibility for maintaining the applicant the deceased did so knowing that the applicant was not their child.
The liability of any other person to maintain the applicant.

Question 87

What does ‘maintained by the deceased’ mean?

Answer 87

An applicant is treated as maintained by the deceased if the deceased made a substantial contribution towards their reasonable needs.

Question 88

When considering a spouse/civil partner, is the court required to consider relief available on divorce?

Answer 88

Yes, but it is not correct to assume a 50% interest in the estate.

Question 89

What changes can be made to the original estate distribution after a person has died?

Answer 89

Variation, disclaimer, precatory trust, court order under IPFDA, and capital distributions from some will trusts within 2 years of death.

Question 90

What is a variation?

Answer 90

A direction from an original beneficiary to the deceased’s PRs to transfer property they are entitled to under a will or intestacy to another person.

Question 91

Is variation possible after inheritance has been accepted?

Answer 91

Yes.

Question 92

Can the original beneficiary determine who receives the varied inheritance?

Answer 92

Yes.

Question 93

What conditions must variations comply with?

Answer 93

Made by the original beneficiary in writing, within two years of death, with an express statement confirming s142 applies, and not for consideration.

Question 94

When is the approval of PRs needed for variations?

Answer 94

If the variation results in additional IHT, the PRs should sign the variation and provide HMRC with a copy.

Question 95

Does CGT apply to cash assets?

Answer 95

No.

Question 96

When are new beneficiaries deemed to acquire their assets from variations?

Answer 96

At their date of death value.

Question 97

Is there an issue of an additional IHT as a result of variation?

Answer 97

No, because no IHT is payable in respect of the deceased’s death estate.

Question 98

Are there any restrictions on the number of times a will can be varied?

Answer 98

No, but each asset can only be varied once.

Question 99

What property cannot be varied?

Answer 99

Property where the deceased was a life tenant before death, or gifts with reservation of benefit.

Question 100

For IHT purposes, are gifts from the original beneficiary read back to the date of the deceased’s death?

Answer 100

Yes, treated as having been made by the deceased to the new beneficiary.

Question 101

Are the original beneficiaries treated as making a potentially exempt transfer when making a variation?

Answer 101

No, IHT is recalculated as though the deceased left the property to the new beneficiary.

Question 102

What is a disclaimer?

Answer 102

A disclaimer is a refusal to accept property to which a beneficiary is entitled under intestacy or a will.

Question 103

What are the limitations to disclaimers?

Answer 103

A beneficiary can only disclaim before acceptance

A beneficiary can only disclaim the whole gift

A disclaimer of a beneficiary’s rights under a will does not disclaim their rights under any intestacy which may arise as a consequence of disclaiming their testamentary inheritance

The inheritance passes as if the gift to the original beneficiary had failed.

The original beneficiary cannot control who receives the assets they disclaim.

Question 104

Do disclaimers and variations have the same IHT and CGT implications?

Answer 104

Yes, the original beneficiary is not treated as having made a transfer.

Question 105

When does a precatory trust arise?

Answer 105

When a gift is made with a wish expressed on how the beneficiary should pass on those assets.

Question 106

Are the testator’s wishes binding in a precatory trust?

Answer 106

No.

Question 107

How are distributions made under a precatory trust treated for IHT purposes?

Answer 107

IF within 2 years of the testator’s death, these are treated for IHT purposes as gifts
made by the testator’s will and not the original beneficiary.
the original beneficiary is not treated as having made a PET of these items, which would otherwise be the case.

Question 108

How are distributions made under a precatory trust treated for CGT purposes?

Answer 108

Redistribution according to the testator’s wishes is treated as a disposal by the original beneficiary.