THE SUPREME COURT HAS THE FINAL SAY AFTER ALMOST A DECADE!

The final judgment on Ilott v Mitson has been handed down today after almost a decade of litigation. The charity beneficiaries have been successful and the Supreme Court has had the final say on the matter and restored the original trial judge’s decision to award Mrs Ilott ￡50,000 as opposed to what the Court of Appeal warded her which was ￡143,000 to contribute to the purchase of a house and ￡20,000 in cash to be paid in one or more instalments. 

The case of Ilott v Mitson has been ongoing since 2007 and the Court has changed its mind on how to approach this claim on several occasions. 

Mrs Ilott (the estranged daughter) has still received an award, however this has been reduced by the supreme Court by 70%, and at last providing some (if not arguably still limited) guidance to lawyers on how to advise on claims when faced with an Inheritance Act claim by a disgruntled adult child. The court has pointed out the state of law in this area is not ideal and it is a value judgment. However there is scope to conclude that this decision could now make claims difficult for adult children and encourage executors of a deceased’s estate to fight such claims. Although there is no doubt that nuisance claims as a result will continue. 

The key to this case was its unusual facts and the lack of financial independence of the adult child as a result of benefits. 

The final decision of the courts may cause you to wonder whether your fundamental right to leave your estate to whom you want to is dwindling, thus increasing litigation and 1975 Act claims. However the limitation imposed by the Supreme Court by over turning the Court of Appeal decision is important to emphasise that ultimately we do have have freedom of testamentary disposition in this country. 

The Supreme Court has however reminded everyone that the 1975 Act is in place to empower the courts to alter the Deceased’s will to provide reasonable financial provision for someone if the deceased has failed to do so. It is there to protect a small category of people such as spouses, children and those directly maintained by the Deceased. For example did the deceased maintain someone whom he or she then failed to provide for after death? Did the deceased have a duty to provide for his or her children which they failed to do? However the question is what happens when faced with a claim by an adult child? The court has clearly stated that an adult child which has its own independent finances has no need for maintenance from the Deceased’s estate, however what if that adult child does not have access to their own independent finances. What is reasonable provision for their maintenance in those circumstances? Nothing? Not according to Ilott v Mitson. 

What made Mrs Ilott different from any other adult child claimant? She was the deceased' daughter. Should she not be entitled to a share of her mother's estate in the event her mother has failed to provide for her? Did her mother not have the right to freedom of testamentary disposition to leave her estate to whomever she wanted?

Mrs Ilott's father died before she was born and she spent the first 17 years of her life with her mother, Melita Jackson. When she turned 17, Mrs Ilott eloped with her boyfriend, whom she eventually married. Her actions caused a family fallout and the relationship with her mother broke down completely. They did not speak for 26 years. Mrs Jackson executed a will in 2002 whereby she excluded Mrs Ilott from benefiting from her estate and instead left the residue of her estate to three charities: the RSPCA, the RSPB and Blue Cross (with whom she had little connection). Mrs Jackson also signed a Letter of Wishes, which contained a direction that her executors fight any challenge to the terms of her will.

Mrs Jackson died in 2004, at the age of 70. Her estate was worth approximately ￡486,000.

Mrs Ilott first brought a successful claim against her mother's estate in 2007 whereby she was awarded a ￡50,000 inheritance by a District Judge who had concluded that she was “unreasonably excluded” by Mrs Jackson.

This ruling was then reversed on appeal, after various appeals on quantum, she was awarded sufficient funds to purchase a property and an additional capital sum. The Court of Appeal held that the effect of the original award of ￡50,000 was that she would lose her state benefits and would be in a worse financial position than prior to the award.

The decision of the Court of Appeal raised many issues. Should a mother be punished because she could not forgive her daughter’s actions? Is it right for a Judge to rule on the reasonableness of the decisions a mother made in highly emotive circumstances ?Should Judges deciding 1975 Act claims begin from the proposition that a mother is free to choose what to do with her estate on death unless there are compelling reasons to interfere, or from the proposition that a mother ought to leave something to her child unless there are objectively justifiable reasons not to? Should an estranged child be treated as being entitled to receive the same obligation as a dutiful child of 40 years? 

The Supreme Court has overturned the decision of the Court of Appeal which went too far. The court is not there to re-write a will because a disinherited adult believes that they should receive something or more than they have been awarded.

Although the court is still awarding a sum of ￡50,000 to Mrs Illot, it is making clear that this is an unusual case and it is on the facts of this case that the decision is made. Whether or not her mother’s actions were reasonable is not the main question. The main question is whether the outcome of the will makes reasonable financial provision in all of the circumstances. The estrangement was a significant factor to consider.

What does this mean for estates facing a claim by a disgruntled and disinherited adult child?

The fact is that a disgruntled and disinherited adult child has always had the ability to bring a claim under the 1975 Act, however limited to reasonable financial provision for his or her maintenance. If you have the ability to earn your own finances then you do not need maintenance.  

There is no doubt that this case will fuel some fires raised by disinherited adult children however the limit of the award and the specific facts of the case do help provide some guidance for solicitors when advising clients in these circumstances. Every case turns on its own facts. 

There has always been a concern following the original decision that if an adult child can demonstrate that they are impecunious, an award under the 1975 Act will follow. That concern was heightened by the Court of Appeal. However the Supreme Court has helped dispel that concern to a an extent. 

It has been stated that there may be a number of reasons for a creeping erosion of testamentary freedom. There is a substantially increased life expectancy, for a long period when children of the deceased are economically inactive. This may place a burden on the public purse if families are disinherited. Does this address the development of this area of law? The Supreme Court certainly addressed this concern in the supplemental judgment on that very point. The current state of the law does not give an answer as to how we deal with this. 

The decision does secure some guidance on how you determine what is reasonable financial provision, where a very much able bodied adult child has not been dependent upon their parents for many years. Assessing the amount of that provision is the burning question and the limit in this case does now assist with that and does make it difficult for an adult child to continue with a claim against an estate unless there are very specific circumstances.  

Although the decision does not change the law that you have freedom of testamentary disposition which allows you to disinherit estranged children, you do need to consider whether there will be an expensive battle about it once you are gone. No doubt if there is enough money left to argue about, then families may proceed to do so. The court has however made it clear that it is not there to alter someone’s will unless there are specific circumstances. Freedom of testamentary disposition is paramount. 

There is little doubt in my mind that this will still result in satellite litigation being embarked upon by adult children to try and get an award in their favour, by bringing nuisance action to get early settlement of something, even in the region of 10%, however the hope is that they will now receive the correct advice. 

As a mediator and a solicitor with 10 years’ experience of these claims, it is key that disputes of this nature consider mediation at the earliest opportunity. Legal costs can soon swamp the value of the estate over which everyone is fighting and the only winners will be lawyers. Mediating at an early stage allows the parties to engage with each other in a confidential and flexible environment, to allow each other's views be heard and if necessary heartache to be listened to. The reality, when faced with a claim, is that costs and emotions will run high and if litigation is pursued then they will only increase. Trying to nip these in the bud at an early stage is key to everyone moving on with their lives. On the flip side if one party is adamant that settlement is not possible then the only way forward is to let the courts impose a decision on them. 

I have experience of both ends of the scale and am happy to talk to anyone who is either looking for someone to advise them or looking for a mediator to act in an ongoing dispute.