15-03-17

Supreme Court rules in Ilott v. Mitson

Much has been made of the case of Ilott v. Mitson but ten years of litigation came to an end today in the UK’s highest court.  Indeed, it was the first time the Supreme Court had been asked to consider a case brought under the Inheritance (Provision for Family and Dependants) Act 1975 (“the Inheritance Act”) and, as a result, we have seen the pendulum swing back in favour of freedom to dispose of our assets to whom we choose.  Whilst this principle prevails – known as “testamentary freedom” – in contrast to many jurisdictions which have rules about “forced heirship”, the law continues to recognise the need for certain persons, under the Inheritance Act, to be able to apply to court for reasonable provision if such provision has not been made for them.

Inheritance Act

The Inheritance Act sets out who is entitled to make an application for reasonable provision.  Those eligible include spouses, children and those maintained immediately before death.  In order to secure provision from a deceased's estate, the applicant must persuade the court that the will (or intestacy rules, where there is no will) does not make "reasonable provision" for him or her. If the applicant is not a spouse or a civil partner then he or she is only entitled to apply for such provision as is necessary for his or her “maintenance". 

If the court concludes that the will does not make reasonable provision for the applicant, the court must then consider what provision to make, having regard to a number of factors including the financial needs and resources of the applicant; the family resources and needs of any other family members or beneficiaries of the will; the size of the deceased's estate; and any obligations or responsibilities owed by the deceased to the applicant. The court may also take into account any other matter which in the circumstances it considers relevant, including the deceased's testamentary wishes (which will usually be recorded in the will or letters of wishes).

Ilott v. Mitson shines a light on judicial interpretation of these factors.

Brief facts

  • The will-maker, Mrs Jackson, was widowed after only four years of marriage and when expecting her only child, a daughter, Heather Ilott.  In 1978, when Mrs Ilott was 17, she left home secretly to live with her boyfriend, of whom Mrs Jackson did not approve. There followed a lifelong estrangement between mother and daughter which lasted 26 years until Mrs Jackson’s death at the age of 70.  Mrs Ilott and her husband had five children. Mrs Ilott did not work and the family survived largely on state benefits and tax credits. As a result of the family's “straitened circumstances” Mrs Ilott had never been on holiday, had difficulty affording clothes for her children and was limited in the food she could buy. 

     

  • Mrs Jackson left her entire residuary estate to three animal charities, adamant her only child should receive nothing.  Indeed, Mrs Jackson left two “letters of wishes” explaining why she had left nothing to Mrs Ilott and instructing her executors to defend any proceedings brought by her against the estate.

     

  • Mrs Jackson died in June 2004 leaving a net estate of £486,000, and Mrs Ilott issued a claim for reasonable provision under the Inheritance Act.

Journey to the Supreme Court  

  • 2007: the case was first tried and Mrs Ilott was awarded £50,000 as being capitalised reasonable maintenance.

     

  • 2009: the charities appealed the decision and Mrs Ilott cross-appealed the level of the provision.  The High Court decided in favour of the charities.

     

  • 2011: Mrs Ilott appealed to the Court of Appeal which found in her favour and remitted the case to another judge to determine appeal on quantum.

     

  • 2013: the appeal was dismissed and the original 2007 decision reinstated.

     

  • 2015: the Court of Appeal once again hears Mrs Ilott’s appeal which it allowed, ordering provision to be set at £143,000 for property acquisition and £20,000 for investment.

     

  • 2016: the charities appeal to the Supreme Court and judgement on 15 March 2017 is unanimously in their favour with the 2007 decision being reinstated. 

Ilott v. Mitson highlights that it is prudent to consider the likelihood or otherwise of an application under the Inheritance Act being brought.  Whilst they can never be excluded entirely, certain steps can be taken to ensure an application is discouraged or, at least, limited in its success.   

For more information please contact Andrew Kidd (akidd@clintons.co.uk).

 

 


Article by Andrew Kidd