Legal Background

The Inheritance (Provision for Family and Dependents) Act 1975 ("the Act") gives people who feel unfairly left out of a will a potential basis to challenge their lack of inheritance and, equally, can leave Executors of an Estate exposed to claims for that reason. The Act sets out certain categories of people that are able to make a claim against an estate for an order that they did not receive reasonable financial provision, including those who were dependent upon or maintained by the deceased. If a claim is successful, the Court determines what would constitute reasonable financial provision when making an award to a claimant.

The usual rule is that the costs of the claim are borne by the losing party. This excludes any success fee payable under a Conditional Fee Agreement (“CFA”), commonly known as a “no win no fee agreement”, which would be payable by a successful claimant, out of any sum awarded to them.

Re H (Deceased) 2020 background

In Re H (Deceased) 2020 the claimant was an adult child of the deceased who was described as suffering with a debilitating mental illness. She brought a claim against her late father's estate under the Act. The deceased had excluded the claimant from his Will and left his entire estate to his surviving spouse, the Claimant's mother.

The case was unusual for two reasons. Firstly, the claimant was not dependant on her father at the time of his death but she was ill and unable to maintain herself. Secondly her claim included a claim for the success fee recoverable under the CFA.

Outcome

The High Court judge deciding the case applied existing case law and held that the claimant had not been reasonably provided for but limited the claim to cover 3 years therapy and income and some element of her costs.

When considering the success fee element of the claim, the judge decided that if the Claimant had to pay the full success fee out of her award it would drastically reduce her entitlement and prevent her primary needs from being met. The judge therefore held that part of the success fee should be payable by the deceased's estate.

What this means?

Following the High Court's decision, it is likely we will see more future claims under the Act which include a claim for the success fee to be paid by the estate. If this case is to be applied, it is likely that a Court would allow some or all of the success fee to be paid by the estate in instances where the claimant would, otherwise, have to pay the success fee themselves. This would allow a claimant to keep a larger amount of the funds they need for their maintenance than they have been able to in the past.

The result could, as a result, be a big help to potential claimants, making it more practical and more financially worthwhile for them to bring a claim of this type. Hopefully, this will only serve to help claimants who may have previously felt unable to deal with their unfair situation. Sadly, it may also lead to more vexatious claims for Executors to deal with from more opportunistic claimants.

Get in touch today...

If you are a concerned Executor worried about a claim against you or someone who feels they have been unfairly left out of a Will, the Contentious Probate team at Gosschalks will be happy to help.

Key contacts: Ben Marsden and Alice Ashurst | Tel: 01482 324252