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It is interesting to look at the very different outcomes in two recent decisions under the IPFDA which considered and applied the Supreme Court ruling in Illott v Blue Cross issued in March of this year.
In Ball v Ball (2 August 2017, EWHC 1750) a claim by three adult child applicants against their late mother’s estate (itself worth approximately £160,000) failed entirely.
Conversely, in Nahajec v Fowle (18 July 2016, EW Misc. 11) the applicant, an independent adult daughter aged 31, was awarded £30,000, which represented approximately 11% of an estate worth £260,000.
Both cases involved long-term estrangement between the testator and the applicant adult child/children, and both involved both applicants and respondents who were not particularly well off.
Ball v Ball the testator and her husband (who predeceased her) had 11 children. In the early 1990s three of the children (the applicants) were cut out of their mother’s Will having pursued a police prosecution against their father for historic sexual abuse. The father admitted some offences against two of the three and received at that time a suspended prison sentence. The testator changed her Will as a result of these events to cut out the applicants. Her other 8 children and one grandchild benefitted from her estate to the exclusion of the three. The applicants’ case first sought a declaration that the mother’s Will was invalid due to lack of capacity and undue influence. Both of these claims failed. The former was based on the premise that the testator was suffering from a serious “mistake” so as to remove her testamentary capacity, or had reached false conclusions about the people she had cut out of her Will. This somewhat novel argument related to what the testator believed about the truth of the sexual abuse allegations. In any event it failed: a Will cannot be invalidated on the basis of mistake as such, outside the doctrine of want of knowledge and approval (which it was accepted the evidence did not support). Undue influence arguments (which also failed) were based on the question of the testator’s husband having unduly influenced her to make the Will. All of this left the Court to consider the claims of the three applicants under the Inheritance (Provision for Family and Dependants) Act 1975.
In the Judgment HJJ Paul Matthews considered the Supreme Court Judgment in Illott v Blue Cross and its confirmation that as per long established caselaw in Re Coventry there did not need to be a “moral claim” as such, but that there most likely needed to be “something else” other in addition to financial need.
The Court focussed on the estrangement between the testator and the applicants, and upon the financial needs and resources of the three applicants on the one hand, and the 9 beneficiaries who benefitted from the Will on the other hand. It was important to remember that this was a modest estate of approximately £160,000 which already fell to be divided between 8 other adult children, and one grandchild. The Court considered that the sexual abuse itself was not “something other” for these purposes. That may have been the case had it been perpetrated by the testator. It had not, and she had not known of it, or condoned it. The estrangement in the family related to the way the matter was dealt with and the aftermath of family breakdown in sad circumstances. The estrangement was not necessarily solely the fault of the testator.
As to financial need, on the evidence none of the applicants was well off, but none of them were significantly in debt. However, none of them were significantly worse off than the 9 beneficiaries and they were not in need of further income for their reasonable maintenance. Some of the 9 beneficiaries, indeed, were worse off. The Court found that by the Will, the deceased had not failed to make “reasonable financial provision” and no award was made.
In Nahajec v Fowle the deceased testator had cut himself off from his children of both his first and second marriages when those relationships ended in divorce. The applicant, Elena Nahajec, was a 31 year old daughter of the second marriage. In a reflection of the times, she was in debt including on “pay-day” loans and she worked two jobs including on a “zero hours” contract. During a recent (cancer-related) health scare, she had been unable to work and so received no pay increasing her debts. Elena was on tax credits due to her low income. She aspired to return to education and retrain as a veterinary nurse which she had taken some steps towards. The testator by his Will left his whole estate to a male lifelong friend, Stephen, who was married and had a struggling company. Stephen saw the deceased regularly and took him to medical appointments. The deceased had left a letter of wishes to Stephen (who was also his executor) which stated that he had had no relationship with his children for 18 years, did not consider that they were concerned about his welfare, and said that they were not in any particular financial need. The evidence found that the deceased had been primarily responsible for the absence of a relationship with Elena: he had cut off contact after he left home, and even failed to acknowledge letters and cards that she sent to him as a child. When she became an adult she had tried to rekindle a relationship with her father, and there was some relationship between 2007 and 2009 but this ceased at the deceased’s instigation as he did not like Elena’s boyfriend and he cut off contact again. She made a further attempt to reach out to him when her mother died in 2012 which was somewhat cruelly rebuffed by the deceased. The applicant’s half-brother Philip, a son of the deceased’s first marriage, did not make any claim against the estate but his evidence supported the applicant’s version of events in relation to the estrangement, and his own experience and relationship with his father reflected a very similar pattern of behaviour on the part of the deceased. A second son from the deceased’s first marriage, Mark, had received an award (by agreement) of £22,000 from the estate based upon needs arising from his disabilities.
The applicant Elena was in straitened circumstances, on low wages and with debts and she would need resources to fund her studies. Stephen was in debt, he supported his wife who did not work. He had, he said, some health problems which affected his working life (but no evidence was provided), and he had complex financial circumstances, seemingly running his personal finances in part through his company which was in some difficulty. He had, however, passed over £200,000 of the estate through his hands since the deceased’s death, despite being aware of the claims, and including paying £13,000 for his wedding and over £18,000 for two Rolex watches for himself and his wife.
The Judge commented, that, following Illott v Blue Cross, the fundamental question that the Court must ask itself regarding the applicant’s claim “is not whether the deceased’s decision was unreasonable, but whether the disposition arising as a result of those decisions had produced an unreasonable result.” Looking at the applicant’s finances and needs for maintenance in detail the Court then made an award of £30,000 for her based upon capitalisation of what it found was actually needed for her maintenance. She had sought £70,000, which when various figures were examined/adjusted equated to £59,000. As above, Mark was to receive £22,000.
Some interesting observations were made by the Judge in making that award.
First, that his hands were “tied” in terms of capitalising what was required for maintenance.
Second, that he acknowledged that some judges would have awarded more, some may have awarded less (echoing the probable result of Illott v Blue Cross that a first instance judge’s decision is unlikely to be interfered with on appeal.
Third, even though Stephen had largely “spent” the estate, which he had distributed to himself, the Order would be no different: he had unjustifiably dissipated the estate in knowledge of the claim.
Finally, and by what appears to be as a result of coincidence, but is nevertheless interesting, the award amounted, as the judge observed, to approximately 11% of the total estate whereas in Ilott, where the estate was 45% bigger, overall, the award made at first instance and ultimately upheld by the Supreme Court, was approximately 10% of the estate.
These two cases, which despite superficial similarities of estrangement and financially straitened circumstances, are a reminder that although clarity has been provided to an extent by the Supreme Court the outcomes in adult child claims, these will still fall upon the particular facts and evidence in each case.