Can I choose who inherits my estate?

Most people believe that they have complete freedom to make a will leaving their estate to whomever they choose, even if that means cutting out a child or leaving everything to the dog’s home.

To some extent that is true, as unlike many other countries, citizens of England & Wales have the right to make a will in any terms they see fit, however, there are some circumstances within which your testamentary freedom can be eroded and the court can order that your estate should be distributed differently to how you intended.

Claims under the Inheritance (Provision for Family and Dependents) Act 1975

A claim can be made under this act by a person who believes that they have not been reasonably provided for in a will (or under the rules of intestacy if someone dies without a will) as long as they fall into one of the five classes of applicant;

1. Spouse/civil partner of the deceased;
2. Former spouse/civil partner of the deceased (who has not re-married and a claim has not been excluded under any financial order following divorce/dissolution);
3. Cohabitee of the deceased, having lived continuously together for a period of 2 years before death;
4. Child of the deceased (which includes any child legally adopted by the deceased and adult children); or
5. Dependant of the deceased (someone who, immediately before death, was maintained in whole or part by the deceased).

Claims are considered by the court on a case by case basis, taking into account the size of the estate, the current and future financial needs and resources of all the parties, and a final decision made as to whether an award should be made to a claimant or not.

If an award is made under this Act, it has the effect of altering the terms of the deceased’s will and may result in a person whom the deceased didn’t wish to inherit, receiving a share of the estate.

Steps can be taken to reduce the risk of a claim under the Inheritance Act being made;

1. Ensure that as part of any divorce/dissolution, a financial order is obtained which includes a provision that a claim cannot be brought under the Inheritance Act by your ex-spouse/civil partner;
2. Instead of leaving out a person from your will entirely, consider leaving them a small bequest, the payment of which is conditional upon a claim not being brought. This will not prevent a claim but will reduce the risk of a claim being brought as often the potential claimant thinks that they have “nothing to lose” if they have been left out entirely. If a conditional bequest is made, they do have something to lose and therefore may be less likely to bring a claim.
3. Make sure you have made a will and  if you are seeking to leave someone out entirely or are leaving them a smaller bequest than they might be expecting, also make sure that you have prepared a letter of wishes explaining the rationale. It is essential that a will and letter of wishes is prepared by a solicitor to ensure that the validity of the will cannot be challenged on the basis that it has not been drafted or executed correctly.
4. Discuss with your family your plans regarding your will. If your estate will not be distributed evenly, explain your reasoning to those who will be affected so that you manage expectations before your death. Doing so may well prevent disputes from arising following your death.

It is important to remember that any funds which would ordinarily pass outside of your estate, such as a property held as joint tenants or the proceeds of a life insurance or pension fund which is written into trust for nominated beneficiaries, are all treated as assets within the estate for the purposes of a claim under the Inheritance Act.

Claims under the principle of proprietary estoppel

The second claim which erodes a person’s testamentary freedom is an action brought under the principle of proprietary estoppel.

The principle of proprietary estoppel allows claimants who have been promised property (or other assets), to obtain a legal interest in that property, subject to the claimant satisfying the relevant criteria. Fundamentally the claim enforces the principle that in some circumstances, a promise is legally binding.

In order for a claim to be successful, the claimant must evidence three things;

1. That a promise has been made (which can also be a representation or assurance);
2. That the claimant has relied upon that promise; and
3. The claimant has suffered loss as a result of reasonably relying upon the promise.

As an example, if the deceased owned a farm and told one of their children that they would inherit the farm one day if they helped you run it, which they did for a number of years with low pay and long hours, and if the deceased then changed their mind and left the farm to another person in their will, a claim could be brought by the child who worked on the farm under the principle of proprietary estoppel. If the claim were successful an order could be made transferring all or part of the farm to the claimant, against the deceased’s wishes.

Avoiding a claim against your estate under the principle of proprietary estoppel is within your control to a greater extent than it is under an Inheritance Act claim. You need to ensure that you do not make any promises or create expectations that you are not sure you will fulfil. It is important to bear in mind that it is not just explicit promises which can result in a claim. Representations and assurances can be enough, particularly if they are repeated. Avoid making comments such as “everything will be yours one day” or “I will see you right in my will” etc as these can (in certain circumstances) be enough to give rise to a claim.

Finally, make sure you prepare a will which clearly addresses the issue of succession and discuss the same with your family members to ensure that there are no expectations which will not be fulfilled.

How can Geldards help?

If you find yourself concerned that a claim may be brought against your estate after your death and wish to take steps to minimise the chances of such a claim, if you wish to make a will or you find yourself involved in an estate dispute, please contact Laura Alliss who leads our contentious probate team and will be happy to help.