ACCORDING to a recent report in the Financial Times, 663 Wills were disputed last year, which was around twice as many as in 2006.
The major causes is believed to be the increased financial hardship that many people are currently suffering due to the economic downturn, more complex family structures (as the number of people getting divorced continues to rise) and the increasing number of adult children acting as carers who feel that they should be better provided for on the death of the person for whom they were caring.
When can a Will be challenged? Two reasons for challenging a Will are if either the Will is invalid or someone feels that they have not been adequately provided for
The main circumstances when a Will won’t be valid are if it was not executed properly (e.g. not signed and witnessed), the testator (the person making the Will) was mentally incapable or it was made under undue pressure from another person.
Even if a Will was valid when it was written, it will be automatically revoked if the testator gets married, destroys their Will or makes another Will. Getting divorced also cancels any benefits to a former spouse unless the wording clearly states that divorce should not affect the former spouse’s entitlement.
As a general rule a testator is entitled to leave their estate to whomever they wish, but if the Will fails to make “reasonable financial provision” for certain classes of people, the Court has the power, under the Inheritance (Provision for Family and Dependants) Act 1975, to ensure that they are provided for.
There are essentially six categories of people who can contest a Will under the Act – a wife or husband of the deceased, a former wife or husband of the deceased who hasn’t remarried, children of the deceased, step-children of the deceased, a partner who lived with the deceased for at least the last two years immediately prior to their death and any other person who immediately before death was being maintained, either wholly or partly, by the deceased.
If you think you have grounds for complaint, then it is important to move quickly, preferably before probate is granted (which is the point from which the estate can start to be distributed unless a caveat is granted which stops the assets from being distributed), and in any event normally no later than six months after grant of probate.
The longer you take to lodge a challenge the weaker your case is likely to be, although if a caveat has been given, this lasts for six months and often leads to disputes being resolved between the affected parties before the court stage is reached and before any assets have been distributed.
However, it is important to note that legal action can slow down any inheritance and can be costly for all sides.
Once it has been determined that the applicant is entitled to bring an application, the key issue will be to determine what is deemed to be “reasonable financial provision” for that person based on the facts of the case, taking into account the size and nature of the estate and the relationship between the applicant and the deceased.
For example, if the applicant is a spouse of the deceased “reasonable financial provision” means such financial provision as would be reasonable in all the circumstances of the case for a husband or wife to receive, whether or not that provision is required for their maintenance.
For any other applicant, (including a former spouse or someone else who was financially dependent on the deceased when they died), ‘reasonable financial provision’ means such financial provision as would be reasonable in all the circumstances of the case to receive for their maintenance. In the case of a successful non-spouse claimant, therefore, and especially if the claimant is a financially dependent relative, it is more likely that the court would award maintenance payments, rather than a one-off lump sum.
In summary, it remains as important as ever to ensure you have a valid Will – and that you review it regularly to make sure it is up-to-date – because without one, the intestacy rules apply, which is likely to result in the estate not being distributed as you would have wanted and in some cases people you would have liked to benefit may not be entitled to receive anything at all.
It is also worth mentioning that, in certain circumstances, a suitably drafted Will can also help minimise any Inheritance Tax that may otherwise be charged on your estate. This doesn’t mean that your Will won’t be subject to challenge of course, but by ensuring it is properly executed and is updated as appropriate to reflect changing personal and family circumstances, the risk of this occurring should at least be minimised.
Please note that the Financial Services Authority does not regulate Will writing and taxation and trust advice.