In our previous blog, we discussed the position of minor children in bringing claims against the estate of a deceased person. Claims by children generally mean claims against the estate of the deceased’s child or a ‘child of the family’ e.g. stepchildren. This blog discusses the position of adult children, and how it differs from those of minor children.
In many ways, there are no differences between the requirements of a claim for a minor child, and the requirements of a claim by an adult child. There is no special category of applicant for a minor child (the only special category is a spouse or civil partner). Both claims are based on dependency or needs for their maintenance.
The major difference comes, of course, from a minor child’s ability to support themselves. The case law in cases involving adult children has had much commentary surrounding adult’s abilities to support themselves and to work if work is available to them. Minor children, of course, are not expected to get a job just because they have been left out of their parents will!
The case law before Ilott
In 2011, the case of Ilott v Mitzen which is widely considered to be a landmark decision for adults bringing 1975 Act claims against their parents’ estates, was heard. Prior to Ilott the position was quite different. The prevailing opinion appeared to be that set out in the case of Re Coventry. In that case the Court of Appeal said it was not enough for an applicant (in this case an adult child of the family) to simply show a financial need. The Court said that the adult was required to demonstrate something more to persuade the Court that it was unreasonable that greater provision was not made for them. Many interpreted this to be some sort of moral obligation on behalf of the parent to provide for the adult child.
The decision in Ilott
In the case of Ilott v Mitzen, the situation changed. The case of Ilott is very interesting. It involved three hearings, the first in the High Court, the second an appeal in the Court of Appeal, and the third an appeal in the Supreme Court. The main facts of the case are as follows:
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the deceased was a widow who died in 2004. At her death she was aged 70 and left a net estate of £486,000. She made some small gifts to individuals and then the entire residue estate to three charities.
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the deceased had one child. The applicant was in her 40s at the time her mother died and in her 50s by the time the case reached the Supreme Court. The daughter, Ms Ilott, had left home when she was 17 when she had been dating a man of whom her mother strongly disapproved. This led to a lifelong estrangement between mother and daughter. The daughter later married the man of whom her mother had so greatly disapproved, and went on to have 5 children of her own. She did not work, and her husband worked only part time. 75% of their income came from state benefits, and they had very little financial wealth for themselves. It is said that the daughter attempted to reconcile with her mother 3 times before her mother's death, and that none of these attempts resulted in any lasting reconciliation.
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the first judge found that the mother's Will did not make sufficient provision for the daughter and awarded her £50,000 from the estate (a figure of just over 10% of the net estate).
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Ms Ilott appealed this decision stating that she should have been awarded more than £50,000 and the charities who were the main beneficiaries of the estate cross-appealed.
The Court of Appeal decision
The main principles that came from the Court of Appeal decision are as follows:
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despite what previous case law suggests, there is no requirement that an adult child claimant must establish a moral obligation or special circumstance warranting payment from her parent’s estate;
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an child simply being in need of money may not be of themselves a reason to alter the deceased's wishes; and
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the ability of the applicant to earn a living for themselves is a significant factor in whether the Court will exercise its discretion to provide them with provision from the estate.
The Court of Appeal were mindful of Ms Ilott’s contention that £50,000 was not sufficient because it would deprive her of her means-tested state benefits but would not provide her with sufficient funds to purchase the property in which she was living, which was owned by a housing association. The Court of Appeal judge awarded her £143,000 which would allow her to buy her home and an additional £20,000 for additional income.
The Supreme Court decision
The residue beneficiary charities appealed this decision to the Supreme Court. Unfortunately for Ms Ilott, the court reinstated her original £50,000 award. One also has to wonder what her costs are of these three court claims, and can only imagine they were significantly more than the £50,000 award if not more than the net estate itself.
The Supreme Court decided that the Court of Appeal had no jurisdiction to interfere with the decision of the first judge. That was a value judgement based on the information that the judge had before him, and he had the authority to make the decision that he did based on the evidence available.
Do adult children need to provide a moral obligation for their parent to maintain them?
The Supreme Court made a finding that an adult claimant does have to prove an additional something in order to achieve a successful outcome. The Supreme Court accepted that in many cases this will be a moral claim.
This is perhaps where the position of minor and adult children will divest. In the case of a minor child cut out of a parent’s will, whether by happenstance, accident, or on purpose, most people would agree that adults have a moral obligation to care for their minor children and provide for them financially. Most would not agree that parents obligation to provide for their children goes beyond their childhood. This is particularly the case of Ms Ilott, who had been estranged from her mother for more than 20 years prior to her mother's death. It may have been a very different decision had the two remained close, and Ms Ilott been financially supported by her mother in some way.
Claimants on means-tested benefits
One of the other factors that was considered at great length by the Supreme Court was the impact of any award on Ms Ilott’s benefits. Having savings of more than £16,000 would deprived Ms Ilott of means-tested benefits, and potentially mean that she was worse off in the long run.
It is significant that the Supreme Court expressed no concern whatsoever about awards being formulated in a benefit or tax-efficient way. This is perhaps a warning to claimants about the benefits of settling claims out of court where consideration such as tax efficiency can be taken into account, as these are factors with which the Court will normally not concern itself.
Impact for applicants
For applicants, adult children will need to be careful to show something other than simply financial need in order to bring a claim against a parent's estate for reasonable provision. They must remain mindful at all times of the additional something that is needed to achieve a successful claim, either a financial dependency or a moral obligation on the parent to provide for them.
For testators, cutting out children, even adults children who may be capable of supporting themselves, does not come without its risks. It is imperative that you discuss with your solicitor when preparing your will if you have any children that you are not including, and the reasons why. A well drafted a letter of wishes, or perhaps a small payment to Ms Ilott may have been enough to have prevented a decade’s worth of very expensive litigation about an estate which is not, in the grand scheme of things, that large.
Should you have queries about 1975 Act claims, please contact Charlotte Braham by email or on 01494 893529.