A Will is a document, made by someone, which sets out how their estate should be distributed on their death and who should deal with the administration. However, recent research carried out by Prudential found that around 60% of the UK population does not have a Will.
If someone dies without a Will, their estate passes under the intestacy rules. Most people assume that if they are married everything Will pass to their spouse. This is not the case however if you have children and the value of the estate exceeds £250,000 (in which case the spouse only receives the first £250,000 of your estate and half of the remainder outright). The average house price in Buckinghamshire was £413,000 at the start of 2018, considerably higher than the £250,000 threshold. The intestacy rules become far more complex if an individual is unmarried or does not have children. There is no such thing as a “common law marriage” in the UK. As a result, long-term partners have no rights under the intestacy rules and would need to bring a claim through the courts in order to receive any benefit from an estate. This is a concerning thought when you consider that 10% of the adult UK population live together as unmarried couples.
In order to avoid this, we would always advise clients to make a Will. But what happens if someone has not made a Will and then loses mental capacity?
The law states that, in order to make a Will, an individual must understand the nature of the act (i.e. that they are making a Will), recall the extent of their property and give consideration to any claims that a person making a Will ought to consider. Case law further states that the person should not be suffering from any disorder of the mind. This means that someone who is suffering from Alzheimer’s or Dementia may be unable to make a Will, particularly if they are unable to recall their assets or details of family members.
In these cases it is possible to make an application to the Court of Protection for a Statutory Will. This is a Will that is drawn up on behalf of someone who lacks the capacity to make a Will. The overarching consideration for the Court of Protection is that making the Will must be in the person’s best interests. The process of preparing a Statutory Will includes consulting with anyone who may be entitled either under an existing Will or under the rules of intestacy. The Official Solicitor will usually be appointed by the Court to act as an independent party and to ensure that any Will that is drawn up is in the person’s best interests. Because of the involved nature of this type of application, it is highly unusual for Statutory Wills to be challenged, as any party who could bring a claim will usually be involved in the process (even if they do not benefit from the Will).
Statutory Wills are appropriate in a variety of scenarios, including if someone is unmarried, or has children from multiple marriages/relationships, or where a Will that was previously drawn up does not make provision for particular person. The Court of Protection has also indicated that they will consider Statutory Wills which are made for tax planning purposes, although careful consideration needs to be given in these cases as to whether the same result can be achieved by a later Deed of Variation of the Will.
Applications for the preparation of Statutory Wills are time consuming and require a significant amount of paperwork, however this is usually justifiable when compared to the potential cost and conflict created if a person has not left a Will or their current Will creates a clear conflict that they may not have intended.
If you believe a friend or relative of yours might benefit from a Statutory Will, or you have any questions generally about the Court of Protection, please contact our resident expert Ashley Minott on 01494 893518 or by email for further advice.