BWB’s Charity Legacies, Trusts & Probate Disputes team continues to be busy with a wide range of legacy-related matters. Highlights this month include a new instruction to defend a substantial charity legacy from a proprietary estoppel claim, and we have also just finished successfully negotiating the dismissal of an appeal against a judgment in our client’s favour, in a high profile charity trust dispute.
If you require any advice or assistance with any of your legacies, the team would be happy to hear from you. We offer a free initial ½ hour consultation.
Ilott v Mitson
Many of you will no doubt have been concerned to read the press surrounding the Court of Appeal decision in the long running case of Ilott v Mitson. The judgment has been seen as troubling, not least because of the Appeal Judges’ negative comments regarding charitable legacies.
Many in the sector have publicly commented on the case, including Remember A Charity, the Institute of Fundraising, and the Institute of Legacy Management. Leticia Jennings of BWB’s Charity Legacies, Trusts & Probate Disputes team commented on the case in both Third Sector and Civil Society.
Melita Jackson died in 2004 aged 70, leaving a net estate worth about £486,000. Other than a small cash gift, Mrs Jackson left her entire estate to 3 charities. Notably, Mrs Jackson did not make provision for her adult daughter, Heather Ilott, from whom Mrs Jackson had been estranged for almost 30 years. Mrs Jackson left clear, written reasons explaining why she had not included her daughter in her Will.
Nevertheless, and regardless of her mother’s testamentary wishes, Mrs Ilott brought a claim under the Inheritance (Provision for Family and Dependants) Act 1975, claiming that her mother’s Will did not make reasonable financial provision for Mrs Ilott’s maintenance.
This summer, after 8 years of litigation and numerous appeals, cross-appeals and court hearings, the case reached the Court of Appeal, where Mrs Ilott was awarded £143,000 (being the amount she needed to purchase her housing association home) plus £20,000 to produce a small income to supplement her already modest income. It could be inferred that the Court of Appeal found that the very limited resources of Mrs Ilott outweighed the right of Mrs Jackson to dispose of her estate as she intended.
Some commentators say the decision indicates that the Courts are more willing to interfere with the long established principle of testamentary freedom and to disregard the most cogent of testamentary wishes, even where the applicant had no expectation of receiving anything under the Will, as was the case here.
Others say that the law has been clear for a long time now, and that the Courts are able to alter a Will if reasonable financial provision has not been made for the maintenance of the deceased’s child.
Some commentators have criticised the decision and, in particular, the Appeal Judges’ comments in describing legacies to charities with which the deceased had no obvious connection as a “windfall”. Leticia Jennings described such comments as “surprising and disappointing for charities”, and what does seem clear is that it may now be more attractive for potential claimants to challenge a Will, which may lead to more disputes.
Will this impact on charitable legacies?
Ilott v Mitson has the potential to negatively impact legacies left to charities, and it will be interesting to see if the case opens the way to significantly more claims by adult children. However, charities, and those who wish to leave a gift to charity in their Will, should not be too disheartened. It is important to remember that this case does not fundamentally re-write the law and that it was decided on its very particular set of facts: an only child with no assets and a very modest income, a sizeable estate, and no other beneficiaries in “need”, as well as criticism of the deceased for her “unreasonable, capricious and harsh” behaviour towards Mrs Ilott. It is by no means certain that applications by family members in different circumstances would be successful.
Is there anything charities can do to improve their position?
If someone contacts your charity to discuss leaving a legacy in their Will, you should if possible seek to encourage them to discuss their intentions with close family and friends. The shock and disappointment of finding out a person has been excluded from a loved one’s Will is often a significant factor in deciding to bring a claim.
You should keep records (notes of conversations, letters, emails etc.) of all contact you have with donors, including details of any lifetime giving. Such contemporaneous evidence of a connection with your charity can be very useful if your legacy is ever challenged.
You should also encourage donors to consult an independent solicitor to draw up the Will, to avoid any criticism that you encouraged the donor to make the gift in your charity’s favour rather than it being of their own free will.
If you have any queries about the case, in particular over what it may mean for your charity’s legacies, we would be happy to hear from you.
Remember A Charity in your Will Week 2015
Remember A Charity in your Will Week is an annual awareness week designed to encourage more people to consider leaving a gift to charity when writing a Will. According to Remember A Charity, three quarters of Britons regularly give to charity in their lifetime, yet only 7% currently include a charity when writing a Will.
This year, Remember A Charity in your Will Week runs from 7th to 13th September. We are pleased to report that, for the fifth year running, BWB’s Charity Legacies, Trusts & Probate Disputes team is hosting its ever popular legacy seminar as part of Remember A Charity in your Will Week, in conjunction with Remember a Charity. The event aims to provide tips to charities on best practice when dealing with charitable legacies, and will be particularly useful for anyone who would like a good introduction to charitable legacies or those who would like a refresher in this area.
The event will include:
- An introduction to Remember A Charity, its work and the importance of legacies
- The charitable legacy market and the current threats and opportunities
- An introduction to charitable legacies, wills and probate as well as inheritance tax basics
- Best practice for legacy fundraising and avoiding problems with charitable legacies
- Presentation from a guest speaker who will present insights from a charity's perspective
We will finish with a well deserved afternoon tea for our guests.
If you or someone in your organisation would like to attend this seminar, please register your interest. This event is usually oversubscribed, so please book early to avoid disappointment!
We look forward to welcoming you.
Posted on 24/08/2015 in Legal UpdatesBack to Knowledge