Unhappy families – challenging inheritance issues

The outcome of a recent High Court case is a warning for anyone challenging a will.

As inheritances become more valuable, the number of disputes about wills have increased. Court cases rose by almost 50% to 188 in 2019 compared to the previous year according to the latest Ministry of Justice figures. Many more are settled or abandoned along the way. The cases which do reach the High Court tend to be those involving the ‘right’ mix of large sums and elevated emotions. An example that appeared in April 2021 is Miles v Shearer.

Tony Shearer died in October 2017, leaving nearly all of an estate worth about £2.2 million to his second wife, Pamela. His two daughters, Juliet and Lauretta, born in the early 1980s to his first wife, received nothing. This prompted them to make a claim under the Inheritance (Provision for Family and Dependants) Act 1975.

Lauretta wanted a payment from her father’s estate to cover:

· The cost of a home, so that she could move out of her mother’s property;

· Fees for training as a dog behaviourist, to enable her to support herself; and

· The expenses of caring for her autistic daughter.

Juliet sought funds to:

· Reduce her mortgage by about £245,000, so that it would become affordable for her on a repayment basis: and

· Buy out her ex-husband’s share of a flat in which she was living – about another £100,000.

In 2008, shortly after his divorce, Tony gave £177,000 to Juliet and £185,000 to Lauretta. At the time he made clear there would be no further financial support to his daughters. This was an important factor in the case as it reinforced the decisions Tony made in the creation of his will.

The judge rejected the claims of both daughters, stating that neither had established a need for maintenance to be funded from their father’s estate. Two lessons can be drawn from the case:

· Make your intentions clear in advance to try to reduce potential disappointment and the likelihood of legal action when a will is finally read.

· Tony’s will achieved what he wanted to happen. Had he left matters to English intestacy laws, Pamela would have received only £125,000 and personal chattels outright, with Juliet and Lauretta immediately jointly receiving half the residue (less about £285,000 of inheritance tax).

The law in Scotland is different from England and Wales, and we have different intestacy rules and procedures, however, the main premise still applies: make sure your will is up to date and your intentions towards potential beneficiaries are clear, especially if the contents could be contested.

Find out more about Inheritance tax and how it affects you and your family.