Inheritance dispute lawyer, Naomi Ireson, reviews the Inheritance and Trustees’ Powers Act 2014
Please note that the figures referred to in this article have changed since it was first published. For up-to-date guidance on this specialist area of law contact our free helpline by phone or email.
REFORMS TO INHERITANCE (PROVISION FOR FAMILY AND DEPENDANTS) ACT 1975 CLAIMS
The Act includes the following changes to inheritance dispute claims:
- Inheritance Act claims can now be commenced before a Grant of Representation has been issued. This will assist where personal representatives delay obtaining a Grant in order to avoid or delay court proceedings being issued. It also avoids the need to apply for a citation to force personal representatives to apply for the Grant, thereby saving unnecessary legal costs and preventing delay.
- Applications under s9 of the Inheritance Act (a provision that allows the deceased’s severable share of a property held under a joint tenancy to be treated as part of their estate) can now be brought outside of the Act’s six month time limit at the court’s discretion. Previously, the court did not have the power to extend time under s9, even if it wanted to.
- Inheritance Act claims made under section 1(1) (d) (claims by a “child of the family”) will include anyone who was treated by the deceased as a child of the family, not just in relation to a marriage (or a civil partnership) but in relation to “any family” in which the deceased had a parental role. Nevertheless the relationship between the deceased and the claimant must still be akin to that of parent and child. This change will make it easier for grandchildren to bring an Inheritance Act claim against their grandparents’ estate, where those grandparents raised the child.
- Inheritance claims made under section 1(1) (d) will now also include single parent families.
- Claimants who have been maintained by the deceased (pursuant to section 1(1) (e)) will benefit from the removal of the “balance sheet” assessment. At present they would have to show that the deceased contributed more than the applicant did in order to prove they had been maintained by the deceased. The amended section 1 (3) will require the applicant to simply establish that the deceased had been making a substantial contribution towards their reasonable needs. Contributions made between people within a domestic context will no longer be weighed against one another.
- The “deemed divorce test” has been amended. Under subsection 3 (2) the court must have regard to the likely level of provision that might have been made during any ancillary relief proceedings following a notional divorce. Courts will now have regard to:
i) whether the deceased maintained the claimant,
ii) the length of that maintenance,
iii) the basis on which maintenance was provided and
iv) the extent of the maintenance contributed. - Under the new section 3(4) (a), a judge must look at the basis of the maintenance and the extent of the contribution for claims made under section 1(1) (e).
CHANGES TO THE INTESTACY RULES
The intestacy rules determine how an estate should be distributed where the deceased doesn’t leave a Will. Here is a brief overview of these long awaited changes:
- If a person dies without a Will leaving a spouse (or civil partner) but no issue, their estate will now pass to their spouse (or civil partner) in full. Under the old intestacy rules, parents or siblings have an interest where the estate has a value in excess of 450,000.
- If a person dies without a will leaving either a spouse (or civil partner) and issue, the surviving spouse will inherit the first £250,000 with the balance being split equally between the spouse absolutely and the issue. Under the old intestacy rules, the spouse only received a life interest in half the remainder, so this change is good news for spouses.
- A surviving spouse will be entitled to the deceased’s personal chattels absolutely. The definition has been amended to include tangible moveable property. The exceptions to this is property:-
(a) consisting of money or securities for money,
(b) used at the death of the intestate solely for business purposes,
(c) held at the death of the intestate solely as an investment. - Where a person dies intestate and their parents were not married at the time of their birth it is no longer presumed that the father died before the intestate, providing the father was named on the deceased’s birth certificate (or the equivalent official birth record).
CONCLUSIONS
While we welcome these changes there is an underlying concern that the reforms do not go far enough to take account of the changing circumstances of modern family structures in 21st century England and Wales.
Both the rules of intestacy and family provision under the Inheritance Act continue to be out of step with what is happening in society at large. The reforms fail to fully recognise that many couples prefer to co-habit and have children without marrying. These families in particular will continue to suffer injustice under the new regime. Our current advice to people about the need to have a valid Will therefore remains the same. This is particularly critical for people who cohabit and have children without marrying. The Inheritance (Cohabitants) Bill is eagerly awaited to see whether further reforms will be forthcoming.
For guidance on bringing an Inheritance Act claim and details of our No Win, No Fee funding option, call us on 0333 888 0407