Most claims under the Inheritance Act are made against property and assets within the deceased person's estate. But what is the situation where the deceased owned joint property and assets have passed out of their estate under the survivorship principle?
In legal terms, there are two main ways in which joint property can be held. First, property can be owned jointly with one or more other people as 'tenants in common'. Each joint owner can leave their share of the jointly owned property to a beneficiary in their will. The other way in which property can be jointly owned is where the joint owners are 'joint' tenants. The big difference here is that on the death of one of the owners their share automatically transfers to the other. Lawyers refer to this as the survivorship principle.
It's vitally important to identify how joint property is owned, especially when dealing with inheritance and probate following a death. If joint property is owned as 'tenants in common' then the deceased's share will pass under their will. If the property is held as joint tenants it will pass by survivorship. This raises important issues for anyone considering a claim under the Inheritance (Provision for Family and Dependants) Act 1975.
Claims under the Inheritance Act are made against the estate of the deceased. However, if the deceased owned property as joint tenants their estate will not own the asset any longer, the asset having already passed to the surviving joint tenant. This can significantly reduce the monies available in relation to the claim and severely limit the estate's ability to provide reasonable financial provision. So what can be done when this type of situation arises?
Section 9 of the Inheritance Act 1975 deals specifically with property held on a joint tenancy. The Act allows such property to be taken into account, provided the Claimant makes an application to the court for an order under section 2 of the Act. This then empowers the court to make financial provision for the claimant by ordering that the deceased’s severable share of that property be treated as part of the net estate of the deceased "to such extent as appears to the court to be just in all the circumstances of the case."
Where such an order is made the value of the deceased's severable share is usually taken to be the value the share would have had at the date of the hearing of the application had the share been severed immediately before the deceased's death.
This is however a very complex area of law and this article is a highly simplified summary. There are also very strict time limits that apply. It's therefore vitally important that if this issue arises you seek immediate legal advice from a specialist firm of solicitors who are experinced in dealing with this field of law.
So, if you are contemplating an inheritance claim in an estate where the deceased held property jointly as a 'joint tenant' then please call our FREE helpline on 0808 139 15999 or email us at firstname.lastname@example.org