Claims by Family and Dependants

Claims for Reasonable Financial Provision from an Estate

Individuals who are not adequately provided for under the terms of a will or by the intestacy rules can bring claims for provision from the estate.

Claims can be brought under the Inheritance (Provision for Family and Dependants) Act 1975 for a ‘reasonable financial provision’.

It is for the person making the claim to prove that they require reasonable financial provision.

Claims of this type are rarely straightforward and, if an executor / personal representative, deals with the claim incorrectly there is a real risk of personal liability to the beneficiaries of the estate.

Legal advice should be taken on any claims notified to an executor / personal representative at the earliest opportunity.

Usually the legal costs incurred by an executor / personal representative in responding to a claim can be paid out of the estate.

What Estate assets are subject to the claim?

The claim is made against the net estate before distributions are made by executors/personal representatives.

This does not include any assets that have passed by survivorship such as the contents of jointly held bank accounts with a spouse of civil partner or a home owned as joint tenants.

If appropriate, an applicant can apply to the Court for an order that the estate include assets that would otherwise pass by survivorship.

Who can make a claim for reasonable financial provision?

Different standards of provision will apply to people who are dependent on the deceased and a spouse/civil partner:-

  1. Spouse/civil partner (or former spouse/ former civil partner who has not formed a subsequent marriage) civil partnership; the financial provision required for spouses/civil partners is what it is reasonable for them to receive whether it is for their maintenance or not. Some former spouses/civil partners and spouses from polygamous marriages can also bring a claim.
  1. Partners of the deceased who have resided with the deceased for a period of 2 years will also potentially be able to make claim to financial provision as though they were a spouse/civil partner.
  1. Children (or individuals treated as a children) and anyone maintained (either wholly or partly) before death. They are entitled to reasonable financial provision for maintenance

What if the will explains why someone should not benefit from the estate or the deceased’s wishes were clear? 

The wishes of the deceased will not directly affect whether a spouse, civil partner or dependant has a claim for reasonable financial provision against the estate.

If a reasonable provision results from a will the Act cannot be used to challenge the way the deceased decided to leave their estate.

The reasons for the deceased’s wishes may still be a relevant factor in a claim if the reasons stem from the applicant’s conduct.

Claims by Spouses/Civil Partners

The right to reasonable financial provision is broader than a claim to maintenance from the estate.

The length of a marriage / civil partnership is relevant to a claim.  If the marriage/civil partnership was short, the length of the relationship prior to marriage / civil partnership is also relevant.

For claims by former spouses/civil partners an order of the Court ending a marriage/civil partnership might possibly contain a provision barring claims under the Inheritance (Provision for Family and Dependants) Act 1975

If a court is required to decide whether there is reasonable financial provision it will consider living standards during the life of the deceased

If there is already a reasonable financial provision a claim will fail.

Claims by Children or Dependants – What is the standard of Maintenance?

The Act sets out a test for:-

such financial provision as it would be reasonable in all the circumstances of the case for the applicant to receive for his maintenance

The Courts have interpreted maintenance to mean a level that would be reasonable for the applicant to live on, but not luxurious at one end of the spectrum or poverty-stricken at the other.

There have been a lot of cases that interpret the meaning of maintenance in circumstances that differ from case to case.

If a court is required to decide whether there is reasonable financial provision it will consider living standards during the life of the deceased

If there is already a reasonable financial provision a claim will fail.

Claims by cohabitees.

It is often difficult to assess the contributions made by cohabitees to a relationship (for example payment of living expenses).  Nevertheless this is an exercise that the Court may be required to undertake.

When must a claim be issued at Court?

The claim must be commenced by completing and issuing a claim form at Court together with supporting witness evidence.

The claim must be commenced within six months of the grant of probate or letters of administration.  In certain circumstances the Court has a discretion to permit claims commenced after this deadline but cannot be guaranteed.

It is presently unclear whether the commencement of a claim has to wait for a grant of probate or letters of administration.

The deceased must have resided in England and Wales at the time of their death to enable a claim to be brought in England and Wales.

Different laws apply to Scotland and Northern Ireland which are beyond the scope of this website.

Evidence required in any claim

The full and frank details of an applicant’s means and financial obligations is the key evidence in any claim.  This evidence must be served on the executor/personal representative when the claim is served on them,

The executors/personal representatives are not obliged to prepare evidence of their own financial means in response to a claim but this might be relevant.  For example, the executors/personal representatives may be entitled to distribution from the estate and may have a defence that they have a competing need for that distribution.

The executors/personal representatives must disclose detailed evidence of the net estate in response to any claim for reasonable financial provision.

The Act does not provide for assets outside an estate being used to benefit an applicant but, if this happens, then it may affect an applicant’s prospects of succeeding in their claim

Factors to be considered on any claim

Assuming that a need for reasonable financial provision is shown the Court will need to consider various factors to decide whether to make an award

These factors are considered at the date of hearing and the Court will give equal weight to each one.

The general factors to be considered on any claim are:-

  1. the financial resources and financial needs which the applicant has, or is likely to have, in the foreseeable future;
  1. the financial resources and financial needs which any other applicant has or is likely to have in the foreseeable future;
  1. the financial resources and financial needs which any beneficiary of the estate has, or is likely to have, in the foreseeable future;
  1. any obligations and responsibilities which the deceased had towards any applicant or towards any beneficiary of their estate;
  1. the size and nature of the net estate;
  1. any physical or mental disability of any applicant any beneficiary of the estate;
  1. any other matter, including the conduct of the applicant or any other person, which the court may consider relevant;

For spouse/civil partner applicants the Court will also consider:-

  1. the age of the applicant and the duration of the marriage/ civil partnership;
  1. the contribution made by the applicant to the welfare of the family, including any contribution made by looking after the home or caring for family
  1. the provision which the applicant might reasonably have expected to receive if there has been a divorce or dissolution order at the date of death.

For child applicants the Court will also consider:-

  1. the manner in which the applicant was or might expect to be educated or trained,
  1. for individuals treated as children by the deceased – whether responsibility for the applicant’s maintenance had been assumed. If it had, then:-
    1. the basis for assuming responsibility;
    2. the extent of the assumed responsibility
    3. the length of time the assumed responsibility had been discharged.
    4. Whether the deceased was aware that the applicant was not his child;
    5. Liability of any other person to maintain the applicant.

For dependant applicants the Court also consider:

  1. Whether responsibility for the applicant’s maintenance had been assumed. If it had, then:-
    1. the basis for assuming responsibility;
    2. the extent of the assumed responsibility;
    3. the length of time the assumed responsibility had been discharged.

What could a Court award if a claim is successful?

The Court has a wide discretion to award a number of different things to a successful applicant depending on their needs.  These include:-

  1. A capital sum (to be paid to the applicant or to be held on trust for their benefit).
  1. Income from investments
  1. A number of deferred payments.
  1. A life interest in estate assets

What is likely to be awarded?

The level of any award will depend on the standard that applies to the claim.  Is it a claim for maintenance by a dependant or a claim by a spouse/civil partner for reasonable financial provision?

All of the factors we have mentioned are relevant to any award made by the Court.  It is difficult to provide guidance on how these factors will affect an award without applying them to the facts of any individual case.

If a claim is from a spouse/civil partner it should be considered whether there should be a ‘clean break’ i.e. a lump sum to be paid to the spouse/civil partner.

Alternative Dispute Resolution

There are many types of alternative dispute resolution including settlement meetings between the parties and mediation.

Mediation is a process where an independent third party is provided with information and documents about the claim and tries to help the parties reach an agreement on the claim without the need for the Court to determine the claim.

A mediator will not pick a side or decide the claim.

Although mediation is a voluntary process the Courts can penalise parties in costs if they unreasonably refuse to participate in a mediation.

The vast majority of claims for reasonable financial provision are suitable for mediation.

Resolution of a claim by mediation is likely to be much quicker and much cheaper than having a claim determined by the Court.

If agreement cannot be reached at a mediation then the parties can still have the claim determined by the Court.  Negotiations at a mediation cannot be disclosed to the Court when the Court is determining the claim.

The voluntary Association of Contentious Trusts and Probate Solicitors code for contentious probate litigation provides that where the parties will endeavour at an early stage of the matter to have a without prejudice meeting to explore the possibility of the matter being resolved without the necessity for formal protracted and potentially acrimonious Court proceedings.

Who pays the costs of any claim?

Generally, speaking the loser pays the winner’s costs although the Court does have a wide discretion on costs.

Usually, the legal costs incurred by an executor / personal representative in responding to a claim can be paid out of the estate.

Offers can be made within any proceedings that may affect liability for costs following a trial.