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Recent developments 2014
LA3021 Company law
Current edition of the subject guide
The current edition of the subject guide is the 2009 edition.
The following developments should be noted
Essential reading
Primary textbook
Dignam, A. and J. Lowry Company law. Oxford: Oxford University
Press, 2012 seventh edition ISBN 9780199643226.
Updated references for this textbook are given at the end of this Recent
developments.
Other texts to consult
Dignam, A. Hicks and Goo’s cases and materials on company law.
Oxford: Oxford University Press, 2011 seventh edition ISBN
9780199564293.
Davies, P. And S. Worthington Gower and Davies Principles of
Modern Company Law. London: Sweet & Maxwell, 2012 ninth
edition ISBN 9780414022720.
Kershaw, D. Company law in context: Text and materials. Oxford:
Oxford University Press, 2012 second edition ISBN
9780199609321. This book places the study of company law in its
economic, business and social context. This makes the cases, statutes
and other forms of regulation that make up company law more
accessible and relevant.
Mayson, S., D. French and C. Ryan Mayson, French & Ryan on
company law. Oxford: Oxford University Press This book is revised
annually so the latest edition is always current. If you use this book,
make sure it is the latest edition. Check the Oxford University Press
website www.oup.co.uk for details.
Sealy, L. and S. Worthington Cases and materials in company law.
Oxford: Oxford University Press, 2013 tenth edition ISBN
9780199676446.
Company law reform
As from the 1 October 2009 the Companies Act 2006 is now fully in force.
It forms the single principal Companies Act for the UK.
In previous years, as there were two Companies Acts in operation, the
Chief Examiner had agreed that students could answer questions on the
examination paper using either the 1985 Act or the 2006 Act.
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As the 2006 Act is now fully in force, you must use this Act in your
examination answers.
You should also, as in previous years, be up to date with the company law
reform process, of which the 2006 Act forms a substantial part.
The law on company charges has been reformed. The Companies Act
2006 Amendment of Part 25 Regulations 2013 repeal ss.860–892 of
the Companies Act 2006. In their place, the Regulations insert new
s.859A–Q into the Act. The new provisions largely repeat the old
registration scheme, but with a more streamlined registration process.
One change of substance worth noting, however, is that a company’s
failure to register a charge is no longer a criminal offence.
The law on share buy‐backs has also been reformed and simplified. The
changes were introduced by the Companies Act 2006 Amendment of
Part 18 Regulations 2013. Under the new rules, a small buy‐back the
value of which does not exceed £15,000, or 5 per cent of the company’s
share capital if less can now be paid for out of capital, without the
company having to satisfy the complex procedures which ordinarily
apply to buy‐backs out of capital. At least, that was certainly the
Government’s intention, although unfortunately some doubts have been
expressed over whether the new rules achieve this result. Further, the
new rules make it easier for private companies to buy back their shares
as part of an employee share scheme. Finally, for both private and
public companies, off‐market buy‐backs can now be approved by an
ordinary resolution previously, a special resolution was required.
BIS has also consulted on proposals to simplify the ‘filing requirements’
for companies, as part of the UK Government’s broader policy of cutting
‘Red Tape’ on business by removing unnecessary regulatory burdens.
See www.gov.uk/government/consultations/company‐filingrequirements
On share capital reform see also:
www.bis.gov.uk/Consultations/companies‐act‐2006‐statements‐ofcapital‐
consultation?catclosedawaitingresponse
The UK’s Financial Services Authority FSA has now been replaced by two
new regulatory bodies. The first is the Prudential Regulation Authority
PRA, which is a subsidiary of the Bank of England, and is responsible for
promoting the stable and prudent operation of the financial system
through regulation of all deposit‐taking institutions, insurers and
investment banks.
The other regulatory body is the Financial Conduct Authority FCA. It is
responsible for regulation of conduct in retail, as well as wholesale,
financial markets and the infrastructure that supports those markets.
The FCA will also have responsibility for the prudential regulation of
firms that do not fall under the PRA’s scope.
See www.fsa.gov.uk/about/what/reg_reform/background
The FSA, prior to its replacement by the FCA, had already become more
active in pursuing insider dealing activities See:
www.fsa.gov.uk/pages/Library/Communication/PR/2010/052.shtml.
In March 2010, for example, the FSA coordinated raids involving 143
police officers and FSA investigators on the homes of senior employees
of financial services companies. Six arrests were made in what was
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described as the biggest ever crackdown on insider dealing. See:
www.guardian.co.uk/business/2010/mar/23/six‐arrested‐over‐insiderdealing
Finally, the Government has embarked on a much wider‐ranging
consultation into the transparency of ownership of companies and the
accountability of corporate directors. In July 2013, it issued a discussion
document entitled ‘Transparency and trust: enhancing the transparency
of UK company ownership and increasing trust in UK business’.
Suggested reforms included:
making it easier to identify the beneficial owners of company
shares
introducing greater transparency around ‘nominee directors’,
and possibly abolishing ‘corporate directors’
amending say by strengthening the statutory duties on
directors in some specific business sectors such as banking
amending the rules governing the disqualification of directors
including by extending the time limit for bringing proceedings
from two to five years in the case of insolvent companies.
As of Feburary 2014, the Government is still reflecting on the feedback it
has received from the public on its discussion document.
See: www.gov.uk/government/consultations/company‐ownershiptransparency‐
and‐trust‐discussion‐paper
Corporate governance reform
There have been a number of important initiatives taken in recent years
to address aspects of the corporate governance regime for larger,
especially quoted, companies.
The Walker Review
In November 2009 Sir David Walker unveiled his report on corporate
governance in the financial services industry. Having reviewed the
problems within the UK financial industry, he considered that:
a. the boards of big banks didn’t understand the scale of the risks
their organisations were running
b. non‐executive directors NEDs of big banks did too little to rein
in the excesses of the executive directors
c. shareholders in banks also failed to curb reckless gambling by
financial institutions, and that owners didn’t ‘exercise proper
stewardship’
d. that bankers were paid in a dangerous way which encouraged
them to speculate imprudently.
Walker suggested a number of changes to the governance regimes of
financial institutions. These included:
i. Financial institutions should form a risk committee, separate from
the audit committee, to monitor all substantial transactions and
stop the transaction if it was deemed too risky. The committee
should be chaired by a NED.
ii. Increase the training of NEDs, increase their oversight by the FSA
now the FCA, and increase the amount of time NEDs should be
expected to spend each year performing their duties.
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iii. Ensure that the Chairmen of financial institutions have significant
and relevant ‘financial industry experience’, face re‐election by
shareholders every year and devote two thirds of their time to the
company.
iv. Ensure greater rigour and transparency in setting the
remuneration of ‘high end’ individuals. ‘High end’ individuals are
those ‘who as executive board members or other employees
perform a significant influence function for the entity or whose
activities have, or could have, a material impact on the risk profile
of the entity.’
v. Bonuses or any element of performance pay should have time
delays of up to five years, or enough time to assess that the
transactions that engaged the bonus or performance pay did
indeed benefit the bank in the way intended.
vi. Institutional shareholders and fund managers should be more
engaged with the companies they invest in. To encourage this they
should comply, or explain non‐complaince, with a ‘stewardship
code’ overseen by the Financial Reporting Council in the same
manner as the Combined Code now the UK Corporate
Governance Code.
The full review can be found at:
www.audit‐committeeinstitute.
be/dbfetch/52616e646f6d4956f9ed6cb8ae5277dbec35c2
33bab54a5b/walker_review_consultation_160709.pdf
The Stewardship Code
As noted above, Walker’s final recommendation called for greater
shareholder involvement in banks and other financial institutions.
However, this concern about ‘shareholder apathy’ was a longstanding
one, and had been made in respect of larger, publicly traded, companies
in general. As early as 2002 a body called the ‘Institutional Shareholders
Committee’ ISC had issued a very brief document which called on
Institutional Shareholders to become more actively engaged with the
companies in which they invested, but the impact of this document was
very doubtful. Walker recommended that the Financial Reporting
Council the body which is responsible for the UK Corporate Governance
Code – see below should have responsibility in this area, and should
produce a more detailed and formal code based on the work of the ISC.
The Financial Reporting Council published the first Stewardship Code in
2010, and it has since been updated in 2012. It applies to ‘institutional
investors’ generally. This group covers not only institutional
shareholders themselves such as pension funds, or insurance
companies, but also those firms of ‘asset managers’ which typically look
after the shareholdings of such institutional shareholders. Like the UK
Corporate Governance Code, enforcement is on a ‘comply or explain’
basis only. Thus, asset managers are legally required to disclose how
they comply with the Code. Institutional shareholders, however, are
only recommended to make such disclosures, but are not required by
law to do so.
The Code is composed of seven principles. These recommend that
institutional investors should:
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‘1. publicly disclose their policy on how they will discharge their
stewardship responsibilities.
2. have a robust policy on managing conflicts of interest in relation to
stewardship which should be publicly disclosed.
3. monitor their investee companies.
4. establish clear guidelines on when and how they will escalate their
stewardship activities.
5. be willing to act collectively with other investors where appropriate.
6. have a clear policy on voting and disclosure of voting activity.
7. report periodically on their stewardship and voting activities.’
The Stewardship Code can be found at:
https://frc.org.uk/Our‐Work/Publications/Corporate‐
Governance/UK‐Stewardship‐Code‐September‐2012.pdf
The UK Corporate Governance Code
To reflect wider concerns about UK corporate governance a new version
of the Combined Code on Corporate Governance was produced in May
2010, and updated in 2012. It is now called the UK Corporate
Governance Code:
www.frc.org.uk/corporate/ukcgcode.cfm
One change introduced in the 2012 version of the Code is a
recommendation that the company’s annual report should ‘include a
description of the board’s policy on diversity, including gender, any
measurable objectives that it has set for implementing the policy, and
progress on achieving the objectives’. This follows on from the Review
undertaken by Lord Davies into the proportion of women on company
boards, which can be accessed at:
www.gov.uk/government/news/women‐on‐boards
Executive remuneration
The pay of top executives including directors within larger companies
has continued to generate much controversy in the UK: see, for example,
the various reports of the ‘The High Pay Centre’ at:
http://highpaycentre.org/
Since 2002, UK quoted companies have been required to prepare a
‘remuneration report’, providing details of the company’s remuneration
policies, and its implementation of those policies. This report had to be
put to a vote of shareholders. However, the vote was only ‘advisory’, so
that boards might lawfully choose to ignore a negative vote by
shareholders. As a result of ss.79–82 of the Enterprise and Regulatory
Reform Act 2013, the shareholders’ vote is now binding, so far as the
company’s policy on directors’ remuneration is concerned.
Long termism and the Kay Review
In October 2010 BIS launched a review of ‘corporate governance and
economic short‐termism’; see: www.bis.gov.uk/Consultations/a‐longterm‐
focus‐for‐corporate‐britain?catopen. One major concern was
whether UK equity markets in particular contributed towards the alleged
‘short‐termism’ of UK companies. To explore this issue further,
Professor John Kay was appointed to examine key issues related to
investment in UK equity markets and its impact on the long‐term
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performance and governance of UK quoted companies. In February 2012,
Kay and his colleagues produced an interim review, which provided a
wide range of evidence that British companies were indeed subject to
damaging short‐term pressures, particularly from shareholders.
Kay’s final report appeared in July 2012. See www.bis.gov.uk/kayreview
It listed 17 specific recommendations for addressing these short term
pressures. The bulk of these focused on investors both shareholders
and asset managers and included:
developing the Stewardship Code to ‘incorporate a more
“expansive” form of stewardship, focussing on strategic issues as
well as questions of corporate governance’
establishing an ‘investors forum’ to facilitate collective
engagement by investors
providing that those involved in the investment chain who had
discretion over the investments of others e.g. asset managers
or who gave investment advice to others, should be subject to
fiduciary standards
increasing transparency over the costs charged by asset
managers
ensuring that the structure of asset managers’ pay encouraged
long termism.
Other recommendations focused on companies themselves, and
included:
ensuring companies engaged more with long‐term investors
over major board appointments
ensuring the structure of directors’ remuneration rewarded
long‐term performance
discouraging companies from trying to manage shareholders’
‘short‐term earnings expectations’.
To support some of the above recommendations, Kay also proposed a set
of three ‘Good Practice Statements’, aimed at directors of companies,
asset managers and institutional shareholders. These statements would
highlight the responsibilities of these different actors for encouraging
more stewardship and more long‐term decision making.
In November 2012 BIS released its response to the Kay Review. This can
be viewed at:
www.gov.uk/government/consultations/the‐kay‐review‐of‐ukequity‐
markets‐and‐long‐term‐decision‐making
BIS largely accepted Kay’s analysis of the role which equity markets
played in encouraging short‐termism, and also agreed with almost all of
Kay’s specific recommendations. Of course, many of the
recommendations were aimed at investors, or companies, rather than
Government. But one practical response BIS made immediately was to
publish Kay’s three proposed ‘Practice Statements’ for directors, asset
managers and shareholders. These statements can be found in Annexes
A–C of the BIS response. However, these practice statements are not
legally binding on directors, shareholders or asset managers, and no
additional mechanisms have been developed to ensure that those to
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whom they are addressed follow them. It must remain to be seen, then,
whether they have any impact on the behaviour of their addressees.
Useful websites
The following are helpful websites about the implementation and
operation of the 2006 Act.
legislation.gov.uk
www.legislation.gov.uk/ukpga/2006/46/contents
This link provides full text of the Act itself, as well as explanatory notes
and tables of destinations and origins for the Act.
The Department for Business, Innovation and Skills BIS
This department of state now has responsibility for Company Law. In
June 2007 the DTI Department for Trade and Industry, the DfES
Department for Education and Skills and the Better Regulation
Executive became the Department for Business Enterprise and
Regulatory Reform BERR. It was then reformed as the Department for
Business, Innovation and Skills BIS in June 2009. Thus, over the course
of the reform act, it has been dealt with by the DTI, then BERR then
finally BIS.
This page contains links to a great deal of information about the
Companies Act 2006:
www.gov.uk/company‐and‐partnership‐law‐‐2
Recent case law
By forming a company and placing his business assets in the company in
return for shares in the company, the individual no longer has any legal
interest in the assets. See:
Hashem v Shayif 2008 EWHC 2380 Fam.
For an application of the rules on veil lifting in the context of matrimonial
proceedings, see:
Petrodel Resources Ltd v Prest 2013 UKSC 34.
On an important development in veil lifting in tort cases see:
Chandler v Cape Plc 2012 EWCA Civ 525.
On veil lifting in the group context see:
Linsen International Ltd v Humpuss Sea Transport PTE Ltd
2011 EWHC 2339 Comm
Gramsci Shipping Corp v Stepanovs 2011 EWHC 333 Comm,
2011 1 Lloyds Rep 647.
For an example of lifting the corporate veil on the ‘façade’ ground, see:
Anglo German Breweries Ltd in liquidation v Chelsea Corp Inc
2012 EWHC 1481 Ch.
On remedies, see:
VTB Capital plc v Nutritek International Corp 2013 UKSC 5.
On the test for ‘de facto director’, see the decision of the Supreme Court
in:
HM Revenue & Customs v Holland; Re Paycheck Services 3 Ltd
2010 UKSC 51.
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For an important case which may significantly extend the duties of
shadow directors, see:
Vivendi SA v Richards 2013 EWHC 3006 Ch.
On the meaning of ‘unfitness’ for the purposes of s.6 CDDA 1986, see:
Re AG Manchester Ltd in liquidation; Official Receiver v
Watson 2008 1 BCLC 321.
See:
Hawkes v Cuddy No 2 2009 EWCA Civ 291
where the Court of Appeal examined the relationship between a nominee
director and his nominator.
See:
West Coast Capital Lios Limited 2008 CSOH 72
where the Court of Session considered the proper purposes doctrine
under s.171.
On the scope of s.172, see:
Re Southern Counties Fresh Foods Ltd 2009 EWHC 1362 Ch
Stone & Rolls Ltd v Moore Stephens 2009 UKHL 39
R on the application of People & Planet v HM Treasury 2009
EWHC 3020 Admin.
Two recent cases have addressed the duty, recognised in s.1723, to
consider creditors’ interests when the company is insolvent or on the
verge of insolvency. The duty is to consider the interests of the creditors
as a general class:
GHLM Trading Ltd v Maroo 2012 EWHC 61 Ch
and see also:
Re HLC Environmental Projects Ltd 2013 EWHC 2876 Ch
where the court noted the objective elements in this duty.
See:
Gregson v HAE Trustees Ltd 2008 EWHC 1006 Ch
in which the court confirmed that s.174 codifies the pre‐existing law.
See also:
Lexi Holdings plc in administration v Luqman 2008 WLR D 1
and
Eastford Ltd v Gillespie 2010 CSOH 132.
On the scope of the corporate opportunity doctrine, see:
Berryland Books Ltd v BK Books Ltd 2009 EWHC 1877 Ch
and
O’Donnell v Shanahan 2009 EWCA Civ 751.
On remedies see:
Sinclair Investments UK Ltd v Versailles Trade Finance Ltd in
administration 2011 EWCA Civ 347.
On the new statutory procedure CA 2006, Part 11 for bringing a
derivative claim, see:
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Mission Capital plc v Sinclair 2008 EWHC 1339 Ch
Franbar Holdings v Patel 2008 EWHC 1534 Ch
Kiani v Cooper 2010 BCC 463
Langley Ward Ltd v Trevor 2011 EWHC 1893 Ch
Kleanthous v Paphitis 2011 EWHC 2287 Ch
Phillips v Fryer 12 June 2012
Bamford v Harvey 2012 EWHC 2858 Ch
Re Singh Brothers Contractors North West Limited 2013
EWHC 2138 Ch.
On the link between s.1221g IA 1986 and s.994 CA 2006, see:
Hawkes v Cuddy No 2 2009 EWCA Civ 291
McKillen v Misland Cyprus Investments Ltd 2012 EWHC 2343
Ch
Maresca v Brookfield Development and Construction 2013
EWHC 3151 Ch
and further on s.994 see:
Oak Investment Partners XII, Limited Partnership v Boughtwood
2009 EWHC 176 Ch
Fulham Football Club 1987 Ltd v Richards 2011 EWCA Civ
855.
On excessive director’s remuneration and s.994 see:
Re Tobian Properties Ltd 2012 EWCA Civ 998.
Similarly on dividends and unfairly prejudicial conduct see:
Sikorski v Sikorski 2012 EWHC 1613 Ch.
On valuation see:
Re Home & Office Fire Extinguishers Ltd 2012 EWHC 917 Ch.
Harborne Road Nominees Ltd v Karvaski 2011 EWHC 2214
Ch.
On the meaning of a subsidiary see:
Enviroco Ltd v Farstad Supply A/S 2011 BCC 511.
On corporate attribution see:
R v St Regis Paper Co Ltd 2011 EWCA Crim 2527.
On pre‐emption rights see:
Cream Holdings Ltd v Davenport 2011 EWCA Civ 1287.
On illegal returns of capital see:
Progress Property Co Ltd v Moorgarth Group Ltd 2010 UKSC
55.
On book debts see:
Re Harmony Care Homes Ltd 2009 EWHC 1961 Ch.
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Updated references for Dignam and Lowry
All references remain the same in the new edition except the following:
Section Reference in subject
guide
Reference to new
edition
Activity 4.3 3.33‐3.51 3.33‐3.53
Activity 5.3 4.13‐4.20 4.14‐4.21
Chapter 11: Dignam and Lowry Ch.10 is called ‘Derivative claims’,
not ‘The principal of majority rule’. This is the case in both editions.
Saturday, 22 February 2014
Succession recent development 2014
Chapter 3: Making a will
There have been a number of reported cases where lack of capacity
and/or lack of knowledge and approval have been pleaded. There is
often overlap between questions of capacity and knowledge and
approval. However, lack of knowledge and approval is more often
raised when there are ‘suspicious circumstances’ and it appears that it
is often pleaded as a way of hinting at undue influence or fraud
without actually pleading either of these.
The following cases have raised the issue of lack of capacity.
In: Hoff v Atherton [2004] EWCA Civ 1554; [2005] WTLR 99,
Banks v Goodfellow was applied. Although the testatrix suffered from
dementia and the burden of proving capacity rested on the defendant,
and although the defendant’s involvement in the preparation of the
will also required proof that the testatrix had knowledge and approval,
the will was valid. The Court of Appeal stated that the test of capacity
was issue-specific (i.e. it must be considered in relation to the particular
transaction, its nature and its complexity). The will was a
straightforward one and it had been witnessed by an independent
solicitor.
Schrader v Schrader [2013] EWHC 466 (Ch); [2013] WTLR 701.
The testatrix made a new will in 2006 (revoking an earlier will), which
left her house to one of her sons and divided the residue of her estate
equally between her two sons. Her previous will had divided the entire
estate equally between her two sons. The son receiving the house lived
with the testatrix. The 2006 will was challenged on the basis of lack of
capacity, lack of knowledge and approval and undue influence.
Lack of capacity was argued on the basis that the testatrix did not
know the value of her house. This was not sufficient to indicate a lack
of capacity. Many testators would not know the value of their home,
but such knowledge was not required for capacity. Appreciating that
the house was probably the most valuable asset by a long way was
sufficient.
The only other argument was that changing the division of
assets between the sons was odd. The court stressed (para.[82]) that
‘[t]estators do strange things and are entitled to be whimsical,
capricious, vindictive, wrong in belief or their acts beyond explanation
without that of itself proving lack of capacity (though those factors
may contribute to a bigger picture demonstrating it).’
Sharp v Adam [2006] EWCA Civ 449; [2006] WTLR 1059.
The Court of Appeal upheld the decision of the trial judge to the effect
that the testator, who had made his will while in the final stages of
severely debilitating progressive multiple sclerosis, had ‘crossed an
imprecise divide’. He lacked the capacity to arrive at a rational
judgment and there had been an inexplicable poisoning of his affection
for his daughters.
Kostic v Chaplin [2007] EWHC 2298 (Ch).
The deceased, who died in 2005, had made a will in 1988 and another
in 1989, both in favour of the Conservative Party. His son, who had
benefited under earlier wills, alleged lack of capacity. It was common
ground that, from the 1980s, the deceased had suffered from a mental
illness which caused him to believe that members of his family were
implicated in an international conspiracy of dark forces against him. It
was held that the deceased’s natural affection for his son had been
poisoned by his delusions. Banks v Goodfellow applied. The deceased
lacked testamentary capacity when he made the 1988 and 1989 wills
and so his £8,000,000 estate passed to his son.
Re Loxston [2006] EWHC 1291; [2006] WTLR 1567.
A will prepared by a professional will draftsman for a 97-year-old
woman, against whom an enduring power of attorney had been
registered, was refused probate on the ground that the woman lacked
capacity. The draftsman had been summoned by the woman’s carer
and the will was (to a significant extent) in the carer’s favour. Some
may wonder why such a will was set aside for lack of capacity rather
then undue influence. Could not undue influence be presumed? The
standard response is that it could not, but it does seem odd that it is so
difficult to set such a will aside. The final result in this case, the setting
aside of the will, must be correct, but the costs of the case would have
been significant and (although this is not mentioned in the report) will
almost certainly have come from the estate.
Blackman v Man [2007] All ER (D) 118; [2008] WTLR 389.
A childless widow left her estate to a couple from a Chinese takeaway
who had befriended her. The will was challenged by nephews and
nieces, but there was not sufficient evidence of lack of capacity and the
will was upheld.
Couwenbergh v Valkova [2008] EWHC 2451 (Ch).
A series of wills made by a 90-year-old testatrix, by which she excluded
her family who had been beneficiaries under an earlier will in favour of
a woman who had power of attorney for her, were duly executed, but
were invalid because she did not have testamentary capacity due to her
moderate to severe dementia. The solicitor involved did not actually
meet the deceased and was not present at the execution of any will.
Re Ritchie, Ritchie v Nat Osteoporosis Soc [2009] EWHC 709 (Ch).
The will, which was prepared by a solicitor and witnessed by a doctor
(thus abiding by ‘the golden rule’), disinherited the testatrix’s
children and left all her property to charity. It was refused probate on
the ground that the testatrix suffered from paranoia and had been
subject to delusions.
Re Perrins, Perrins v Holland [2010] EWCA Civ 840; [2011] Ch
270; [2010] WTLR 1415,
is a Court of Appeal case upholding the trial judge in applying the rule
in Parker v Felgate. This seems to be the first case where Parker v
Felgate has come before the Court of Appeal. But the problem with this
particular case is that the instructions for the will were given more
than a year before the will was executed and the beneficiary acted as
link between the testator and the solicitors who drafted the will. On
the particular facts, it may have been generous of the court to uphold
this will.
Cowderoy v Cranfield [2011] EWHC 1616 (Ch); [2011] WTLR
1699.
The deceased, who died at the age of 85 or 86 (there was some
uncertainty about her date of birth) suffered from progressive vascular
dementia in her final years. Her will was made some two years before
she died. In it she appointed D as her sole executor and left her entire
estate to him. Her son, who had been living with her, had died roughly
three months before she made her will. He died intestate so that his
estate passed to C. The evidence indicated that X was unhappy about
this. Her son was an alcoholic. D got to know X as he was a friend of
another alcoholic who drank with X’s son. D began to visit and care for
X in the period before she made her will. C argued that X did not have
testamentary capacity to make the disputed will, that she did not know
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and approve its contents and that it had been procured by undue
influence on D’s part. However, it was held (following Hoff v Atherton
and Re Perrins above) that the evidence justified the conclusion that
the deceased had testamentary capacity when she gave instructions for
her will and when she executed it, even though her condition
fluctuated at the time. She understood the extent of the property which
she was disposing of and was able to comprehend and appreciate the
claims to which she felt she ought to give effect. She was clear and
settled in her mind that she did not want C to benefit. She decided to
leave her entire estate to D not only because of what he had done for
her but also because she considered that leaving her estate to him
would improve the chance that he would continue to help her in the
future. Further, she knew and approved the terms of the will.
See also Gill v Woodall below.
Re Wilson [2013] EWHC 499 (Ch); [2013] WTLR 899.
The testatrix apparently made a will at home leaving her property to a
husband and wife unrelated to the testatrix. The beneficiaries had
assisted her in her old age. The husband had drafted the will for the
testatrix. In relation to capacity, it was held that the testatrix was
suffering from an ‘affective disorder’ brought on by bereavement,
something to which the testatrix consistently had a strong reaction.
The trial judge was clear that the test for capacity in s.2 of the Mental
Capacity Act 2005 (‘a person lacks capacity in relation to a matter if at
the material time he is unable to make a decision for himself in
relation to the matter because of an impairment of, or a disturbance in
the functioning of, the mind or brain’) was ‘more expressly tailored’ to
the facts of this case, but no argument was heard about whether this
test was different to the common law test in Banks v Goodfellow. The
testatrix was found to lack capacity.
In relation to knowledge and approval, as the drafter of the will was
(with his wife) the sole beneficiary of the will, this was ‘the clearest
possible example of a situation where the court should be vigilant and
jealous in examining the evidence in support of the instrument’ and
insufficient evidence was presented to show that the testatrix did know
and approve of the contents of the will.
Re Dharamshi [2013] EWHC 3917 (Ch).
In this case a testator was not found to lack capacity, despite a ‘severe
bereavement reaction’ to his wife’s death. In this case the will made
while bereaved reflected the testator’s true wishes, the testator knew
what he was doing and wanted to achieve and appeared to be fully in
charge of his mental faculties. In comparison to Re Wilson, above, the
main difference seems to be that while the testator here was bereaved,
that bereavement had not led to an ‘affective disorder’ affecting
capacity as in the Mental Capacity Act 2005, nor was there a disorder
of the mind affecting the testator’s recognition of claims upon him.
Burgess v Hawes [2013] EWCA Civ 94; [2013] WTLR 453.
The testatrix made a will in 1996 in which her residuary estate was to
be divided between her three children. In 2007, she made a new will,
dividing her residuary estate between only two of the three children.
The solicitor involved in drafting the will was experienced and noted
that the testatrix was ‘entirely compos mentis’, albeit with no formal
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assessment of the testatrix’s capacity. The will was explained to the
testatrix before execution. The appellant (one of the children entitled
under both wills) was in the room for both meetings with the solicitor.
The 2007 will stated that no financial provision was made for the
testatrix’s third child because of substantial lifetime provision that had
been made or would shortly be made, on the basis of inaccurate
information provided by the appellant to the solicitor. The trial judge
found that the testatrix lacked testamentary capacity under Banks v
Goodfellow: The testatrix knew she was making a will and appreciated
the extent of her property, but was incapable of understanding the
claims to which she ought to give effect (on the basis of evidence of
vascular dementia). The testatrix also lacked knowledge and approval
of the contents of the 2007 will. The appellant appealed, and the
appeal was rejected. The will was found to be invalid on the basis of a
lack of knowledge and approval. The case also considered questions of
capacity, and doubted the trial judge’s conclusion on this issue,
although the Court of Appeal declined to express a concluded view.
Mummery LJ stated at para.[60] that ‘the courts should not too readily
upset, on the grounds of lack of mental capacity, a will that has been
drafted by an experienced independent lawyer. If, as here, an
experienced lawyer has been instructed and has formed the opinion
from a meeting or meetings that the testatrix understands what she is
doing, the will so drafted and executed should only be set aside on the
clearest evidence of lack of mental capacity.’ The other members of the
Court of Appeal agreed. This is not a new rule of law, but rather an
evidential issue: the solicitor will usually be in a better position than
the court to assess capacity. In this case the solicitor said that he would
have required medical evidence of capacity if he had any doubts. The
Court of Appeal was also sceptical about the value of medical evidence
from a doctor who had never met the testatrix and based his evidence
solely on the testatrix’s medical notes. Mummery LJ noted more
generally (para.[13]): ‘if a properly executed will has been
professionally prepared on instructions and then explained by an
independent and experienced solicitor to the maker of the will, it will
be markedly more difficult to challenge its validity on the grounds of
either lack of mental capacity or want of knowledge and approval than
in a case where those prudent procedures have not been followed.’
Tociapski v Tociapski [2013] EWHC 1770 (Ch); [2013] WTLR
1821.
A demonstration of how capacity and knowledge and approval issues
can interact. The testator in this case suffered from medical conditions
which may have impaired his capacity. There were also questions
about whether the testator knew and approved of the contents of the
will and/or undue influence. The trial judge held that there was
insufficient evidence to prove that the testator lacked testamentary
capacity entirely, but there was sufficient evidence to show that the
testator’s capacity to know and approve of the contents of the will may
have been ‘adversely affected’. When combined with various other
factors (such as provisions in the new will being ‘out of character’; not
following a fairly consistent earlier practice in the testator’s wills and
that the beneficiary of the new will may have kept the testator
isolated) the suspicion of the court was aroused and it was not then
shown that the testator knew and approved of the contents of the will.
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Following the finding of lack of knowledge and approval, the judge did
not consider undue influence.
Simon v Byford [2013] EWHC 1490 (Ch); [2013] WTLR 1615 (an
appeal is outstanding).
The testatrix was an elderly lady suffering from mild-moderate
dementia which varied to some extent in its effects; there were ‘good
days’ and ‘bad days’. The testatrix’s will was challenged on the basis of
lack of capacity. The court held that the will was executed on one of
the testatrix’s ‘good days’ and that she understood the nature of a will,
the arrangements she was making, the scope of her property and the
claims other people had upon her. Despite her illness she therefore had
capacity on the day the will was made. The case highlights how
dependent decisions about lack of capacity are upon the very precise
facts, and even the presence of a recognised illness which would often
affect capacity will not automatically lead to a finding of a lack of
capacity.
On the topic of presumptions and so on, you may wish to read the
following article:
Ridge, P. ‘Equitable undue influence and wills’ (2004) 120 LQR
617.
The cases on lack of knowledge and approval follow on from
this.
Reynolds v Reynolds [2005] EWHC 6.
Although the elderly testatrix had testamentary capacity at the time of
making her will, and it had been validly executed, the defendant failed
to discharge the burden, cast on him due to the suspicious
circumstances, of proving that the testator knew and approved its
contents. This is a case where the will was prepared by a draftsman
who stated that he had taken instructions from the testatrix. The trial
judge (Rimer J) did not believe the draftsman. The judge held that the
draftsman must have taken his instructions from the beneficiary.
Franks v Sinclair [2006] EWHC 3365 (Ch); [2007] WTLR 439.
This case involved a solicitor who drafted a will for his mother (with
whom he was not on good terms). The will left half her estate to him
and its execution was witnessed by one of the solicitor’s son’s partners
and a secretary from his office. It was held that the testatrix had not
known and approved of the contents of the will.
This is another case, like Wintle v Nye, where it is hard to see why the
plea was not fraud (rather than lack of knowledge and approval). If
the solicitor drafted a will for his mother, in which she left property to
him, and he then arranged for her to execute it, when she did not
understand its contents, surely this was fraud. The solicitor involved
has since appeared before a Disciplinary Tribunal and has been fined
(£5,000 plus costs), but some may be surprised that the penalty was
not more severe.
Re Rowinska [2005] EWHC 2794; [2006] WTLR 487.
A testatrix aged 87 with a poor command of English was held not to
have known and approved of the contents of a will which purported to
leave her entire estate to the claimant beneficiary. The beneficiary had
prepared the will and friends of his witnessed it.
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Devas v Mackay (also known as Re D) [2009] EWHC 1951 (Ch);
[2009] All ER (D) 09.
A testatrix who had suffered several strokes was held not to have
known and approved of the contents of a will which left her estate to
the son of her carer. It seems that, after this civil case was over, those
who had prepared the will were charged with a series of criminal
offences and that they pleaded guilty to forgery. But, in that case, why
did those who attacked this will in the civil proceedings not do so on
the ground of forgery? It should be easier to prove forgery in civil
proceedings than in criminal proceedings. Those who attack ‘suspicious
wills’ always seem very reluctant to allege misbehaviour and this is a
very clear example.
Gill v Woodall (also known as Gill v RSPCA) [2010] EWCA Civ
1430; [2011] Ch 380.
The deceased (M) and her husband (F) had executed mirror wills
which excluded G, their only child, stating that she had already been
well provided for. F predeceased M and when M died the RSPCA was
the sole beneficiary of her estate. G contested the validity of the will,
arguing that M had not known or approved of the terms of the will. M
had suffered from agoraphobia, which caused her extreme anxiety
when leaving home and/or when in contact with strangers. The court
adopted a two-stage process to the question of whether M had known
and approved of the contents of the will. It found that there was a
prima facie case that M had not known and approved the contents but
also found that that case had been rebutted as F and M had both
attended meetings with solicitors to give instructions and for the wills
to be read, confirmed and signed, and a draft will had been sent to
their home for consideration. However, the court also found that M
had executed her will under undue influence from F and revoked the
will. The Court of Appeal dismissed the RSPCA’s appeal. The judge had
been right, or at least entitled, on the evidence before him to conclude
that G had made out a prima facie case that M had not known or
approved of the contents of the will when she signed it. However, the
judge was wrong, and not entitled to conclude that the RSPCA had
rebutted that case. If the judge had approached the question of
knowledge and approval as a single issue, he might have reached the
right conclusion. It did not seem wise, particularly where there were a
large number of witnesses heard over many days, to consider an issue
in two stages when those stages ultimately involved the same
question, namely whether M had appreciated what was in the will
when she signed it.
Greaves v Stolkin [2013] EWHC 1140 (Ch); [2013] WTLR 1793.
Another case in which capacity and knowledge and approval was
raised. The elderly testator used a solicitor to make a codicil to his will,
making provision for his long-term partner. This codicil was very
similar to an earlier purported codicil which was not legally
enforceable. One of the testator’s sons challenged the validity of the
codicil on the basis of capacity and lack of knowledge and approval. In
relation to capacity Newey J repeated the view of Mummery LJ in
Burgess v Hawes, that where an experienced solicitor regarded the
testator as possessing capacity, it would be rare for the court to reject
that. Newey J considered that the testator had capacity. Newey J
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stressed the approach taken in Gill v Woodall (above), that in assessing
lack of knowledge and approval, there is no need to follow a distinct
two-stage test of finding suspicions aroused, followed by a reversed
burden of proof (although also acknowledging that this approach had
been applied in Burgess v Hawes). The question is simply whether the
person seeking to rely on a purported testamentary disposition has
discharged the burden of establishing that the testator knew and
approved of the contents. In this case, the role of the independent
solicitor made it unlikely that the testator lacked knowledge and
approval (citing a remark by Mummery LJ at para.[13] in Burgess v
Hawes). The codicil was therefore valid.
Cushway v Harris [2012] EWHC 2273 (Ch).
Harris, a solicitor, drafted wills for his two elderly aunts. Their earlier
wills had left their property to each other, but in these wills one third
of the residuary estate was left to Harris, who was also appointed
executor. It was alleged by the claimants that the testatrices lacked
knowledge and approval of the wills. The court observed that in this
case both testatrices were elderly, in poor health and one may have
lacked testamentary capacity. The suspicion of the court was raised,
and Harris did not appear to try and prove knowledge and approval.
The court directed that the papers be sent to the Director of Public
Prosecutions to consider whether any further action should be taken
against Harris. This final step suggests although the case was pleaded
as concerning lack of knowledge and approval, the court considered
the case to be one of fraud. However, fraud was not pleaded.
Then, contrast Reynolds, Franks, Rowinska and Devas with:
Sherrington v Sherrington [2005] EWCA Civ 326; [2005] 3 FCR
538; [2005] WTLR 587,
where the Court of Appeal allowed an appeal against the judgment of
Lightman J. The court held that the testator, a solicitor, had known
and approved of the contents of a simple will prepared for him by his
non-legally qualified stepdaughter. In it he left his entire, and
substantial, estate to his second wife, his stepdaughter’s mother, so
disinheriting the adult children of his first marriage, with whom he was
on good terms. The facts of this case are unusual, but, given the result,
it must be asked whether it was the correct approach to attempt to
attack this will on the ground that the testator lacked knowledge and
approval. It may well have been a way of hinting at undue influence
without formally alleging it, but, if it was, it did not work. Would the
children have stood a better chance of success had they
straightforwardly alleged undue influence?
See also:
Gill v Woodhall, above (where, in the event, the Court of Appeal
held it was unnecessary to consider the issue of undue influence).
Cowderoy v Cranfield, above.
Hubbard v Scott [2011] EWHC 2750 (Ch); [2012] WTLR 29.
An allegation that a sole beneficiary under a will unduly influenced a
testator was not established where there was no evidence that the
beneficiary had so victimised, dominated or coerced the testator as to
overbear his volition. The testator executed his final will in 2009, in
which he left his entire estate to K, his cleaner. He died 11 days after
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its execution. In the instant proceedings, much of the disputed
evidence was concerned with the length and nature of the relationship
between K and the deceased, the allegation being that it was unlikely
that he would have left his entire estate to K, and that K must have
exerted undue influence over him when he made his final will. The will
was upheld. The court held that, as there was no presumption of
undue influence in cases of testamentary gifts, the test to be applied
was more stringent than that laid down in Royal Bank of Scotland Plc v
Etridge (No 2) [2001] UKHL 44; [2002] 2 AC 773. In discharging the
evidential burden of establishing undue influence, victimisation,
domination or coercion needed to be established and it had to be
shown that W’s final will was not the offspring of his own volition.
Wharton v Bancroft [2011] EWHC 3250 (Ch).
The deceased, who was terminally ill, made a will in contemplation of
his intended marriage to M, leaving the entirety of his substantial
estate to her. M was his partner of 32 years. The will was prepared by
his solicitor and read to him. M was not present when he gave
instructions. Immediately after making the will, he married M. He died
a couple of days later. His children from his first marriage and a child
from an extra-marital relationship challenged the will, asserting that it
was obtained as a result of M’s undue influence. It was held (applying
Cowderoy v Cranfield, above) that the execution of a will as a result of
undue influence was a fact that had to be proved by those who
asserted it. On the evidence, the death-bed will in favour of M could
not be explained as the result of coercive pressure which deprived him
of free choice. He had understood that by giving ‘all to M’, he was not
giving anything to anybody else. The will-making process resulted in a
document containing the last true wishes of a free and competent
testator.
Re Edwards [2007] EWHC 1119 (Ch); [2007] WTLR 1387.
This is one of the very few reported cases where undue influence has
been pleaded and the plea has succeeded. This was undue influence by
an adult child over his aged mother.
Schrader v Schrader [2013] EWHC 466 (Ch); [2013] WTLR 701.
A very unusual case in which a plea of lack of knowledge and approval
failed, but one of undue influence succeeded. There was no direct
evidence of pressure on the testatrix, but sufficient circumstantial
evidence to support a finding of undue influence. The judge said
(para.[56]):
‘[t]here is absolutely no question of his physically abusing his mother
(no one even began to suggest that) but I consider that his physical
presence and personality around the house would be likely to produce
a significant degree of subservience in an anxious, dependent,
increasingly frail elderly lady in his care. I am in no way finding abuse.
I am sure that he was a caring son who tended to his mother's needs.
However, it is entirely plausible that he would get cross with her from
time to time and that she should be anxious about him and anxious to
please.’
This is not especially strong evidence of undue influence, given the
high threshold. Several of the factors outlined by the court would more
usually lead to a finding of a lack of knowledge and approval on the
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basis of a suspicious will. The court did consider this issue (at
para.[92]), but thought that the testatrix’s actions in amending the
draft will (she entered the name of a charity to receive a gift) showed
that she knew and approved of the contents.
The following two cases show that draftsmen have to take care about
getting involved with suspicious wills. In:
Sifri v Clough & Willis [2007] EWHC 985 (Ch); [2007] WTLR
1453,
the solicitor who drafted the will had to pay part of the costs of action
to set it aside. He had taken instructions directly from a beneficiary.
And in:
Re Key, Key v Key [2010] EWHC 408 (Ch): [2010] 1 WLR 2020,
the will made by an 89-year-old man in the week after his wife’s death
was set aside for lack of capacity and lack of knowledge and
approval. Briggs J criticised the solicitor who had drafted the will for
failing to follow the ‘golden rule’ (which says that a doctor should be
present if there are doubts about capacity). This was particularly
foolish of the solicitor, as the will was quite different from earlier wills
and benefitted mainly the testator’s daughters (who were present
when the instructions for the will were given) rather than his sons
(who were not present). The reference to the ‘suspicious
circumstances’ rule in this case appears to be a clear reference to
pressure put on the testator by his daughters.
Then there are the cases on lack of due execution.
Sherrington v Sherrington, above,
was a case which also involved an allegation of lack of due execution
and, on this point also, the Court of Appeal allowed an appeal against
Lightman J’s decision and held that the will had been properly
executed. It is easier to sympathise with the Court of Appeal’s decision
on this point than it is in relation to lack of knowledge and approval.
The Court of Appeal was satisfied that the witnesses had signed the
will with the intention of attesting the testator’s signature or of
attesting the will (Re Beadle [1974] 1 WLR 417 approved). When a will
contained the signatures of the deceased and the witnesses and an
attestation clause, the presumption of due execution would prevail
unless there was the strongest evidence that the witnesses did not
intend to attest. The will was upheld.
Channon v Perkins [2005] EWCA Civ 1808; [2006] WTLR 425.
The Court of Appeal considered and applied Sherrington. The will
appeared on its face to have been properly attested. The witnesses
accepted that the signatures on the will were theirs, but had no
recollection of having attested it. The Court of Appeal held that the
trial judge had been wrong to refuse probate. The strongest evidence
was required to rebut the presumption of due execution.
Channon was followed in:
Re Morgan, Griffin v Wood [2008] WTLR 73.
See also:
Couwenbergh v Valkova, above,
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where, in addition to rejecting the allegation of incapacity, the court
also held that, despite the fact that the evidence of the one living
witness being contradictory, it fell far short of the ‘strongest evidence’
required (according to Sherrington v Sherrington, above) to rebut the
presumption of due execution.
Re Rawlinson, Kayll v Rawlinson [2010] EWHC 1269 (Ch); [2010]
WTLR 1443 (Ch D),
where there was a (basically factual) dispute as to whether the testator
had acknowledged in the presence of both witnesses. Held, as a matter
of fact (not a question of a presumption), that he had. The judge in this
case followed the line that the testator does not need to do much in
order to acknowledge. It is suggested that this is the correct approach.
Kentfield v Wright [2010] EWHC 1607 (Ch).
A will which was regular on its face and contained an attestation
clause stating that it was signed in the presence of two witnesses was
held to have been properly executed in accordance with the attestation
clause. The evidence to suggest that only one witness had been present
at the time was not strong enough to rebut the presumption of due
execution. (Sherrington v Sherrington, above, applied.)
However, there are several recent examples of cases where wills have
been set aside for lack of due execution:
Barrett v Bem [2012] EWCA Civ 52.
A will was not validly executed under the Wills Act 1837 s.9(a) where
a testator, having expressly stated a desire to make a will, and
approving its contents, allowed the sole beneficiary under the will to
sign on his behalf after the testator attempted and failed to sign the
will himself. The Court of Appeal firmly rejected the argument that
because the testator had not objected to the beneficiary signing on his
behalf, the testator had directed the beneficiary to do so. The
requirement of signing at the testator’s direction in s.9(a) required a
positive action by the testator. In this case the testator had not
positively requested the beneficiary to sign on his behalf. The Court of
Appeal observed, obiter, that despite s.15 of the 1837 Act expressly
rendering a gift to an attesting witness ‘utterly null and void’, there
was no statutory provision to cover the situation in the instant
proceedings, and it could not properly be found that the gift was void
on that basis..
Re Papillon [2006] EWHC 3419 (Ch); [2008] WTLR 269.
This is a case where the beneficiary prepared the will, but she was
caught out because of her poor command of English.
Lim v Thompson [2009] EWHC 3341; [2010] WTLR 661.
A purported will containing a photocopied signature of a testator and
original signatures of two witnesses did not amount to a document that
had been signed by the testator at all in accordance with the Wills Act
1837 s.9 and was therefore not valid. There were several purported
wills here, but none of them was valid. One will had been attested by
only one witness; there was no evidence, in relation to another, that
the deceased had signed or acknowledged his signature in the presence
of both witnesses (and one witness had apparently not signed it until
after the deceased had died); and, as to a third will, the most that
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could be said was that the witnesses had attested a copy of a copy of a
will. A photocopy of a previous version of a will with a photocopied
signature of the testator was not a document which was signed by the
testator at all. It did not matter whether the signature was attached in
the presence of the witnesses or merely acknowledged in their
presence but it did have to be an original signature so that the court
could examine it and properly evaluate the evidence as to due
execution. Furthermore, the circumstances in the case were so
suspicious that no presumption of due execution arose.
Re Singh (Deceased) [2011] EWHC 2907 (Ch); [2012] WTLR 1.
A will was invalid where there was evidence of sufficient strength to
rebut the presumption of due execution arising from the witnesses’
signatures appearing together with an attestation clause. Here, the first
witness to the will maintained that he did not recall signing S’s will but
remembered an occasion when he had witnessed S’s signature on a
document when there had been no one else present. He also
maintained that he had never spoken to or met the second witness. It
was held (following Channon v Perkins, above) that there was a sliding
scale according to which evidence would constitute the strongest
evidence necessary to rebut the presumption of due execution in any
particular case. The burden had been satisfied here. The overall
probability was that the witnesses had signed separately. The evidence
relied upon in previous authority (specifically, Sherrington v
Sherrington, Channon Perkins, Couwenbergh v Valkova, and Kentfield v
Wright, above) where the presumption of due execution had not been
rebutted, fell well short of the evidence available to rebut the
presumption in the instant case.
Note also the unusual case of:
Marley v Rawlings [2014] UKSC 2.
A mirror will which had been signed in error by the wrong spouse did
not fail for want of formalities. In executing their mirror wills, both X
and Y had mistakenly executed each other’s will. The error went
unnoticed both at the time of execution and on the death of Y: it was
not until X’s death that the error was discovered. The testator signed
the document and intended to give it effect by his signature. The
signature requirements of s.9 of the Wills Act 1938 were satisfied
(paras.[57]–[59]). However, the contents of the will still lacked
knowledge and approval. The will was nevertheless capable of being
rectified (see below).
Rectification
Returning to another aspect of the plea of lack of knowledge and
approval, the plea covers cases of mistake (and may well be applied
more logically in cases of mistake than in cases where there has been a
suspicion of misbehaviour).
Where there has been a mistake, a will may be rectified under s.20 of
the Administration of Justice Act 1982, but only if there has been a
clerical error or a failure to understand the testator’s instructions.
Re Martin, Clarke v Brothwood [2006] EWCA 2939 (Ch); [2007]
WTLR 329.
A solicitor included in a will the words ‘twentieth shares’ when the
testatrix really intended ‘twenty per cent shares’. It was not clear how
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the error had come to be made, but, on the assumption that the
testatrix had used these words and the solicitor had inserted them
without realising that they did not make sense, the trial judge thought
that this was a ‘clerical error’. But was it? See casenote by R. Kerridge
and A.H.R. Brierley in [2007] Conv at pp.558–63.
Martin v Triggs Turner Barton [2009] EWHC 1920 (Ch); [2009]
WTLR 1339.
This is also a rectification case, where it was held that the draftsman
had failed to understand his instructions. The draftsman was a solicitor
who denied that he had so failed, but the court did not accept his
version of events. This case demonstrates that it is essential for
professional will draftsmen to keep full attendance notes of their
instructions.
Gerling v Gerling [2010] EWHC 3661; [2011] WTLR 1029.
A will which created a partial intestacy by failing to appoint
remaindermen on the termination of a trust created in relation to half
share in the residuary estate was capable of being rectified under s.20
where to do so would not substantially prejudice the beneficiary
affected and where there was nothing to indicate any intention by the
testatrix to leave part of her estate undisposed of by her will. This case
also addressed the issue of applications for rectification made out of
time (as to which, see below).
Re Bimson [2010] EWHC 3679 (Ch).
It was plain that the testatrix intended that her trustees should have
power to advance capital to a particular beneficiary during his lifetime,
and it was assumed to be her wish that the power should be exercised
in order to ensure that he always had sufficient to meet his needs.
However, as the will stood, he had only a bare life interest and the
trustees had no power to release or advance capital to him. The will
was rectified accordingly.
Austin v Woodward [2011] EWHC 2458 (Ch).
A claim for rectification of a will was granted under s.20 where there
was clear evidence that the misuse of new precedents had led to the
testatrix’s intention that a beneficiary take a property absolutely not
being reflected in that will. It was clear in the light of the evidence that
the will as currently drawn did not reflect her intentions. It was plain
that the impugned provision of the will had been based on a new
precedent which had been used without any thought given to the
impact that that might have on the relevant disposition. There was no
doubt that an error of that type was a clerical error that was conducive
to an order for rectification under s.20(1)(a).
Joshi v Mahida [2013] EWHC 486 (Ch); [2013] WTLR 859.
The testator’s will left ‘one half of my share’ in his house to his brother
and nephews. The other half of the share was undisposed of, so would
pass to the testator’s wife in the residue. However, another clause in
the will stated that the whole proceeds of the sale of the testator’s
share in the property should go to his brother and nephews, so the wife
would receive nothing from the testator’s share in the house. It was
accepted that there was a clerical error under s.20. The original
language of ‘one half of my share’ would was changed to ‘my one half
share’ in the house.
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Note also:
Marley v Rawlings, above,
The Supreme Court held that where a testator does not know and
approve of the entire contents of a will, it can still be rectified under
s.20. Obiter, the Supreme Court also said that the will could be
rectified if the will failed to satisfy the formality requirements of s.9 of
the Wills Act. In the case of a failure of formalities it is not clear how
such a rectified will would become valid, as the formality requirements
remain in effect. There is considerable discussion of clerical error in the
case. The Supreme Court favoured a ‘wide’ approach to understanding
the term. See paras [50]–[53] and [60]–[85]. There are also important
remarks on the exercise of the court’s inherent power to delete words,
see paras [43]–[49].
Section 20(2) of the Administration of Justice Act 1982 requires that
an application for an order for rectification ‘shall not, except with the
permission of the court, be made after the end of the period of six
months from the date on which representation with respect to the
estate of the deceased is first taken out’. This requirement has been
considered in a few recent cases.
In:
Gerling v Gerling, above,
the court observed that there was an unfettered discretion to grant
permission to make a claim for rectification outside that time limit. The
burden of establishing a case for making such a claim out of time was a
substantive one and lay with the person applying for relief; it was not
merely a procedural time limit. Relevant considerations included the
strength of the claim, the length of the delay, the reasons for the delay,
the prejudice to which it might have given rise, the promptitude with
which the claim was first notified, the existence of negotiations and
whether the estate had been distributed. Ultimately, it was for the
court to decide whether it was just and proper, in all the
circumstances, to extend time for making the claim.
In:
Austin v Wooward, above,
although the application was substantially out of time, it was held to
be appropriate to grant an extension of time. The delays were not
delays for which the applicant could be criticised, and she had brought
the proceedings with reasonable promptitude. The fact that the estate
had not yet been distributed and that she would be significantly
prejudiced and left to a less perfect remedy if the extension was
refused, were also factors that led the court to hold that it was just and
proper to extend time in her favour.
Chapter 4: Revocation
Civil partners
Under the Civil Partnership Act 2004 the provisions of s.18 Wills Act
1837 apply to civil partners.
But in:
Court v Despallieres [2010] EWHC 3340 (Ch); [2010] 2 All ER 451
(Ch D),
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it was held that a will which stated (in a general way) that it would not
be revoked by a subsequent civil partnership was revoked when the
testator entered into a civil partnership, because s.18B(3) of the Wills
Act requires that it must appear from the will that the testator was
expecting to form a civil partnership with a particular person and
he must intend that the will should not be revoked by the formation of
the civil partnership. A general declaration that the will should survive
any civil partnership did not suffice. The section was clear. The same
point would apply in the case of a marriage. The will has to show that
the testator was expecting to marry a particular person.
There have been a number of recent cases in which wills have been
missing and Sugden v Lord St Leonards has been applied. A special
recent example is:
Re Ciebrant, Van Kwawagan v RNLI [2008] EWHC 2246 (Ch).
The deceased’s last will was almost certainly destroyed by someone
who would have benefited if he had died intestate, but the application
of the rule in Sugden allowed the charities who would have benefited
under the will to obtain probate of it.
Chapter 5: Construction
Sammut v Manzi [2008] UKPC 58; [2009] 1 WLR 1834.
The Privy Council had to interpret a badly drafted will and came to a
different conclusion from the Court of Appeal in the Bahamas. This is
not a very helpful case. The Privy Council did not make it clear
whether the will was, or was not, professionally drafted and also said
nothing about the distinction between the literal and the intentional
approaches to construction. There is no Bahamian equivalent to s.21 of
the AJA (or, if there is, the PC did not mention it) and the opinion of
the PC reads as though it were applying the pre-1983 English law on
construction. Students might like to consider how this case would have
been dealt with if it had come before an English court today and so
would have been covered by s.21.
Re Frost [2013] EWHC 435 (Ch); [2013] WTLR 673.
The testator made a will leaving one third of his estate to each of his
two daughters. The remaining one third of his estate was to pass to
other relatives. Before his death, the testator also made gifts of
£100,000 to his two daughters. The question was whether these gifts
should constitute part of the shares to which the daughters were
entitled under the will, due to the presumption against double
portions. If the gifts were regarded as part of the estate, each daughter
would only have been entitled to a little more from the estate. The
court held that the presumption against double portions does not
apply, on the basis that the inter vivos gifts were not of the character of
portions, instead they were intended to reimburse the daughters and
their families for payments made in the past and to be made in the
future for the testator’s care.
Marley v Rawlings, above.
An argument was raised about construction in this case, leading to
obiter remarks by the Supreme Court which consider the construction
of wills to be the same as all other types of documents, with s.21 of the
Administration of Justice Act 1982 providing additional assistance to
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the court where required. This description of the process of
construction seems to be contrary to that which prevailed before 1982.
See paras [17]–[26].
Chapter 6: Family provision
Domicile
Cyganik v Agulian [2006] EWCA Civ 129; [2006] 1 FCR 406.
The partner of a man who died domiciled in Cyprus could not claim
under the 1975 Act, although the deceased had assets of around £6.5
million in England and had made an English will which was admitted
to probate.
See also the recommendation of the Law Commission as to a partial
reform of the domicile requirement (see below).
Spouses
P v G, P and P [2004] EWHC (Fam); [2006] 1 FLR 431.
A ‘big money’ case (the estate was worth over £5 million and there
were significant assets outside the estate, including a pension fund
worth about £4.5 million and sums of £1.2 million nominated to the
deceased’s children by his first marriage). Black J awarded the widow a
capital sum of £2 million (to include the matrimonial home) and
ordered the pension trustees to purchase an annuity for her. Of the
divorce analogy in s.3(2), Black J said it was the minimum that a
widow should attain. Indeed, she said that the analogy was almost
impossible to apply on death, particularly because the tax position on
death is completely different to the tax position on a divorce.
Cunliffe v Fielden [2005] EWCA Civ 1508; [2006] Ch 361; [2006]
2 All ER 115; [2006] WTLR 29.
The Court of Appeal held that the effect of White v White was not to
give rise to a presumed entitlement to equal division of assets between
spouses in the context of the 1975 Act. The judge had awarded the
widow a lump sum of £800,000 out of a net estate of £1.4 million. She
had begun working as housekeeper some 18 months before the
deceased died. She became financially dependent on the deceased,
initially as housekeeper and then as his wife. The will was executed a
year before he died and a few days before he married the claimant.
She had benefited by survivorship from a number of funds and policies
in their joint names. Under the will, she was a member of a class of
objects of a discretionary trust of the residuary estate.
The Court of Appeal overturned the trial judge’s decision. He had not
explained how he had exercised his discretion. In the context of
reasonable financial provision under s.1(2)(a) and s.3(2)(b), the Court
of Appeal stated that there was a clear difference between a widow
who had been married for many years and who had made an equal
contribution to the family of the deceased and a person (such as the
claimant here) who had been married for only just over a year and
who had made little contribution to the family wealth. White v White
could be departed from if there was good reason. The Court of Appeal
substituted a lump sum of £600,000.
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Re Waite (also known as Barron v Woodhead) [2008] EWHC 810
(Ch); [2009] 1 FLR 747; [2008] WTLR 1675.
The applicant widower (B) applied for reasonable provision out of the
estate of his late wife. The claim was made against the respondent
residuary beneficiaries of the estate (W), the deceased’s two children
who were also the personal representatives of her will. B, who was 73
at the time of the hearing, met the deceased in 1986 and they
cohabited until their marriage in 1993. Both spouses were heavy
drinkers and there were incidents of domestic violence carried out by
both parties. The couple lived in B’s property where he had run a
haulage business until he was declared bankrupt in 1999. They
separated in 2001 but divorce proceedings were never commenced.
The net estate was valued at about £315,000. W submitted that no
award should be made to B on account of his conduct, namely the
domestic violence and his evasiveness with both the court and the
trustee over financial matters.
The court (following Cunliffe v Fielden, above) held in favour of the
applicant. The Act contemplated an objective, two-stage approach.
First, the court had to consider the factors set out in s.3 in order to
determine whether it was reasonable to make no provision for B. If it
considered that reasonable provision had not been made, it had then to
consider the same factors in order to evaluate any provision to be
made under the Act. Despite the uncertainties in respect of B’s financial
position, the court was not satisfied that he had funds that would
enable him to rehouse himself. In all the circumstances the will did not
objectively make reasonable financial provision for B. Therefore the
suggestion that there should be no award or a very small award was
wholly unrealistic. However, the principal concern of the court was to
ensure that B had a roof over his head and had sufficient means for his
everyday needs. In all the circumstances of the case, it was not
appropriate for there to be a substantial additional capital award.
Considering B’s needs, it was therefore proposed to direct that he had a
life interest in £100,000 to be used to purchase suitable
accommodation. In addition, B should be entitled to a lump sum of
£25,000 to defray any costs of moving, to set himself up in the
property and meet future expenses.
Iqbal v Ahmed [2011] EWCA Civ 900; [2011] 3 FCR 1; [2011]
WTLR 1351.
It was appropriate to give a widow who had been financially
dependent on her husband a right to occupy her matrimonial home for
life, half of any sale proceeds, and the whole of the husband’s
residuary estate by way of reasonable financial provision, rather than a
life interest in the home. The deceased had been married to W for 22
years when he died. S was his son from an earlier marriage. W was 61
years old at the time of the hearing, spoke little English and had been
financially dependent on the deceased, though she had accumulated
£3,000 in savings. The will gave W £8,000 and a right to occupy the
matrimonial home rent free. That right was subject to an obligation to
keep the property in repair. Subject to her right of occupation, the
property was given to S absolutely, as was the residuary estate. The
property was worth approximately £115,000. It was poorly maintained
and required repairs costing over £30,000. The residuary estate was
worth £28,000. The deceased had given S a gift during his lifetime of
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£21,500 and S was comfortably off. The judge ordered that W should
receive the right to occupy the property for life, half the proceeds of
sale of the property, the whole of the residuary estate and S’s
agreement to pay half the insurance and the structural repairs of the
property.
Lilleyman v Lilleyman [2012] EWHC 821 (Ch); [2012] 3 WLR
754; [2012] 2 FCR 171; [2012] WTLR 1007.
The claimant had been married to the deceased for a little over two
years at the time of his death. The deceased left a large estate (over £6
million). Under the deceased’s will, the claimant received limited rights
to occupy both the matrimonial home and an apartment, a fixed
annuity worth £378 per month and personal chattels worth £18,000.
The claimant argued that this provision was not reasonable. Most of
the residuary estate was left to the deceased’s sons by a previous
marriage. The court held that the provision made for the claimant was
not reasonable. ‘Reasonable’ provision for a spouse was not limited to
providing financial security for the rest of her life. A wider range of
considerations were relevant, including (but not limited to) the
hypothetical divorce provision in s.3(2). ‘Financial obligations and
responsibilities’ in s.3(6) of the 1975 Act included the testator’s moral
financial obligations, in addition to any legally binding obligations. The
court also considered that the relationship between the claimant and
the deceased’s sons had broken down, which would make it difficult
for them all to have interests in the same properties. The court held
that in addition to the property given by will, the claimant should
receive the estate’s entire interest in the matrimonial home and
apartment, as well as the estate’s future interest in another property (in
all cases, the claimant could receive a lump sum representing present
market value if she wished).
Civil partners
The Civil Partnership Act 2004 adds the civil partner or former civil
partner of the deceased to the categories of applicant who can apply
under s.1 of the Act.
The appropriate standard for civil partners is ‘such financial provision
as it would be reasonable in all the circumstances of the case for a civil
partner to receive, whether or not that provision is required for his or
her maintenance’.
But note that in:
Southern Housing Group Ltd v Nutting [2004] EWHC 2982; [2004]
All ER (D) 347; [2005] 1 FLR 1066,
Evans-Lombe J upheld the decision of a recorder to the effect that two
homosexuals were not living together as husband and wife and that
the survivor was not, therefore, entitled to succeed to an assured
tenancy as the ‘spouse’ of the deceased. Whether the relationship is
heterosexual or homosexual, the crucial requirement of living together
as husband and wife is a ‘commitment to permanence – the
relationship must be an emotional one of mutual lifetime
commitment, openly and unequivocally displayed to the outside
world’. There was no such commitment in this case.
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And in:
Baynes v Hedger [2008] EWHC 1587 (Ch); [2008] 2 FLR 1805;
[2008] WTLR 1719,
the parties were not ‘living together as civil partners’ because: (i) their
relationship was not openly and unequivocally displayed to the outside
world; and (ii) they had two separate establishments.
Cohabitants
Re Dix [2004] EWCA Civ 139; [2004] 1 WLR 1399; [2004] WTLR
331.
A three-month separation between the respondent and the deceased
did not render the respondent unable to satisfy the provisions of the
1975 Act since it was clear that this was not the settled situation and
the couple were still part of the same household.
Lindop v Agus [2009] EWHC 1795 (Ch); [2010] 1 FLR 631; [2009]
WTLR 1175.
A claimant established that she had been living as the wife of a
deceased within the meaning of s.1(1A) of the 1975 Act even though
she retained a different address for official correspondence. L had met
D, a dentist, at the practice where she worked part time. Both had
children from previous relationships and L was living with her father
after her divorce. She later moved into D’s house and lived there for
several years before his death. However, she continued to use her
father’s address for official correspondence and she remained
registered on the electoral roll at his house. After D’s death, L brought
a claim for financial provision as a person who was living in the same
household as D as his wife and/or as a person who was being
maintained by D. The court was required to determine as a preliminary
issue whether L was eligible to bring a claim. D’s executors submitted
(inter alia) that L could not establish that she was living as D’s wife as
she still used her father’s address for correspondence, and her
relationship with D was therefore not openly and unequivocally
displayed to the outside world. Despite a lack of documentary
evidence, there was sufficient corroboration from witness evidence to
find that L and D had lived in the same household for a period of at
least two years before D’s death. There was a stable sexual relationship
between them, and D provided a roof over L’s head and paid for the
outgoings of the house. He also paid for holidays and clothes for L, and
they looked after the children together. It was plain that they were
living together. The remaining question was whether L was living as
D’s wife. The court was required to give effect to the statute, which
simply required that L and D be living as man and wife. The fact that
L’s bank and other public bodies sent letters to her father’s address
shed little light upon whether she was living with D as his wife. Whilst
some of the evidence was inconsistent with L’s case, it had to be
weighed against the other evidence, which pointed towards L and D
living openly together and displaying that to the outside world.
Marriages are multifarious. L had been subject to a bitter divorce, and
in those circumstances there was nothing inconsistent with her living
with D as ‘man and wife’ whilst retaining a different address as
security or in case the relationship broke down.
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Re Evans [2011] EWHC 945 (Ch); [2011] 2 FLR 843; [2011]
WTLR 947.
Since the disposition of the estate of an individual who had died
intestate did not make reasonable financial provision for his partner
(C), she was entitled to a sum from his estate under the 1975 Act to
allow her to purchase a house. That property would be held on trust
for the deceased’s sons subject to an interest in C’s favour entitling her
to live there for as long as she wished. The starting point was that no
financial provision had been made for C at all. She was 60 and had
lived with the deceased for five years, and they had contributed equally
to looking after their home together. C’s only source of income was
rental from her English property and a small pension, although she
would in due course receive a state pension. The sons were selfsupporting
adults.
Patel v Vigh [2013] EWHC 3403 (Ch).
In relation to an application under the 1975 Act, the judge held that an
unmarried couple who would otherwise be regarded as living as
husband and wife, would still be so regarded when one of the partners
was in hospital for two months before his/her death.
Children
Gold v Curtis (2004) 154 (7157) NLJ 1888; [2005] WTLR 673.
The court emphasised that the basis of the court’s jurisdiction is the
relief of financial need and not the achievement of equality or fairness
between competing children. The entire estate of £870,000 had been
left to a well-off daughter and nothing given to an adult son whose
financial position was perilous and whose pension provision was
inadequate. The son was awarded £220,000 to augment his income
and £30,000 as a capital sum.
Myers v Myers [2004] EWHC 1944; [2005] WTLR 851.
The testator was held not to have made reasonable financial provision
for his adult daughter’s maintenance where she was living in severely
straitened circumstances and her situation was a result of her awkward
personality and mental fragility rather than indolence. She had not
behaved as badly to her father as he seemed to believe and he had very
substantial wealth: the deceased had left his entire estate (of over £8
million) to his second family.
But note also:
Ilott v Mitson [2011] EWCA Civ 346; [2011] WTLR 779,
in which the Court of Appeal overruled the decision of Eleanor King J
(noted in the previous Update as H v Mitson [2009] EWHC 3114
(Fam); [2010] WTLR 193 (Fam Div)) and restored the decision of
the District Judge.
A mother disinherited her estranged daughter and left her entire
£486,000 estate to animal charities. Eleanor King J said that the
question was whether the provision made for the daughter by the
mother was (objectively) unreasonable. She held (overturning the
District Judge’s award) that it was not objectively unreasonable and so
the daughter was entitled to nothing. This tended to revert to the
approach taken in the earlier case of Coventry (1980) rather than the
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kinder (and possibly less logical) line in the later case of Espinosa
(1999).
The Court of Appeal allowed the daughter’s appeal, holding that the
value judgment made by the trial judge in determining whether the
financial provision resulting from a will was reasonable should not be
interfered with by an appellate court unless ‘plainly wrong’, and
reasserting that, in order to succeed under the Act, there was no need
for an adult child of the deceased to show that the deceased owed him
a moral obligation. It was plain that the District Judge had not erred in
law. He had asked himself the right question, namely whether having
considered all the s.3 factors the resulting lack of provision was
unreasonable. He had then proceeded to consider those factors
meticulously. The District Judge was not under an obligation to
‘balance’ the s.3 factors, or to explain why the particular combination
of factors led him to the conclusion that no provision was
unreasonable. That was a value judgment that the District Judge was
entitled to make and that exercise should not be interfered with by an
appellate court unless ‘plainly wrong’. The District Judge had to
exercise a discretion in deciding what, if any, relief to award, and did
so in the instant case, explaining fully and precisely the relief he was
awarding and why. Therefore, the criticism that he had not conducted
the necessary ‘balancing exercise’ was misplaced. There was plainly an
overlap between the value judgment that the provision was
unreasonable and the exercise of the discretion in making the award.
However, what mattered was that the decision taken as a whole
explained why the judge had reached the conclusion he had. An adult
child of the deceased did not have to show that the deceased owed him
a moral obligation or that there were other special circumstances in
order to succeed under the Act. Further, in deciding whether the
disposition of the deceased’s estate made reasonable provision for the
applicant, the trial judge was not exercising a discretion, but making a
value judgment based on his assessment of the factors in s.3(1).
Dependants
Baynes v Hedger [2009] EWCA (Civ) 374; [2009] 2 FLR 767.
The claimant failed both in the High Court and in the Court of Appeal,
but in the Court of Appeal it was on the ground that she did not even
have the standing to bring a claim, because the deceased had not
assumed responsibility for her. This is the approach taken by
Megarry V-C in Re Beaumont and appears harsher than that taken by
the Court of Appeal in Jelley v Iliffe.
Playforth, S. ‘Respecting our elders’ (2013) 163 New Law Journal
19
considers the difficult position in which parents of a deceased child can
find themselves, given the limitations of the rules about family
provision.
Law Commission Report 2011
As mentioned under Chapter 2 above, on 14 December 2011 the Law
Commission published a Report on Intestacy and Family Provision
Claims on Death (Law Com No 331), which followed the Consultation
Paper (CP No 191) noted in an earlier Update and which reviewed the
current law and discusses options for reform.
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The 271-page Report can be accessed via the Law Commission’s
website at:
www.justice.gov.uk/lawcommission/docs/lc331_intestacy_report.p
df
Along with a 5-page Executive Summary:
www.justice.gov.uk/lawcommission/docs/lc331_intestacy_summa
ry.pdf
The main recommendations of the Report in relation to the law of
family provision under the 1975 Act are broadly as follows:
In relation to provision for a surviving spouse, it is proposed that it
be made clear that the requirement to ‘have regard to’ what he/she
might reasonably have expected to receive on divorce (or
dissolution of a civil partnership) should not act as any kind of
limit (upper or lower) upon entitlement to family provision (paras
1.88, 2.146, 9.7).
In relation to a ‘child of the family’, it is recommended that this
class should not be limited to cases where the deceased was
married or in a civil partnership (paras 1.96, 6.41, 9.14).
Also, a ‘dependant’ should not be required to prove that the
deceased had ‘assumed responsibility’ for him/her, as distinct from
the fact of maintenance, or that the deceased contributed more to
the relationship, in terms of financial value (paras 1.96, 6.59, 6.76,
9.15-9.16) – a reform that would ‘open the door for claims in cases
of interdependence’.
There are significant recommendations in relation to cohabitants
(to mirror similar recommendations made in relation to the law of
intestacy), essentially by removing the requirement for
cohabitation for a two-year period where the cohabitants have
children. The proposal is that an application may be made by a
person who (1) was the father or mother of a child of the deceased
and (2) at the date of death was (a) living in the same household
as the deceased and (b) as the deceased’s spouse (para. 8.153).
It is recommended that the classes of potential applicants should
not be widened (para. 6.94).
There should be no change to the ‘maintenance’ standard of family
provision as it applies to children (paras 1.95, 6.26).
The domicile requirement should be reformed, so that an
application may also be made where English domestic succession
law applies to any part of the estate (paras 1.98, 7.17, 7.37, 9.18).
There are other, largely technical, proposals for reform, as set out
in the Report.
Candidates are strongly encouraged to familiarise
themselves with the recommendations of the Report and
also its full and helpful discussion of the issues examined.
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Chapter 7: Entitlement
7.4 Lapse
Rainbird v Smith (2012) 156(22) SJLB 31.
A will left the residuary estate to ‘upon trust for such of them, my
daughters, R, J and S, as shall survive me, and if more than one, in
equal shares absolutely’. One of the daughters predeceased the
testatrix. The question was whether s.33 of the Wills Act 1837 applied
so that the daughter’s surviving children could inherit under the will.
According to s.33, this will happen ‘unless a contrary intention shall
appear by the will’. The High Court held that the clear intention of the
testatrix was that the residuary estate should pass only to those of her
daughters who survived her. This was a clear intention that the rule in
s.33 of the 1837 Act should not apply. The residuary estate passed only
to the two surviving daughters, not the testatrix’s grandchildren.
7.6 Forfeiture
The Estates of Deceased Persons (Forfeiture Rule and Law of
Succession Act) 2011 came into force on 1 February 2012. The Act
inserts new sections into two existing statutes in relation to forfeiture.
For testate succession, the Wills Act 1837 now includes s.33A. By
this section, if the killer would have been entitled to receive
property under the victim’s will, but is precluded from doing so
due to the forfeiture rule, the killer will be treated as having
predeceased the victim. The rules of lapse and s.33 of the 1837 Act
will then apply.
For intestate succession, the Administration of Estates Act 1925
now includes s.46A. By this section, if the killer would have been
entitled to receive property under the victim’s intestacy, but is
precluded from doing so due to the forfeiture rule, the killer will
be treated as having predeceased the victim.
Chapter 8: Alternative succession
8.1 Privileged wills
Re Servoz-Gavin, Ayling v Summers [2009] EWHC 3168; [2010] 1
All ER 410.
This is a rare example of a reported case concerning a seaman’s
privileged will. The deceased was a ship’s radio officer and made the
will while ashore, but when under orders to join his ship. Will upheld.
8.2 Statutory wills
Re P [2009] EWHC 163 (Ch); [2009] 2 All ER 1198.
This was an application to the Court of Protection for the making of a
statutory will. It is the first reported case of such an application under
the Mental Capacity Act 2005. It was held that guidance under the
Mental Health Acts 1959 and 1983 was no longer directly applicable.
Under the 1983 Act, the court had to imagine that the patient had had
a brief lucid interval and had then to imagine what will he would have
made during that interval (the ‘substituted judgment’ approach).
Under the 2005 Act, the court had to work out not what the patient
might be expected to have done, but what was in his best interests (the
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‘balance sheet’ approach). It would be relevant to his best interests
how he would be remembered after his death.
Re M [2009] EWHC 2525 (Fam); [2011] 1 WLR 344.
The applicant property and affairs deputy (W) applied for an order
authorising him to execute a statutory will for the elderly second
respondent (M). M was a childless widow who lacked testamentary
capacity. She had, at different times, made wills in which she had left
most of her property to charities or her neighbour. She was later cared
for and lived with the first respondent (Z) and his family and during
that period she transferred significant sums to Z and, in 2004, made a
will under which he was the sole beneficiary and granted an enduring
power of attorney in his favour. W was later appointed to act for M and
by court order M was removed from Z’s address. Contrary to a court
order, Z failed to provide information concerning his receipt of M’s
money and was accordingly criticised by the court. The court later
directed that an interim will should be made for M and reviewed once
the beneficiaries under her previous wills had been notified. That
interim will reinstated the terms of a will made before M had lived
with Z and made provision for the charities and M’s neighbour. W and
M submitted that a statutory will under the Mental Capacity Act 2005,
s.18(1)(i) should be made for M in substantially the same terms as the
interim will. Z argued that a statutory will should be made in the same
terms as the 2004 will. W’s application was granted. Munby J followed
Re P, above, and held that decisions on earlier Acts should be
consigned to history. The starting point was the structured decisionmaking
process prescribed by the 2005 Act, a process which required
the decision-maker to take a number of steps before reaching a
decision, including encouraging the legator to participate in the
decision, considering his or her past and present wishes, beliefs and
values, and taking into account the views of third parties as to what
would be in the legator’s best interests. There was no place in that
process for reference to judicial decisions under the earlier and very
different statutory schemes.
The Act laid down no hierarchy as between the factors which had to be
borne in mind, beyond the overarching principle that what was
determinative was the judicial evaluation of what was in the
individual’s best interests. The weight to be attached to the factors
would differ depending upon the individual circumstances of the
particular case but there might be one or more features which were of
magnetic importance in influencing or determining the outcome. The
individual’s wishes and feelings were a significant factor to which the
court had to pay close regard. The weight to be attached to those
wishes and feelings was always case-specific and fact-specific and in
considering their weight and importance, as required by s.4(2), the
court had to have regard to all the relevant circumstances. That
included the degree of the individual’s incapacity, the strength and
consistency of the views they expressed, the possible impact on the
individual of knowledge that their wishes and feelings were not being
given effect to, the extent to which their wishes and feelings were, or
were not, rational, sensible, responsible and pragmatically capable of
sensible implementation in the particular circumstances and, crucially,
the extent to which those wishes and feelings, if given effect to, could
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properly be accommodated within the court's overall assessment of
what was in their best interests.
Re D [2010] EWHC 2159 (Ch); [2010] WTLR 1511.
This is a case where the Court of Protection ordered the execution of a
statutory will in 2010 to undo the effect of two earlier wills made in
2004 and 2006 when the testatrix probably lacked capacity. The
statutory will was on the same terms as a will which the testatrix had
made in 1995 when she did clearly have capacity. In other words, the
statutory will was used to undo the effect of two ‘suspicious wills’.
Compare this case with Re Davey (1981) where a statutory will was
executed to undo the effect of a marriage which should not have taken
place.
NT v FS [2013] EWHC 684 (COP); [2013] WTLR 867.
A case about making a statutory will. The court repeated the obligation
under the 2005 Act to act in the individual’s best interests, rather than
following their wishes. However, the court also observed that s.4(6)(a)
of the Mental Capacity Act 2005 requires the person making decisions
for someone lacking capacity to take into account the past wishes of
the individual in question. In this case, that meant that a document
made when the individual possessed capacity, which purported to be a
will (but was invalid), was relevant to the decision-making process.
However, this document was not of especially great weight as it was
unwitnessed and was 26 years old, during which time there had been
considerable changes in the individual’s life.
8.3 Mutual wills
Carvel Foundation v Carvel [2007] EWHC 1314 (Ch); [2007] 4 All
ER 81.
This case held that mirror-image wills made by a husband and wife,
which they had agreed not to alter or revoke, had been mutual. The
husband and wife had agreed, at the time they made their wills, that
neither would make any gratuitous transfers during their joint lives,
unless the other agreed, and that the survivor would make no
gratuitous transfers. This was an unusually clear case of mutual wills.
Charles v Fraser [2010] EWHC 2154 (Ch); [2010] WTLR 1489.
This is said to be only the third contested mutual wills case in England
in the last 80 years. Most mutual wills cases involve married couples,
but this case concerned two widowed (childless) sisters whose wills
were in favour of family members. The trial judge (quite correctly)
criticised the draftsman of the mutual wills for not making a clear note
of the fact that they were mutual, and for not including a recital of it in
the wills.
Fry v Densham-Smith [2010] EWCA Civ 1410; [2011] WTLR 387.
A decision that an oral agreement for mutual wills had been made and
acted upon would not be set aside where the trial judge had produced
a sound judgment which had not strayed beyond the boundaries of
solid evidence into the realms of surmise and speculation, which had
made reasonable and proper inferences from the facts, events and
circumstances and which did not contain any misdirection of law. The
judge found that D and H had executed mutual wills pursuant to an
oral agreement so that on H’s death an irrevocable trust took place and
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that on D’s death some 15 years later the trust was binding on her
estate. Under that trust M and F were entitled to an equal half share of
D’s net estate. However, under the last of three non-mutual wills made
by D after H’s death, F was the sole executor and beneficiary. F
appealed against the findings of the judge on the basis that they were
not supported by the evidence and that M was not entitled to any share
in D’s estate.
The Court of Appeal dismissed the appeal, holding that, despite the
deficiency of direct evidence and the piecemeal nature of the evidence
relied on by the judge for his conclusion, this did not defeat M’s claim
or undermine the judgment. The judge had made reasonable and
proper inferences from the facts, events and circumstances about what
had probably been arranged and agreed between H and D, and had
satisfactorily explained his reasoning. The result was a sound judgment
which had not strayed beyond the boundaries of solid evidence into
the realms of surmise and speculation. The instant court should not
interfere with it. It did not contain any misdirection of law nor could it
be said that the key findings were contradicted or unsupported by
evidence or based on inferences so improbable that no reasonable
judge could have made them. (It must be questioned, nonetheless,
whether this enables a mutual will to be proved rather more easily
than has been the case in the past. Strong, almost irrefutable proof,
seems to have been looked for in earlier decisions, but clearly not in
this case.)
8.6 Donatio mortis causa
Vallee v Birchwood [2013] EWHC 1449 (Ch); [2013] WTLR 1095.
A case which applied Sen v Headley, recognising the validity of a
donatio mortis causa of land. ‘Dominion’ could be given by handing
over of the keys and title deeds to the deceased’s house; these
restricted what the deceased could do with the property. The
deceased’s continued use of the property did not invalidate the gift.
The only other question was whether the gift was made in
contemplation of death. The deceased made the gift in August, saying
that he did not expect to be alive much longer and might not be alive
by the donee’s next visit at Christmas. The deceased died in September.
The court held that this four month gap between the gift and death
was acceptable – the question is not whether the deceased had good
grounds for expecting death, but whether the motive for the gift was
the deceased’s subjective contemplation of his/her death in the near
future.
Roberts, N. ‘Donationes Mortis Causa in a dematerialised world’
(2013) 77 Conv 113–28.
An excellent article discussing the difficulties in applying the rules of
donationes mortis causa, especially those of indicia of title, to modern
contexts
There have been a number of reported cases where lack of capacity
and/or lack of knowledge and approval have been pleaded. There is
often overlap between questions of capacity and knowledge and
approval. However, lack of knowledge and approval is more often
raised when there are ‘suspicious circumstances’ and it appears that it
is often pleaded as a way of hinting at undue influence or fraud
without actually pleading either of these.
The following cases have raised the issue of lack of capacity.
In: Hoff v Atherton [2004] EWCA Civ 1554; [2005] WTLR 99,
Banks v Goodfellow was applied. Although the testatrix suffered from
dementia and the burden of proving capacity rested on the defendant,
and although the defendant’s involvement in the preparation of the
will also required proof that the testatrix had knowledge and approval,
the will was valid. The Court of Appeal stated that the test of capacity
was issue-specific (i.e. it must be considered in relation to the particular
transaction, its nature and its complexity). The will was a
straightforward one and it had been witnessed by an independent
solicitor.
Schrader v Schrader [2013] EWHC 466 (Ch); [2013] WTLR 701.
The testatrix made a new will in 2006 (revoking an earlier will), which
left her house to one of her sons and divided the residue of her estate
equally between her two sons. Her previous will had divided the entire
estate equally between her two sons. The son receiving the house lived
with the testatrix. The 2006 will was challenged on the basis of lack of
capacity, lack of knowledge and approval and undue influence.
Lack of capacity was argued on the basis that the testatrix did not
know the value of her house. This was not sufficient to indicate a lack
of capacity. Many testators would not know the value of their home,
but such knowledge was not required for capacity. Appreciating that
the house was probably the most valuable asset by a long way was
sufficient.
The only other argument was that changing the division of
assets between the sons was odd. The court stressed (para.[82]) that
‘[t]estators do strange things and are entitled to be whimsical,
capricious, vindictive, wrong in belief or their acts beyond explanation
without that of itself proving lack of capacity (though those factors
may contribute to a bigger picture demonstrating it).’
Sharp v Adam [2006] EWCA Civ 449; [2006] WTLR 1059.
The Court of Appeal upheld the decision of the trial judge to the effect
that the testator, who had made his will while in the final stages of
severely debilitating progressive multiple sclerosis, had ‘crossed an
imprecise divide’. He lacked the capacity to arrive at a rational
judgment and there had been an inexplicable poisoning of his affection
for his daughters.
Kostic v Chaplin [2007] EWHC 2298 (Ch).
The deceased, who died in 2005, had made a will in 1988 and another
in 1989, both in favour of the Conservative Party. His son, who had
benefited under earlier wills, alleged lack of capacity. It was common
ground that, from the 1980s, the deceased had suffered from a mental
illness which caused him to believe that members of his family were
implicated in an international conspiracy of dark forces against him. It
was held that the deceased’s natural affection for his son had been
poisoned by his delusions. Banks v Goodfellow applied. The deceased
lacked testamentary capacity when he made the 1988 and 1989 wills
and so his £8,000,000 estate passed to his son.
Re Loxston [2006] EWHC 1291; [2006] WTLR 1567.
A will prepared by a professional will draftsman for a 97-year-old
woman, against whom an enduring power of attorney had been
registered, was refused probate on the ground that the woman lacked
capacity. The draftsman had been summoned by the woman’s carer
and the will was (to a significant extent) in the carer’s favour. Some
may wonder why such a will was set aside for lack of capacity rather
then undue influence. Could not undue influence be presumed? The
standard response is that it could not, but it does seem odd that it is so
difficult to set such a will aside. The final result in this case, the setting
aside of the will, must be correct, but the costs of the case would have
been significant and (although this is not mentioned in the report) will
almost certainly have come from the estate.
Blackman v Man [2007] All ER (D) 118; [2008] WTLR 389.
A childless widow left her estate to a couple from a Chinese takeaway
who had befriended her. The will was challenged by nephews and
nieces, but there was not sufficient evidence of lack of capacity and the
will was upheld.
Couwenbergh v Valkova [2008] EWHC 2451 (Ch).
A series of wills made by a 90-year-old testatrix, by which she excluded
her family who had been beneficiaries under an earlier will in favour of
a woman who had power of attorney for her, were duly executed, but
were invalid because she did not have testamentary capacity due to her
moderate to severe dementia. The solicitor involved did not actually
meet the deceased and was not present at the execution of any will.
Re Ritchie, Ritchie v Nat Osteoporosis Soc [2009] EWHC 709 (Ch).
The will, which was prepared by a solicitor and witnessed by a doctor
(thus abiding by ‘the golden rule’), disinherited the testatrix’s
children and left all her property to charity. It was refused probate on
the ground that the testatrix suffered from paranoia and had been
subject to delusions.
Re Perrins, Perrins v Holland [2010] EWCA Civ 840; [2011] Ch
270; [2010] WTLR 1415,
is a Court of Appeal case upholding the trial judge in applying the rule
in Parker v Felgate. This seems to be the first case where Parker v
Felgate has come before the Court of Appeal. But the problem with this
particular case is that the instructions for the will were given more
than a year before the will was executed and the beneficiary acted as
link between the testator and the solicitors who drafted the will. On
the particular facts, it may have been generous of the court to uphold
this will.
Cowderoy v Cranfield [2011] EWHC 1616 (Ch); [2011] WTLR
1699.
The deceased, who died at the age of 85 or 86 (there was some
uncertainty about her date of birth) suffered from progressive vascular
dementia in her final years. Her will was made some two years before
she died. In it she appointed D as her sole executor and left her entire
estate to him. Her son, who had been living with her, had died roughly
three months before she made her will. He died intestate so that his
estate passed to C. The evidence indicated that X was unhappy about
this. Her son was an alcoholic. D got to know X as he was a friend of
another alcoholic who drank with X’s son. D began to visit and care for
X in the period before she made her will. C argued that X did not have
testamentary capacity to make the disputed will, that she did not know
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and approve its contents and that it had been procured by undue
influence on D’s part. However, it was held (following Hoff v Atherton
and Re Perrins above) that the evidence justified the conclusion that
the deceased had testamentary capacity when she gave instructions for
her will and when she executed it, even though her condition
fluctuated at the time. She understood the extent of the property which
she was disposing of and was able to comprehend and appreciate the
claims to which she felt she ought to give effect. She was clear and
settled in her mind that she did not want C to benefit. She decided to
leave her entire estate to D not only because of what he had done for
her but also because she considered that leaving her estate to him
would improve the chance that he would continue to help her in the
future. Further, she knew and approved the terms of the will.
See also Gill v Woodall below.
Re Wilson [2013] EWHC 499 (Ch); [2013] WTLR 899.
The testatrix apparently made a will at home leaving her property to a
husband and wife unrelated to the testatrix. The beneficiaries had
assisted her in her old age. The husband had drafted the will for the
testatrix. In relation to capacity, it was held that the testatrix was
suffering from an ‘affective disorder’ brought on by bereavement,
something to which the testatrix consistently had a strong reaction.
The trial judge was clear that the test for capacity in s.2 of the Mental
Capacity Act 2005 (‘a person lacks capacity in relation to a matter if at
the material time he is unable to make a decision for himself in
relation to the matter because of an impairment of, or a disturbance in
the functioning of, the mind or brain’) was ‘more expressly tailored’ to
the facts of this case, but no argument was heard about whether this
test was different to the common law test in Banks v Goodfellow. The
testatrix was found to lack capacity.
In relation to knowledge and approval, as the drafter of the will was
(with his wife) the sole beneficiary of the will, this was ‘the clearest
possible example of a situation where the court should be vigilant and
jealous in examining the evidence in support of the instrument’ and
insufficient evidence was presented to show that the testatrix did know
and approve of the contents of the will.
Re Dharamshi [2013] EWHC 3917 (Ch).
In this case a testator was not found to lack capacity, despite a ‘severe
bereavement reaction’ to his wife’s death. In this case the will made
while bereaved reflected the testator’s true wishes, the testator knew
what he was doing and wanted to achieve and appeared to be fully in
charge of his mental faculties. In comparison to Re Wilson, above, the
main difference seems to be that while the testator here was bereaved,
that bereavement had not led to an ‘affective disorder’ affecting
capacity as in the Mental Capacity Act 2005, nor was there a disorder
of the mind affecting the testator’s recognition of claims upon him.
Burgess v Hawes [2013] EWCA Civ 94; [2013] WTLR 453.
The testatrix made a will in 1996 in which her residuary estate was to
be divided between her three children. In 2007, she made a new will,
dividing her residuary estate between only two of the three children.
The solicitor involved in drafting the will was experienced and noted
that the testatrix was ‘entirely compos mentis’, albeit with no formal
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assessment of the testatrix’s capacity. The will was explained to the
testatrix before execution. The appellant (one of the children entitled
under both wills) was in the room for both meetings with the solicitor.
The 2007 will stated that no financial provision was made for the
testatrix’s third child because of substantial lifetime provision that had
been made or would shortly be made, on the basis of inaccurate
information provided by the appellant to the solicitor. The trial judge
found that the testatrix lacked testamentary capacity under Banks v
Goodfellow: The testatrix knew she was making a will and appreciated
the extent of her property, but was incapable of understanding the
claims to which she ought to give effect (on the basis of evidence of
vascular dementia). The testatrix also lacked knowledge and approval
of the contents of the 2007 will. The appellant appealed, and the
appeal was rejected. The will was found to be invalid on the basis of a
lack of knowledge and approval. The case also considered questions of
capacity, and doubted the trial judge’s conclusion on this issue,
although the Court of Appeal declined to express a concluded view.
Mummery LJ stated at para.[60] that ‘the courts should not too readily
upset, on the grounds of lack of mental capacity, a will that has been
drafted by an experienced independent lawyer. If, as here, an
experienced lawyer has been instructed and has formed the opinion
from a meeting or meetings that the testatrix understands what she is
doing, the will so drafted and executed should only be set aside on the
clearest evidence of lack of mental capacity.’ The other members of the
Court of Appeal agreed. This is not a new rule of law, but rather an
evidential issue: the solicitor will usually be in a better position than
the court to assess capacity. In this case the solicitor said that he would
have required medical evidence of capacity if he had any doubts. The
Court of Appeal was also sceptical about the value of medical evidence
from a doctor who had never met the testatrix and based his evidence
solely on the testatrix’s medical notes. Mummery LJ noted more
generally (para.[13]): ‘if a properly executed will has been
professionally prepared on instructions and then explained by an
independent and experienced solicitor to the maker of the will, it will
be markedly more difficult to challenge its validity on the grounds of
either lack of mental capacity or want of knowledge and approval than
in a case where those prudent procedures have not been followed.’
Tociapski v Tociapski [2013] EWHC 1770 (Ch); [2013] WTLR
1821.
A demonstration of how capacity and knowledge and approval issues
can interact. The testator in this case suffered from medical conditions
which may have impaired his capacity. There were also questions
about whether the testator knew and approved of the contents of the
will and/or undue influence. The trial judge held that there was
insufficient evidence to prove that the testator lacked testamentary
capacity entirely, but there was sufficient evidence to show that the
testator’s capacity to know and approve of the contents of the will may
have been ‘adversely affected’. When combined with various other
factors (such as provisions in the new will being ‘out of character’; not
following a fairly consistent earlier practice in the testator’s wills and
that the beneficiary of the new will may have kept the testator
isolated) the suspicion of the court was aroused and it was not then
shown that the testator knew and approved of the contents of the will.
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Following the finding of lack of knowledge and approval, the judge did
not consider undue influence.
Simon v Byford [2013] EWHC 1490 (Ch); [2013] WTLR 1615 (an
appeal is outstanding).
The testatrix was an elderly lady suffering from mild-moderate
dementia which varied to some extent in its effects; there were ‘good
days’ and ‘bad days’. The testatrix’s will was challenged on the basis of
lack of capacity. The court held that the will was executed on one of
the testatrix’s ‘good days’ and that she understood the nature of a will,
the arrangements she was making, the scope of her property and the
claims other people had upon her. Despite her illness she therefore had
capacity on the day the will was made. The case highlights how
dependent decisions about lack of capacity are upon the very precise
facts, and even the presence of a recognised illness which would often
affect capacity will not automatically lead to a finding of a lack of
capacity.
On the topic of presumptions and so on, you may wish to read the
following article:
Ridge, P. ‘Equitable undue influence and wills’ (2004) 120 LQR
617.
The cases on lack of knowledge and approval follow on from
this.
Reynolds v Reynolds [2005] EWHC 6.
Although the elderly testatrix had testamentary capacity at the time of
making her will, and it had been validly executed, the defendant failed
to discharge the burden, cast on him due to the suspicious
circumstances, of proving that the testator knew and approved its
contents. This is a case where the will was prepared by a draftsman
who stated that he had taken instructions from the testatrix. The trial
judge (Rimer J) did not believe the draftsman. The judge held that the
draftsman must have taken his instructions from the beneficiary.
Franks v Sinclair [2006] EWHC 3365 (Ch); [2007] WTLR 439.
This case involved a solicitor who drafted a will for his mother (with
whom he was not on good terms). The will left half her estate to him
and its execution was witnessed by one of the solicitor’s son’s partners
and a secretary from his office. It was held that the testatrix had not
known and approved of the contents of the will.
This is another case, like Wintle v Nye, where it is hard to see why the
plea was not fraud (rather than lack of knowledge and approval). If
the solicitor drafted a will for his mother, in which she left property to
him, and he then arranged for her to execute it, when she did not
understand its contents, surely this was fraud. The solicitor involved
has since appeared before a Disciplinary Tribunal and has been fined
(£5,000 plus costs), but some may be surprised that the penalty was
not more severe.
Re Rowinska [2005] EWHC 2794; [2006] WTLR 487.
A testatrix aged 87 with a poor command of English was held not to
have known and approved of the contents of a will which purported to
leave her entire estate to the claimant beneficiary. The beneficiary had
prepared the will and friends of his witnessed it.
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Devas v Mackay (also known as Re D) [2009] EWHC 1951 (Ch);
[2009] All ER (D) 09.
A testatrix who had suffered several strokes was held not to have
known and approved of the contents of a will which left her estate to
the son of her carer. It seems that, after this civil case was over, those
who had prepared the will were charged with a series of criminal
offences and that they pleaded guilty to forgery. But, in that case, why
did those who attacked this will in the civil proceedings not do so on
the ground of forgery? It should be easier to prove forgery in civil
proceedings than in criminal proceedings. Those who attack ‘suspicious
wills’ always seem very reluctant to allege misbehaviour and this is a
very clear example.
Gill v Woodall (also known as Gill v RSPCA) [2010] EWCA Civ
1430; [2011] Ch 380.
The deceased (M) and her husband (F) had executed mirror wills
which excluded G, their only child, stating that she had already been
well provided for. F predeceased M and when M died the RSPCA was
the sole beneficiary of her estate. G contested the validity of the will,
arguing that M had not known or approved of the terms of the will. M
had suffered from agoraphobia, which caused her extreme anxiety
when leaving home and/or when in contact with strangers. The court
adopted a two-stage process to the question of whether M had known
and approved of the contents of the will. It found that there was a
prima facie case that M had not known and approved the contents but
also found that that case had been rebutted as F and M had both
attended meetings with solicitors to give instructions and for the wills
to be read, confirmed and signed, and a draft will had been sent to
their home for consideration. However, the court also found that M
had executed her will under undue influence from F and revoked the
will. The Court of Appeal dismissed the RSPCA’s appeal. The judge had
been right, or at least entitled, on the evidence before him to conclude
that G had made out a prima facie case that M had not known or
approved of the contents of the will when she signed it. However, the
judge was wrong, and not entitled to conclude that the RSPCA had
rebutted that case. If the judge had approached the question of
knowledge and approval as a single issue, he might have reached the
right conclusion. It did not seem wise, particularly where there were a
large number of witnesses heard over many days, to consider an issue
in two stages when those stages ultimately involved the same
question, namely whether M had appreciated what was in the will
when she signed it.
Greaves v Stolkin [2013] EWHC 1140 (Ch); [2013] WTLR 1793.
Another case in which capacity and knowledge and approval was
raised. The elderly testator used a solicitor to make a codicil to his will,
making provision for his long-term partner. This codicil was very
similar to an earlier purported codicil which was not legally
enforceable. One of the testator’s sons challenged the validity of the
codicil on the basis of capacity and lack of knowledge and approval. In
relation to capacity Newey J repeated the view of Mummery LJ in
Burgess v Hawes, that where an experienced solicitor regarded the
testator as possessing capacity, it would be rare for the court to reject
that. Newey J considered that the testator had capacity. Newey J
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stressed the approach taken in Gill v Woodall (above), that in assessing
lack of knowledge and approval, there is no need to follow a distinct
two-stage test of finding suspicions aroused, followed by a reversed
burden of proof (although also acknowledging that this approach had
been applied in Burgess v Hawes). The question is simply whether the
person seeking to rely on a purported testamentary disposition has
discharged the burden of establishing that the testator knew and
approved of the contents. In this case, the role of the independent
solicitor made it unlikely that the testator lacked knowledge and
approval (citing a remark by Mummery LJ at para.[13] in Burgess v
Hawes). The codicil was therefore valid.
Cushway v Harris [2012] EWHC 2273 (Ch).
Harris, a solicitor, drafted wills for his two elderly aunts. Their earlier
wills had left their property to each other, but in these wills one third
of the residuary estate was left to Harris, who was also appointed
executor. It was alleged by the claimants that the testatrices lacked
knowledge and approval of the wills. The court observed that in this
case both testatrices were elderly, in poor health and one may have
lacked testamentary capacity. The suspicion of the court was raised,
and Harris did not appear to try and prove knowledge and approval.
The court directed that the papers be sent to the Director of Public
Prosecutions to consider whether any further action should be taken
against Harris. This final step suggests although the case was pleaded
as concerning lack of knowledge and approval, the court considered
the case to be one of fraud. However, fraud was not pleaded.
Then, contrast Reynolds, Franks, Rowinska and Devas with:
Sherrington v Sherrington [2005] EWCA Civ 326; [2005] 3 FCR
538; [2005] WTLR 587,
where the Court of Appeal allowed an appeal against the judgment of
Lightman J. The court held that the testator, a solicitor, had known
and approved of the contents of a simple will prepared for him by his
non-legally qualified stepdaughter. In it he left his entire, and
substantial, estate to his second wife, his stepdaughter’s mother, so
disinheriting the adult children of his first marriage, with whom he was
on good terms. The facts of this case are unusual, but, given the result,
it must be asked whether it was the correct approach to attempt to
attack this will on the ground that the testator lacked knowledge and
approval. It may well have been a way of hinting at undue influence
without formally alleging it, but, if it was, it did not work. Would the
children have stood a better chance of success had they
straightforwardly alleged undue influence?
See also:
Gill v Woodhall, above (where, in the event, the Court of Appeal
held it was unnecessary to consider the issue of undue influence).
Cowderoy v Cranfield, above.
Hubbard v Scott [2011] EWHC 2750 (Ch); [2012] WTLR 29.
An allegation that a sole beneficiary under a will unduly influenced a
testator was not established where there was no evidence that the
beneficiary had so victimised, dominated or coerced the testator as to
overbear his volition. The testator executed his final will in 2009, in
which he left his entire estate to K, his cleaner. He died 11 days after
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its execution. In the instant proceedings, much of the disputed
evidence was concerned with the length and nature of the relationship
between K and the deceased, the allegation being that it was unlikely
that he would have left his entire estate to K, and that K must have
exerted undue influence over him when he made his final will. The will
was upheld. The court held that, as there was no presumption of
undue influence in cases of testamentary gifts, the test to be applied
was more stringent than that laid down in Royal Bank of Scotland Plc v
Etridge (No 2) [2001] UKHL 44; [2002] 2 AC 773. In discharging the
evidential burden of establishing undue influence, victimisation,
domination or coercion needed to be established and it had to be
shown that W’s final will was not the offspring of his own volition.
Wharton v Bancroft [2011] EWHC 3250 (Ch).
The deceased, who was terminally ill, made a will in contemplation of
his intended marriage to M, leaving the entirety of his substantial
estate to her. M was his partner of 32 years. The will was prepared by
his solicitor and read to him. M was not present when he gave
instructions. Immediately after making the will, he married M. He died
a couple of days later. His children from his first marriage and a child
from an extra-marital relationship challenged the will, asserting that it
was obtained as a result of M’s undue influence. It was held (applying
Cowderoy v Cranfield, above) that the execution of a will as a result of
undue influence was a fact that had to be proved by those who
asserted it. On the evidence, the death-bed will in favour of M could
not be explained as the result of coercive pressure which deprived him
of free choice. He had understood that by giving ‘all to M’, he was not
giving anything to anybody else. The will-making process resulted in a
document containing the last true wishes of a free and competent
testator.
Re Edwards [2007] EWHC 1119 (Ch); [2007] WTLR 1387.
This is one of the very few reported cases where undue influence has
been pleaded and the plea has succeeded. This was undue influence by
an adult child over his aged mother.
Schrader v Schrader [2013] EWHC 466 (Ch); [2013] WTLR 701.
A very unusual case in which a plea of lack of knowledge and approval
failed, but one of undue influence succeeded. There was no direct
evidence of pressure on the testatrix, but sufficient circumstantial
evidence to support a finding of undue influence. The judge said
(para.[56]):
‘[t]here is absolutely no question of his physically abusing his mother
(no one even began to suggest that) but I consider that his physical
presence and personality around the house would be likely to produce
a significant degree of subservience in an anxious, dependent,
increasingly frail elderly lady in his care. I am in no way finding abuse.
I am sure that he was a caring son who tended to his mother's needs.
However, it is entirely plausible that he would get cross with her from
time to time and that she should be anxious about him and anxious to
please.’
This is not especially strong evidence of undue influence, given the
high threshold. Several of the factors outlined by the court would more
usually lead to a finding of a lack of knowledge and approval on the
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basis of a suspicious will. The court did consider this issue (at
para.[92]), but thought that the testatrix’s actions in amending the
draft will (she entered the name of a charity to receive a gift) showed
that she knew and approved of the contents.
The following two cases show that draftsmen have to take care about
getting involved with suspicious wills. In:
Sifri v Clough & Willis [2007] EWHC 985 (Ch); [2007] WTLR
1453,
the solicitor who drafted the will had to pay part of the costs of action
to set it aside. He had taken instructions directly from a beneficiary.
And in:
Re Key, Key v Key [2010] EWHC 408 (Ch): [2010] 1 WLR 2020,
the will made by an 89-year-old man in the week after his wife’s death
was set aside for lack of capacity and lack of knowledge and
approval. Briggs J criticised the solicitor who had drafted the will for
failing to follow the ‘golden rule’ (which says that a doctor should be
present if there are doubts about capacity). This was particularly
foolish of the solicitor, as the will was quite different from earlier wills
and benefitted mainly the testator’s daughters (who were present
when the instructions for the will were given) rather than his sons
(who were not present). The reference to the ‘suspicious
circumstances’ rule in this case appears to be a clear reference to
pressure put on the testator by his daughters.
Then there are the cases on lack of due execution.
Sherrington v Sherrington, above,
was a case which also involved an allegation of lack of due execution
and, on this point also, the Court of Appeal allowed an appeal against
Lightman J’s decision and held that the will had been properly
executed. It is easier to sympathise with the Court of Appeal’s decision
on this point than it is in relation to lack of knowledge and approval.
The Court of Appeal was satisfied that the witnesses had signed the
will with the intention of attesting the testator’s signature or of
attesting the will (Re Beadle [1974] 1 WLR 417 approved). When a will
contained the signatures of the deceased and the witnesses and an
attestation clause, the presumption of due execution would prevail
unless there was the strongest evidence that the witnesses did not
intend to attest. The will was upheld.
Channon v Perkins [2005] EWCA Civ 1808; [2006] WTLR 425.
The Court of Appeal considered and applied Sherrington. The will
appeared on its face to have been properly attested. The witnesses
accepted that the signatures on the will were theirs, but had no
recollection of having attested it. The Court of Appeal held that the
trial judge had been wrong to refuse probate. The strongest evidence
was required to rebut the presumption of due execution.
Channon was followed in:
Re Morgan, Griffin v Wood [2008] WTLR 73.
See also:
Couwenbergh v Valkova, above,
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where, in addition to rejecting the allegation of incapacity, the court
also held that, despite the fact that the evidence of the one living
witness being contradictory, it fell far short of the ‘strongest evidence’
required (according to Sherrington v Sherrington, above) to rebut the
presumption of due execution.
Re Rawlinson, Kayll v Rawlinson [2010] EWHC 1269 (Ch); [2010]
WTLR 1443 (Ch D),
where there was a (basically factual) dispute as to whether the testator
had acknowledged in the presence of both witnesses. Held, as a matter
of fact (not a question of a presumption), that he had. The judge in this
case followed the line that the testator does not need to do much in
order to acknowledge. It is suggested that this is the correct approach.
Kentfield v Wright [2010] EWHC 1607 (Ch).
A will which was regular on its face and contained an attestation
clause stating that it was signed in the presence of two witnesses was
held to have been properly executed in accordance with the attestation
clause. The evidence to suggest that only one witness had been present
at the time was not strong enough to rebut the presumption of due
execution. (Sherrington v Sherrington, above, applied.)
However, there are several recent examples of cases where wills have
been set aside for lack of due execution:
Barrett v Bem [2012] EWCA Civ 52.
A will was not validly executed under the Wills Act 1837 s.9(a) where
a testator, having expressly stated a desire to make a will, and
approving its contents, allowed the sole beneficiary under the will to
sign on his behalf after the testator attempted and failed to sign the
will himself. The Court of Appeal firmly rejected the argument that
because the testator had not objected to the beneficiary signing on his
behalf, the testator had directed the beneficiary to do so. The
requirement of signing at the testator’s direction in s.9(a) required a
positive action by the testator. In this case the testator had not
positively requested the beneficiary to sign on his behalf. The Court of
Appeal observed, obiter, that despite s.15 of the 1837 Act expressly
rendering a gift to an attesting witness ‘utterly null and void’, there
was no statutory provision to cover the situation in the instant
proceedings, and it could not properly be found that the gift was void
on that basis..
Re Papillon [2006] EWHC 3419 (Ch); [2008] WTLR 269.
This is a case where the beneficiary prepared the will, but she was
caught out because of her poor command of English.
Lim v Thompson [2009] EWHC 3341; [2010] WTLR 661.
A purported will containing a photocopied signature of a testator and
original signatures of two witnesses did not amount to a document that
had been signed by the testator at all in accordance with the Wills Act
1837 s.9 and was therefore not valid. There were several purported
wills here, but none of them was valid. One will had been attested by
only one witness; there was no evidence, in relation to another, that
the deceased had signed or acknowledged his signature in the presence
of both witnesses (and one witness had apparently not signed it until
after the deceased had died); and, as to a third will, the most that
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could be said was that the witnesses had attested a copy of a copy of a
will. A photocopy of a previous version of a will with a photocopied
signature of the testator was not a document which was signed by the
testator at all. It did not matter whether the signature was attached in
the presence of the witnesses or merely acknowledged in their
presence but it did have to be an original signature so that the court
could examine it and properly evaluate the evidence as to due
execution. Furthermore, the circumstances in the case were so
suspicious that no presumption of due execution arose.
Re Singh (Deceased) [2011] EWHC 2907 (Ch); [2012] WTLR 1.
A will was invalid where there was evidence of sufficient strength to
rebut the presumption of due execution arising from the witnesses’
signatures appearing together with an attestation clause. Here, the first
witness to the will maintained that he did not recall signing S’s will but
remembered an occasion when he had witnessed S’s signature on a
document when there had been no one else present. He also
maintained that he had never spoken to or met the second witness. It
was held (following Channon v Perkins, above) that there was a sliding
scale according to which evidence would constitute the strongest
evidence necessary to rebut the presumption of due execution in any
particular case. The burden had been satisfied here. The overall
probability was that the witnesses had signed separately. The evidence
relied upon in previous authority (specifically, Sherrington v
Sherrington, Channon Perkins, Couwenbergh v Valkova, and Kentfield v
Wright, above) where the presumption of due execution had not been
rebutted, fell well short of the evidence available to rebut the
presumption in the instant case.
Note also the unusual case of:
Marley v Rawlings [2014] UKSC 2.
A mirror will which had been signed in error by the wrong spouse did
not fail for want of formalities. In executing their mirror wills, both X
and Y had mistakenly executed each other’s will. The error went
unnoticed both at the time of execution and on the death of Y: it was
not until X’s death that the error was discovered. The testator signed
the document and intended to give it effect by his signature. The
signature requirements of s.9 of the Wills Act 1938 were satisfied
(paras.[57]–[59]). However, the contents of the will still lacked
knowledge and approval. The will was nevertheless capable of being
rectified (see below).
Rectification
Returning to another aspect of the plea of lack of knowledge and
approval, the plea covers cases of mistake (and may well be applied
more logically in cases of mistake than in cases where there has been a
suspicion of misbehaviour).
Where there has been a mistake, a will may be rectified under s.20 of
the Administration of Justice Act 1982, but only if there has been a
clerical error or a failure to understand the testator’s instructions.
Re Martin, Clarke v Brothwood [2006] EWCA 2939 (Ch); [2007]
WTLR 329.
A solicitor included in a will the words ‘twentieth shares’ when the
testatrix really intended ‘twenty per cent shares’. It was not clear how
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the error had come to be made, but, on the assumption that the
testatrix had used these words and the solicitor had inserted them
without realising that they did not make sense, the trial judge thought
that this was a ‘clerical error’. But was it? See casenote by R. Kerridge
and A.H.R. Brierley in [2007] Conv at pp.558–63.
Martin v Triggs Turner Barton [2009] EWHC 1920 (Ch); [2009]
WTLR 1339.
This is also a rectification case, where it was held that the draftsman
had failed to understand his instructions. The draftsman was a solicitor
who denied that he had so failed, but the court did not accept his
version of events. This case demonstrates that it is essential for
professional will draftsmen to keep full attendance notes of their
instructions.
Gerling v Gerling [2010] EWHC 3661; [2011] WTLR 1029.
A will which created a partial intestacy by failing to appoint
remaindermen on the termination of a trust created in relation to half
share in the residuary estate was capable of being rectified under s.20
where to do so would not substantially prejudice the beneficiary
affected and where there was nothing to indicate any intention by the
testatrix to leave part of her estate undisposed of by her will. This case
also addressed the issue of applications for rectification made out of
time (as to which, see below).
Re Bimson [2010] EWHC 3679 (Ch).
It was plain that the testatrix intended that her trustees should have
power to advance capital to a particular beneficiary during his lifetime,
and it was assumed to be her wish that the power should be exercised
in order to ensure that he always had sufficient to meet his needs.
However, as the will stood, he had only a bare life interest and the
trustees had no power to release or advance capital to him. The will
was rectified accordingly.
Austin v Woodward [2011] EWHC 2458 (Ch).
A claim for rectification of a will was granted under s.20 where there
was clear evidence that the misuse of new precedents had led to the
testatrix’s intention that a beneficiary take a property absolutely not
being reflected in that will. It was clear in the light of the evidence that
the will as currently drawn did not reflect her intentions. It was plain
that the impugned provision of the will had been based on a new
precedent which had been used without any thought given to the
impact that that might have on the relevant disposition. There was no
doubt that an error of that type was a clerical error that was conducive
to an order for rectification under s.20(1)(a).
Joshi v Mahida [2013] EWHC 486 (Ch); [2013] WTLR 859.
The testator’s will left ‘one half of my share’ in his house to his brother
and nephews. The other half of the share was undisposed of, so would
pass to the testator’s wife in the residue. However, another clause in
the will stated that the whole proceeds of the sale of the testator’s
share in the property should go to his brother and nephews, so the wife
would receive nothing from the testator’s share in the house. It was
accepted that there was a clerical error under s.20. The original
language of ‘one half of my share’ would was changed to ‘my one half
share’ in the house.
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Note also:
Marley v Rawlings, above,
The Supreme Court held that where a testator does not know and
approve of the entire contents of a will, it can still be rectified under
s.20. Obiter, the Supreme Court also said that the will could be
rectified if the will failed to satisfy the formality requirements of s.9 of
the Wills Act. In the case of a failure of formalities it is not clear how
such a rectified will would become valid, as the formality requirements
remain in effect. There is considerable discussion of clerical error in the
case. The Supreme Court favoured a ‘wide’ approach to understanding
the term. See paras [50]–[53] and [60]–[85]. There are also important
remarks on the exercise of the court’s inherent power to delete words,
see paras [43]–[49].
Section 20(2) of the Administration of Justice Act 1982 requires that
an application for an order for rectification ‘shall not, except with the
permission of the court, be made after the end of the period of six
months from the date on which representation with respect to the
estate of the deceased is first taken out’. This requirement has been
considered in a few recent cases.
In:
Gerling v Gerling, above,
the court observed that there was an unfettered discretion to grant
permission to make a claim for rectification outside that time limit. The
burden of establishing a case for making such a claim out of time was a
substantive one and lay with the person applying for relief; it was not
merely a procedural time limit. Relevant considerations included the
strength of the claim, the length of the delay, the reasons for the delay,
the prejudice to which it might have given rise, the promptitude with
which the claim was first notified, the existence of negotiations and
whether the estate had been distributed. Ultimately, it was for the
court to decide whether it was just and proper, in all the
circumstances, to extend time for making the claim.
In:
Austin v Wooward, above,
although the application was substantially out of time, it was held to
be appropriate to grant an extension of time. The delays were not
delays for which the applicant could be criticised, and she had brought
the proceedings with reasonable promptitude. The fact that the estate
had not yet been distributed and that she would be significantly
prejudiced and left to a less perfect remedy if the extension was
refused, were also factors that led the court to hold that it was just and
proper to extend time in her favour.
Chapter 4: Revocation
Civil partners
Under the Civil Partnership Act 2004 the provisions of s.18 Wills Act
1837 apply to civil partners.
But in:
Court v Despallieres [2010] EWHC 3340 (Ch); [2010] 2 All ER 451
(Ch D),
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it was held that a will which stated (in a general way) that it would not
be revoked by a subsequent civil partnership was revoked when the
testator entered into a civil partnership, because s.18B(3) of the Wills
Act requires that it must appear from the will that the testator was
expecting to form a civil partnership with a particular person and
he must intend that the will should not be revoked by the formation of
the civil partnership. A general declaration that the will should survive
any civil partnership did not suffice. The section was clear. The same
point would apply in the case of a marriage. The will has to show that
the testator was expecting to marry a particular person.
There have been a number of recent cases in which wills have been
missing and Sugden v Lord St Leonards has been applied. A special
recent example is:
Re Ciebrant, Van Kwawagan v RNLI [2008] EWHC 2246 (Ch).
The deceased’s last will was almost certainly destroyed by someone
who would have benefited if he had died intestate, but the application
of the rule in Sugden allowed the charities who would have benefited
under the will to obtain probate of it.
Chapter 5: Construction
Sammut v Manzi [2008] UKPC 58; [2009] 1 WLR 1834.
The Privy Council had to interpret a badly drafted will and came to a
different conclusion from the Court of Appeal in the Bahamas. This is
not a very helpful case. The Privy Council did not make it clear
whether the will was, or was not, professionally drafted and also said
nothing about the distinction between the literal and the intentional
approaches to construction. There is no Bahamian equivalent to s.21 of
the AJA (or, if there is, the PC did not mention it) and the opinion of
the PC reads as though it were applying the pre-1983 English law on
construction. Students might like to consider how this case would have
been dealt with if it had come before an English court today and so
would have been covered by s.21.
Re Frost [2013] EWHC 435 (Ch); [2013] WTLR 673.
The testator made a will leaving one third of his estate to each of his
two daughters. The remaining one third of his estate was to pass to
other relatives. Before his death, the testator also made gifts of
£100,000 to his two daughters. The question was whether these gifts
should constitute part of the shares to which the daughters were
entitled under the will, due to the presumption against double
portions. If the gifts were regarded as part of the estate, each daughter
would only have been entitled to a little more from the estate. The
court held that the presumption against double portions does not
apply, on the basis that the inter vivos gifts were not of the character of
portions, instead they were intended to reimburse the daughters and
their families for payments made in the past and to be made in the
future for the testator’s care.
Marley v Rawlings, above.
An argument was raised about construction in this case, leading to
obiter remarks by the Supreme Court which consider the construction
of wills to be the same as all other types of documents, with s.21 of the
Administration of Justice Act 1982 providing additional assistance to
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the court where required. This description of the process of
construction seems to be contrary to that which prevailed before 1982.
See paras [17]–[26].
Chapter 6: Family provision
Domicile
Cyganik v Agulian [2006] EWCA Civ 129; [2006] 1 FCR 406.
The partner of a man who died domiciled in Cyprus could not claim
under the 1975 Act, although the deceased had assets of around £6.5
million in England and had made an English will which was admitted
to probate.
See also the recommendation of the Law Commission as to a partial
reform of the domicile requirement (see below).
Spouses
P v G, P and P [2004] EWHC (Fam); [2006] 1 FLR 431.
A ‘big money’ case (the estate was worth over £5 million and there
were significant assets outside the estate, including a pension fund
worth about £4.5 million and sums of £1.2 million nominated to the
deceased’s children by his first marriage). Black J awarded the widow a
capital sum of £2 million (to include the matrimonial home) and
ordered the pension trustees to purchase an annuity for her. Of the
divorce analogy in s.3(2), Black J said it was the minimum that a
widow should attain. Indeed, she said that the analogy was almost
impossible to apply on death, particularly because the tax position on
death is completely different to the tax position on a divorce.
Cunliffe v Fielden [2005] EWCA Civ 1508; [2006] Ch 361; [2006]
2 All ER 115; [2006] WTLR 29.
The Court of Appeal held that the effect of White v White was not to
give rise to a presumed entitlement to equal division of assets between
spouses in the context of the 1975 Act. The judge had awarded the
widow a lump sum of £800,000 out of a net estate of £1.4 million. She
had begun working as housekeeper some 18 months before the
deceased died. She became financially dependent on the deceased,
initially as housekeeper and then as his wife. The will was executed a
year before he died and a few days before he married the claimant.
She had benefited by survivorship from a number of funds and policies
in their joint names. Under the will, she was a member of a class of
objects of a discretionary trust of the residuary estate.
The Court of Appeal overturned the trial judge’s decision. He had not
explained how he had exercised his discretion. In the context of
reasonable financial provision under s.1(2)(a) and s.3(2)(b), the Court
of Appeal stated that there was a clear difference between a widow
who had been married for many years and who had made an equal
contribution to the family of the deceased and a person (such as the
claimant here) who had been married for only just over a year and
who had made little contribution to the family wealth. White v White
could be departed from if there was good reason. The Court of Appeal
substituted a lump sum of £600,000.
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Re Waite (also known as Barron v Woodhead) [2008] EWHC 810
(Ch); [2009] 1 FLR 747; [2008] WTLR 1675.
The applicant widower (B) applied for reasonable provision out of the
estate of his late wife. The claim was made against the respondent
residuary beneficiaries of the estate (W), the deceased’s two children
who were also the personal representatives of her will. B, who was 73
at the time of the hearing, met the deceased in 1986 and they
cohabited until their marriage in 1993. Both spouses were heavy
drinkers and there were incidents of domestic violence carried out by
both parties. The couple lived in B’s property where he had run a
haulage business until he was declared bankrupt in 1999. They
separated in 2001 but divorce proceedings were never commenced.
The net estate was valued at about £315,000. W submitted that no
award should be made to B on account of his conduct, namely the
domestic violence and his evasiveness with both the court and the
trustee over financial matters.
The court (following Cunliffe v Fielden, above) held in favour of the
applicant. The Act contemplated an objective, two-stage approach.
First, the court had to consider the factors set out in s.3 in order to
determine whether it was reasonable to make no provision for B. If it
considered that reasonable provision had not been made, it had then to
consider the same factors in order to evaluate any provision to be
made under the Act. Despite the uncertainties in respect of B’s financial
position, the court was not satisfied that he had funds that would
enable him to rehouse himself. In all the circumstances the will did not
objectively make reasonable financial provision for B. Therefore the
suggestion that there should be no award or a very small award was
wholly unrealistic. However, the principal concern of the court was to
ensure that B had a roof over his head and had sufficient means for his
everyday needs. In all the circumstances of the case, it was not
appropriate for there to be a substantial additional capital award.
Considering B’s needs, it was therefore proposed to direct that he had a
life interest in £100,000 to be used to purchase suitable
accommodation. In addition, B should be entitled to a lump sum of
£25,000 to defray any costs of moving, to set himself up in the
property and meet future expenses.
Iqbal v Ahmed [2011] EWCA Civ 900; [2011] 3 FCR 1; [2011]
WTLR 1351.
It was appropriate to give a widow who had been financially
dependent on her husband a right to occupy her matrimonial home for
life, half of any sale proceeds, and the whole of the husband’s
residuary estate by way of reasonable financial provision, rather than a
life interest in the home. The deceased had been married to W for 22
years when he died. S was his son from an earlier marriage. W was 61
years old at the time of the hearing, spoke little English and had been
financially dependent on the deceased, though she had accumulated
£3,000 in savings. The will gave W £8,000 and a right to occupy the
matrimonial home rent free. That right was subject to an obligation to
keep the property in repair. Subject to her right of occupation, the
property was given to S absolutely, as was the residuary estate. The
property was worth approximately £115,000. It was poorly maintained
and required repairs costing over £30,000. The residuary estate was
worth £28,000. The deceased had given S a gift during his lifetime of
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£21,500 and S was comfortably off. The judge ordered that W should
receive the right to occupy the property for life, half the proceeds of
sale of the property, the whole of the residuary estate and S’s
agreement to pay half the insurance and the structural repairs of the
property.
Lilleyman v Lilleyman [2012] EWHC 821 (Ch); [2012] 3 WLR
754; [2012] 2 FCR 171; [2012] WTLR 1007.
The claimant had been married to the deceased for a little over two
years at the time of his death. The deceased left a large estate (over £6
million). Under the deceased’s will, the claimant received limited rights
to occupy both the matrimonial home and an apartment, a fixed
annuity worth £378 per month and personal chattels worth £18,000.
The claimant argued that this provision was not reasonable. Most of
the residuary estate was left to the deceased’s sons by a previous
marriage. The court held that the provision made for the claimant was
not reasonable. ‘Reasonable’ provision for a spouse was not limited to
providing financial security for the rest of her life. A wider range of
considerations were relevant, including (but not limited to) the
hypothetical divorce provision in s.3(2). ‘Financial obligations and
responsibilities’ in s.3(6) of the 1975 Act included the testator’s moral
financial obligations, in addition to any legally binding obligations. The
court also considered that the relationship between the claimant and
the deceased’s sons had broken down, which would make it difficult
for them all to have interests in the same properties. The court held
that in addition to the property given by will, the claimant should
receive the estate’s entire interest in the matrimonial home and
apartment, as well as the estate’s future interest in another property (in
all cases, the claimant could receive a lump sum representing present
market value if she wished).
Civil partners
The Civil Partnership Act 2004 adds the civil partner or former civil
partner of the deceased to the categories of applicant who can apply
under s.1 of the Act.
The appropriate standard for civil partners is ‘such financial provision
as it would be reasonable in all the circumstances of the case for a civil
partner to receive, whether or not that provision is required for his or
her maintenance’.
But note that in:
Southern Housing Group Ltd v Nutting [2004] EWHC 2982; [2004]
All ER (D) 347; [2005] 1 FLR 1066,
Evans-Lombe J upheld the decision of a recorder to the effect that two
homosexuals were not living together as husband and wife and that
the survivor was not, therefore, entitled to succeed to an assured
tenancy as the ‘spouse’ of the deceased. Whether the relationship is
heterosexual or homosexual, the crucial requirement of living together
as husband and wife is a ‘commitment to permanence – the
relationship must be an emotional one of mutual lifetime
commitment, openly and unequivocally displayed to the outside
world’. There was no such commitment in this case.
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And in:
Baynes v Hedger [2008] EWHC 1587 (Ch); [2008] 2 FLR 1805;
[2008] WTLR 1719,
the parties were not ‘living together as civil partners’ because: (i) their
relationship was not openly and unequivocally displayed to the outside
world; and (ii) they had two separate establishments.
Cohabitants
Re Dix [2004] EWCA Civ 139; [2004] 1 WLR 1399; [2004] WTLR
331.
A three-month separation between the respondent and the deceased
did not render the respondent unable to satisfy the provisions of the
1975 Act since it was clear that this was not the settled situation and
the couple were still part of the same household.
Lindop v Agus [2009] EWHC 1795 (Ch); [2010] 1 FLR 631; [2009]
WTLR 1175.
A claimant established that she had been living as the wife of a
deceased within the meaning of s.1(1A) of the 1975 Act even though
she retained a different address for official correspondence. L had met
D, a dentist, at the practice where she worked part time. Both had
children from previous relationships and L was living with her father
after her divorce. She later moved into D’s house and lived there for
several years before his death. However, she continued to use her
father’s address for official correspondence and she remained
registered on the electoral roll at his house. After D’s death, L brought
a claim for financial provision as a person who was living in the same
household as D as his wife and/or as a person who was being
maintained by D. The court was required to determine as a preliminary
issue whether L was eligible to bring a claim. D’s executors submitted
(inter alia) that L could not establish that she was living as D’s wife as
she still used her father’s address for correspondence, and her
relationship with D was therefore not openly and unequivocally
displayed to the outside world. Despite a lack of documentary
evidence, there was sufficient corroboration from witness evidence to
find that L and D had lived in the same household for a period of at
least two years before D’s death. There was a stable sexual relationship
between them, and D provided a roof over L’s head and paid for the
outgoings of the house. He also paid for holidays and clothes for L, and
they looked after the children together. It was plain that they were
living together. The remaining question was whether L was living as
D’s wife. The court was required to give effect to the statute, which
simply required that L and D be living as man and wife. The fact that
L’s bank and other public bodies sent letters to her father’s address
shed little light upon whether she was living with D as his wife. Whilst
some of the evidence was inconsistent with L’s case, it had to be
weighed against the other evidence, which pointed towards L and D
living openly together and displaying that to the outside world.
Marriages are multifarious. L had been subject to a bitter divorce, and
in those circumstances there was nothing inconsistent with her living
with D as ‘man and wife’ whilst retaining a different address as
security or in case the relationship broke down.
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Re Evans [2011] EWHC 945 (Ch); [2011] 2 FLR 843; [2011]
WTLR 947.
Since the disposition of the estate of an individual who had died
intestate did not make reasonable financial provision for his partner
(C), she was entitled to a sum from his estate under the 1975 Act to
allow her to purchase a house. That property would be held on trust
for the deceased’s sons subject to an interest in C’s favour entitling her
to live there for as long as she wished. The starting point was that no
financial provision had been made for C at all. She was 60 and had
lived with the deceased for five years, and they had contributed equally
to looking after their home together. C’s only source of income was
rental from her English property and a small pension, although she
would in due course receive a state pension. The sons were selfsupporting
adults.
Patel v Vigh [2013] EWHC 3403 (Ch).
In relation to an application under the 1975 Act, the judge held that an
unmarried couple who would otherwise be regarded as living as
husband and wife, would still be so regarded when one of the partners
was in hospital for two months before his/her death.
Children
Gold v Curtis (2004) 154 (7157) NLJ 1888; [2005] WTLR 673.
The court emphasised that the basis of the court’s jurisdiction is the
relief of financial need and not the achievement of equality or fairness
between competing children. The entire estate of £870,000 had been
left to a well-off daughter and nothing given to an adult son whose
financial position was perilous and whose pension provision was
inadequate. The son was awarded £220,000 to augment his income
and £30,000 as a capital sum.
Myers v Myers [2004] EWHC 1944; [2005] WTLR 851.
The testator was held not to have made reasonable financial provision
for his adult daughter’s maintenance where she was living in severely
straitened circumstances and her situation was a result of her awkward
personality and mental fragility rather than indolence. She had not
behaved as badly to her father as he seemed to believe and he had very
substantial wealth: the deceased had left his entire estate (of over £8
million) to his second family.
But note also:
Ilott v Mitson [2011] EWCA Civ 346; [2011] WTLR 779,
in which the Court of Appeal overruled the decision of Eleanor King J
(noted in the previous Update as H v Mitson [2009] EWHC 3114
(Fam); [2010] WTLR 193 (Fam Div)) and restored the decision of
the District Judge.
A mother disinherited her estranged daughter and left her entire
£486,000 estate to animal charities. Eleanor King J said that the
question was whether the provision made for the daughter by the
mother was (objectively) unreasonable. She held (overturning the
District Judge’s award) that it was not objectively unreasonable and so
the daughter was entitled to nothing. This tended to revert to the
approach taken in the earlier case of Coventry (1980) rather than the
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kinder (and possibly less logical) line in the later case of Espinosa
(1999).
The Court of Appeal allowed the daughter’s appeal, holding that the
value judgment made by the trial judge in determining whether the
financial provision resulting from a will was reasonable should not be
interfered with by an appellate court unless ‘plainly wrong’, and
reasserting that, in order to succeed under the Act, there was no need
for an adult child of the deceased to show that the deceased owed him
a moral obligation. It was plain that the District Judge had not erred in
law. He had asked himself the right question, namely whether having
considered all the s.3 factors the resulting lack of provision was
unreasonable. He had then proceeded to consider those factors
meticulously. The District Judge was not under an obligation to
‘balance’ the s.3 factors, or to explain why the particular combination
of factors led him to the conclusion that no provision was
unreasonable. That was a value judgment that the District Judge was
entitled to make and that exercise should not be interfered with by an
appellate court unless ‘plainly wrong’. The District Judge had to
exercise a discretion in deciding what, if any, relief to award, and did
so in the instant case, explaining fully and precisely the relief he was
awarding and why. Therefore, the criticism that he had not conducted
the necessary ‘balancing exercise’ was misplaced. There was plainly an
overlap between the value judgment that the provision was
unreasonable and the exercise of the discretion in making the award.
However, what mattered was that the decision taken as a whole
explained why the judge had reached the conclusion he had. An adult
child of the deceased did not have to show that the deceased owed him
a moral obligation or that there were other special circumstances in
order to succeed under the Act. Further, in deciding whether the
disposition of the deceased’s estate made reasonable provision for the
applicant, the trial judge was not exercising a discretion, but making a
value judgment based on his assessment of the factors in s.3(1).
Dependants
Baynes v Hedger [2009] EWCA (Civ) 374; [2009] 2 FLR 767.
The claimant failed both in the High Court and in the Court of Appeal,
but in the Court of Appeal it was on the ground that she did not even
have the standing to bring a claim, because the deceased had not
assumed responsibility for her. This is the approach taken by
Megarry V-C in Re Beaumont and appears harsher than that taken by
the Court of Appeal in Jelley v Iliffe.
Playforth, S. ‘Respecting our elders’ (2013) 163 New Law Journal
19
considers the difficult position in which parents of a deceased child can
find themselves, given the limitations of the rules about family
provision.
Law Commission Report 2011
As mentioned under Chapter 2 above, on 14 December 2011 the Law
Commission published a Report on Intestacy and Family Provision
Claims on Death (Law Com No 331), which followed the Consultation
Paper (CP No 191) noted in an earlier Update and which reviewed the
current law and discusses options for reform.
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The 271-page Report can be accessed via the Law Commission’s
website at:
www.justice.gov.uk/lawcommission/docs/lc331_intestacy_report.p
df
Along with a 5-page Executive Summary:
www.justice.gov.uk/lawcommission/docs/lc331_intestacy_summa
ry.pdf
The main recommendations of the Report in relation to the law of
family provision under the 1975 Act are broadly as follows:
In relation to provision for a surviving spouse, it is proposed that it
be made clear that the requirement to ‘have regard to’ what he/she
might reasonably have expected to receive on divorce (or
dissolution of a civil partnership) should not act as any kind of
limit (upper or lower) upon entitlement to family provision (paras
1.88, 2.146, 9.7).
In relation to a ‘child of the family’, it is recommended that this
class should not be limited to cases where the deceased was
married or in a civil partnership (paras 1.96, 6.41, 9.14).
Also, a ‘dependant’ should not be required to prove that the
deceased had ‘assumed responsibility’ for him/her, as distinct from
the fact of maintenance, or that the deceased contributed more to
the relationship, in terms of financial value (paras 1.96, 6.59, 6.76,
9.15-9.16) – a reform that would ‘open the door for claims in cases
of interdependence’.
There are significant recommendations in relation to cohabitants
(to mirror similar recommendations made in relation to the law of
intestacy), essentially by removing the requirement for
cohabitation for a two-year period where the cohabitants have
children. The proposal is that an application may be made by a
person who (1) was the father or mother of a child of the deceased
and (2) at the date of death was (a) living in the same household
as the deceased and (b) as the deceased’s spouse (para. 8.153).
It is recommended that the classes of potential applicants should
not be widened (para. 6.94).
There should be no change to the ‘maintenance’ standard of family
provision as it applies to children (paras 1.95, 6.26).
The domicile requirement should be reformed, so that an
application may also be made where English domestic succession
law applies to any part of the estate (paras 1.98, 7.17, 7.37, 9.18).
There are other, largely technical, proposals for reform, as set out
in the Report.
Candidates are strongly encouraged to familiarise
themselves with the recommendations of the Report and
also its full and helpful discussion of the issues examined.
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Chapter 7: Entitlement
7.4 Lapse
Rainbird v Smith (2012) 156(22) SJLB 31.
A will left the residuary estate to ‘upon trust for such of them, my
daughters, R, J and S, as shall survive me, and if more than one, in
equal shares absolutely’. One of the daughters predeceased the
testatrix. The question was whether s.33 of the Wills Act 1837 applied
so that the daughter’s surviving children could inherit under the will.
According to s.33, this will happen ‘unless a contrary intention shall
appear by the will’. The High Court held that the clear intention of the
testatrix was that the residuary estate should pass only to those of her
daughters who survived her. This was a clear intention that the rule in
s.33 of the 1837 Act should not apply. The residuary estate passed only
to the two surviving daughters, not the testatrix’s grandchildren.
7.6 Forfeiture
The Estates of Deceased Persons (Forfeiture Rule and Law of
Succession Act) 2011 came into force on 1 February 2012. The Act
inserts new sections into two existing statutes in relation to forfeiture.
For testate succession, the Wills Act 1837 now includes s.33A. By
this section, if the killer would have been entitled to receive
property under the victim’s will, but is precluded from doing so
due to the forfeiture rule, the killer will be treated as having
predeceased the victim. The rules of lapse and s.33 of the 1837 Act
will then apply.
For intestate succession, the Administration of Estates Act 1925
now includes s.46A. By this section, if the killer would have been
entitled to receive property under the victim’s intestacy, but is
precluded from doing so due to the forfeiture rule, the killer will
be treated as having predeceased the victim.
Chapter 8: Alternative succession
8.1 Privileged wills
Re Servoz-Gavin, Ayling v Summers [2009] EWHC 3168; [2010] 1
All ER 410.
This is a rare example of a reported case concerning a seaman’s
privileged will. The deceased was a ship’s radio officer and made the
will while ashore, but when under orders to join his ship. Will upheld.
8.2 Statutory wills
Re P [2009] EWHC 163 (Ch); [2009] 2 All ER 1198.
This was an application to the Court of Protection for the making of a
statutory will. It is the first reported case of such an application under
the Mental Capacity Act 2005. It was held that guidance under the
Mental Health Acts 1959 and 1983 was no longer directly applicable.
Under the 1983 Act, the court had to imagine that the patient had had
a brief lucid interval and had then to imagine what will he would have
made during that interval (the ‘substituted judgment’ approach).
Under the 2005 Act, the court had to work out not what the patient
might be expected to have done, but what was in his best interests (the
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‘balance sheet’ approach). It would be relevant to his best interests
how he would be remembered after his death.
Re M [2009] EWHC 2525 (Fam); [2011] 1 WLR 344.
The applicant property and affairs deputy (W) applied for an order
authorising him to execute a statutory will for the elderly second
respondent (M). M was a childless widow who lacked testamentary
capacity. She had, at different times, made wills in which she had left
most of her property to charities or her neighbour. She was later cared
for and lived with the first respondent (Z) and his family and during
that period she transferred significant sums to Z and, in 2004, made a
will under which he was the sole beneficiary and granted an enduring
power of attorney in his favour. W was later appointed to act for M and
by court order M was removed from Z’s address. Contrary to a court
order, Z failed to provide information concerning his receipt of M’s
money and was accordingly criticised by the court. The court later
directed that an interim will should be made for M and reviewed once
the beneficiaries under her previous wills had been notified. That
interim will reinstated the terms of a will made before M had lived
with Z and made provision for the charities and M’s neighbour. W and
M submitted that a statutory will under the Mental Capacity Act 2005,
s.18(1)(i) should be made for M in substantially the same terms as the
interim will. Z argued that a statutory will should be made in the same
terms as the 2004 will. W’s application was granted. Munby J followed
Re P, above, and held that decisions on earlier Acts should be
consigned to history. The starting point was the structured decisionmaking
process prescribed by the 2005 Act, a process which required
the decision-maker to take a number of steps before reaching a
decision, including encouraging the legator to participate in the
decision, considering his or her past and present wishes, beliefs and
values, and taking into account the views of third parties as to what
would be in the legator’s best interests. There was no place in that
process for reference to judicial decisions under the earlier and very
different statutory schemes.
The Act laid down no hierarchy as between the factors which had to be
borne in mind, beyond the overarching principle that what was
determinative was the judicial evaluation of what was in the
individual’s best interests. The weight to be attached to the factors
would differ depending upon the individual circumstances of the
particular case but there might be one or more features which were of
magnetic importance in influencing or determining the outcome. The
individual’s wishes and feelings were a significant factor to which the
court had to pay close regard. The weight to be attached to those
wishes and feelings was always case-specific and fact-specific and in
considering their weight and importance, as required by s.4(2), the
court had to have regard to all the relevant circumstances. That
included the degree of the individual’s incapacity, the strength and
consistency of the views they expressed, the possible impact on the
individual of knowledge that their wishes and feelings were not being
given effect to, the extent to which their wishes and feelings were, or
were not, rational, sensible, responsible and pragmatically capable of
sensible implementation in the particular circumstances and, crucially,
the extent to which those wishes and feelings, if given effect to, could
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properly be accommodated within the court's overall assessment of
what was in their best interests.
Re D [2010] EWHC 2159 (Ch); [2010] WTLR 1511.
This is a case where the Court of Protection ordered the execution of a
statutory will in 2010 to undo the effect of two earlier wills made in
2004 and 2006 when the testatrix probably lacked capacity. The
statutory will was on the same terms as a will which the testatrix had
made in 1995 when she did clearly have capacity. In other words, the
statutory will was used to undo the effect of two ‘suspicious wills’.
Compare this case with Re Davey (1981) where a statutory will was
executed to undo the effect of a marriage which should not have taken
place.
NT v FS [2013] EWHC 684 (COP); [2013] WTLR 867.
A case about making a statutory will. The court repeated the obligation
under the 2005 Act to act in the individual’s best interests, rather than
following their wishes. However, the court also observed that s.4(6)(a)
of the Mental Capacity Act 2005 requires the person making decisions
for someone lacking capacity to take into account the past wishes of
the individual in question. In this case, that meant that a document
made when the individual possessed capacity, which purported to be a
will (but was invalid), was relevant to the decision-making process.
However, this document was not of especially great weight as it was
unwitnessed and was 26 years old, during which time there had been
considerable changes in the individual’s life.
8.3 Mutual wills
Carvel Foundation v Carvel [2007] EWHC 1314 (Ch); [2007] 4 All
ER 81.
This case held that mirror-image wills made by a husband and wife,
which they had agreed not to alter or revoke, had been mutual. The
husband and wife had agreed, at the time they made their wills, that
neither would make any gratuitous transfers during their joint lives,
unless the other agreed, and that the survivor would make no
gratuitous transfers. This was an unusually clear case of mutual wills.
Charles v Fraser [2010] EWHC 2154 (Ch); [2010] WTLR 1489.
This is said to be only the third contested mutual wills case in England
in the last 80 years. Most mutual wills cases involve married couples,
but this case concerned two widowed (childless) sisters whose wills
were in favour of family members. The trial judge (quite correctly)
criticised the draftsman of the mutual wills for not making a clear note
of the fact that they were mutual, and for not including a recital of it in
the wills.
Fry v Densham-Smith [2010] EWCA Civ 1410; [2011] WTLR 387.
A decision that an oral agreement for mutual wills had been made and
acted upon would not be set aside where the trial judge had produced
a sound judgment which had not strayed beyond the boundaries of
solid evidence into the realms of surmise and speculation, which had
made reasonable and proper inferences from the facts, events and
circumstances and which did not contain any misdirection of law. The
judge found that D and H had executed mutual wills pursuant to an
oral agreement so that on H’s death an irrevocable trust took place and
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that on D’s death some 15 years later the trust was binding on her
estate. Under that trust M and F were entitled to an equal half share of
D’s net estate. However, under the last of three non-mutual wills made
by D after H’s death, F was the sole executor and beneficiary. F
appealed against the findings of the judge on the basis that they were
not supported by the evidence and that M was not entitled to any share
in D’s estate.
The Court of Appeal dismissed the appeal, holding that, despite the
deficiency of direct evidence and the piecemeal nature of the evidence
relied on by the judge for his conclusion, this did not defeat M’s claim
or undermine the judgment. The judge had made reasonable and
proper inferences from the facts, events and circumstances about what
had probably been arranged and agreed between H and D, and had
satisfactorily explained his reasoning. The result was a sound judgment
which had not strayed beyond the boundaries of solid evidence into
the realms of surmise and speculation. The instant court should not
interfere with it. It did not contain any misdirection of law nor could it
be said that the key findings were contradicted or unsupported by
evidence or based on inferences so improbable that no reasonable
judge could have made them. (It must be questioned, nonetheless,
whether this enables a mutual will to be proved rather more easily
than has been the case in the past. Strong, almost irrefutable proof,
seems to have been looked for in earlier decisions, but clearly not in
this case.)
8.6 Donatio mortis causa
Vallee v Birchwood [2013] EWHC 1449 (Ch); [2013] WTLR 1095.
A case which applied Sen v Headley, recognising the validity of a
donatio mortis causa of land. ‘Dominion’ could be given by handing
over of the keys and title deeds to the deceased’s house; these
restricted what the deceased could do with the property. The
deceased’s continued use of the property did not invalidate the gift.
The only other question was whether the gift was made in
contemplation of death. The deceased made the gift in August, saying
that he did not expect to be alive much longer and might not be alive
by the donee’s next visit at Christmas. The deceased died in September.
The court held that this four month gap between the gift and death
was acceptable – the question is not whether the deceased had good
grounds for expecting death, but whether the motive for the gift was
the deceased’s subjective contemplation of his/her death in the near
future.
Roberts, N. ‘Donationes Mortis Causa in a dematerialised world’
(2013) 77 Conv 113–28.
An excellent article discussing the difficulties in applying the rules of
donationes mortis causa, especially those of indicia of title, to modern
contexts
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