In the recent case of Larsen & Anor v Annan [2023] EWHC 662 (Ch), two sons of the Deceased made separate claims for reasonable financial provision under the Inheritance (Provision for Family and Dependents) Act 1975.
This case highlighted the factors taken into account by the courts when assessing claims for reasonable financial provision and demonstrated that neither disability, nor previous gifts made by the Deceased, guarantee a successful claim.
The case involved two sons – Wayne and Russell, who made separate claims against their father’s will for reasonable financial provision under the Inheritance Act**.
The brothers’ father George died in 2021 and was survived by three adult children - his two sons Wayne and Russell and a daughter Heather. He left an estate valued at approximately £280,000 and made a gift of £10,000 to each of his three children from the estate, with the remainder left to his wife. If his wife predeceased him (as happened in this case), the remainder would go to his daughter Heather. The will also appointed Heather as executrix of his estate.
It was clear from attendance notes taken by the solicitor who had drafted George’s will that he had left the remainder of his estate to Heather because he believed that his two sons had "not been best behaved in the past" – during the trial it was established that Wayne had a manslaughter conviction and Russell had a gambling habit that had led him to steal money from other family members.
In fact, George’s original intention was not to leave his sons anything from his estate. But, after being advised of the potential for his sons to bring a claim, he decided to include the gifts to his sons simply to try and deter them from challenging his will.
The judgment in this case is of interest because it highlights the factors that courts will take into account when assessing claims for reasonable financial provision under the Inheritance Act and importantly, that disability and previous gifts made by the deceased do not in themselves guarantee a successful claim.
The Judge considered each of the son’s individual financial circumstances when assessing their claims:
Wayne had lived independently from his parents for many years prior to George’s death and owned three separate properties which had substantial equity and provided him with rental income. He was claiming an income deficit resulting from several debts he owed and the fact that his wife and two of his children were still largely dependent on him. The Judge however did not accept that Wayne’s two adult children were financially dependent on him.
Russell’s situation was very different. Although he had also lived independently from his parents for many years, he was chronically disabled, dependent on help for many ordinary daily tasks and was living in a housing association property tenanted to a long term friend with terminal cancer. Bank statements however showed that Russell was living within his means – evidenced by his ability to maintain a gambling habit.
The Judge also considered the daughter’s financial circumstances, as any award made to the son’s would take away from her inheritance. The Judge noted that she suffered from numerous health conditions and was unemployed and unable to work.
The Judge noted that George ‘had positive reasons for wishing to exclude both sons from the will, and that it cannot be said that he was acting unreasonably in making only minimal provision for them’.
While it was accepted that Wayne had received numerous cash gifts from his dad before his death, that this did not give rise to any responsibility or obligation towards his son. The Judge stated that the gifts did not suggest that Wayne was being ‘maintained’ by his dad and with significant assets of his own, no continuing need to maintain his children and numerous inconsistencies that came to light during the trial around his claimed expenses – Wayne could meet his own reasonable financial needs. His claim was therefore dismissed.
Although the Judge concluded that the second son Russell had ‘more than enough to meet his current needs’ financially, he would be unlikely to be able to cover his probable future care costs. Therefore, the will did not make reasonable financial provision for him. The Judge awarded Russell a sum of £25,000 in a discretionary trust, in addition to his £10,000 pecuniary legacy under the will. In determining the appropriate size of the award, the Judge explained that although the estate could never support the full cost of private care for Russell for the remainder of his life, that did not mean that reasonable provision is only made if full likely care costs are met.
*A copy of the judgment on this case: Larsen & Anor v Annan [2023] EWHC 662 (Ch) can be found here: https://www.bailii.org/ew/cases/EWHC/Ch/2023/662.html
**For more information on this article or the Inheritance Act (Provision for Family and Dependents) Act 1975, please contact Robert Horsey from our Wills & Inheritance Disputes team.
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