Ilott v The Blue Cross and others: Supreme Court Judgement

Previously Ilott v Mitson

The Supreme Court recently handed down its long awaited judgment in the highly publicised case of Ilott v Mitson and allowed the appeal of residuary charity beneficiaries of the estate of the late Melita Jackson.

It is the first case in which the Supreme Court has had the opportunity to give guidance on what constitutes ‘reasonable financial provision’ within the meaning of the Inheritance (Provision for Family and Dependants) Act 1975.

Mrs Melita Jackson died in 2004 leaving a Will, excluding her adult daughter Heather Ilott with whom she had been estranged from for 26 years.  Mrs Jackson went so far as to write a letter of wishes, stating explicitly that her daughter should not inherit.  Instead she left the entirety of her estate worth approximately £486,000, to three charities which she had no obvious connection with during her lifetime.

Mrs Ilott who was not financially dependant on her mother brought a claim under the Inheritance (Provision for Family and Dependants) Act 1975 which states that a person of a classified relationship to the deceased e.g. children can apply for reasonable financial provision from the testators estate.

Mrs Ilott’s financial circumstances were described as modest, she lived in a house rented from a housing association and the majority of her family’s income was derived from state benefits.  When the case was originally heard in 2007 by District Judge Million he decided it was unreasonable for Mrs Ilott to be excluded from her mother’s estate, due in part to her strained financial circumstances and she was awarded a lump sum of £50,000.

Mrs Ilott appealed this decision as she argued the amount of the award was not sufficient for her to purchase her home and the lump sum would affect her right to means tested benefits.

The Court of Appeal allowed Mrs Ilott’s appeal on the basis that the District Judge had awarded her unfairly by reference to her limited means and living expenses and that he had failed to properly investigate the effect of the award on her benefits entitlement. The Court of Appeal increased the award to £143,000 which would allow Mrs Ilott to purchase her housing association home, cover the reasonable costs of purchase and also awarded a cash sum of £20,000 to provide additional income, however, this was to be structured in a way that would allow Mrs Ilott to preserve her benefits.

The charities appealed this decision and the Supreme Court allowed the appeal and reinstated the award of £50,000 made by the District Judge Million.  The Supreme Court took the view that the Court of Appeal had no proper basis for interfering with the initial judgment.

The judgment confirms that testamentary freedom remains a key principle of English law and does reinforce the position as it had been understood prior to this case.  The Supreme Courts Judgment will come as some comfort to those who felt that the Court of Appeals decision made it easier for adult children including those who were estranged from their parents to challenge a Will. The Supreme Court was clear that the wishes of the testator must be respected as far as possible but that each case will be decided on its own particular facts and that the Court has a wide discretion in the awards it makes.   The Court has to balance the individuals right to leave their estate to whoever they choose on their death against the moral obligation to look after individuals to whom they are related or were maintained by them prior to death.

The judgment is significant for those making their Wills, their prospective beneficiaries and those advising them. It is important for anyone considering making a Will which excludes a spouse or a relative to obtain proper legal advice to reduce the threat of a successful claim against the estate for reasonable financial provision.

If you would like to speak to someone about your Will then please contact Tanya Ghuman on 02477 710221 or email: tanya.ghuman@alsterskelley.com