15 April 2015

Making a claim against an estate

The death of a loved one may cause significant financial pressures for their families and often people rely on the benefits provided for them in a Will to ease these burdens. However, where a person dies without leaving a Will or without making any (or sufficient) provision for a loved one, this can leave them in a very difficult position.

In this article we explain how to make a claim against an estate for reasonable financial provision pursuant to the Inheritance (Provision for Family and Dependants) Act 1975 (the “1975 Act”).

1. Who Can Apply?

A person can only rely on the 1975 Act providing that the deceased, at the date of death, was living in England and Wales, and the applicant falls within one of the following categories:

  • They were a spouse, civil partner or former spouse / civil partner of the deceased. However, former spouses or civil partners may be precluded from making a claim by the terms contained in the order dissolving the former marriage / civil partnership. As such, it is imperative to check the terms of these orders before pursuing a claim;
  • Any person living with the deceased as husband, wife or civil partner for two years or more immediately prior to the death;
  • A child of the deceased or any person who was treated as a child of the deceased (i.e. a step-child, foster or adopted child); or
  • Any person who, immediately before the death of the deceased, was being wholly or partially maintained by them (i.e. the deceased was responsible for all living and household expenses such as food, bills, clothes and luxury items).

2. What is Reasonable Financial Provision?

This depends on the nature of the applicant’s relationship with the deceased. For an applicant who is the husband, wife or civil partner of the deceased (or others who are treated as spouses or civil partners), the provision is based on what it is reasonable for the applicant to receive rather than what is necessary for their maintenance. This often results in much higher awards and usually includes a share of the estate or of the value of the matrimonial home.

For other applicants, the provision will be assessed by what the Court considers is reasonable for their maintenance only. This is calculated by reference to what it would be reasonable for the applicant to live on. The Court will have regard to the current and future income and expenditure of the applicant, together with standard of living enjoyed by the claimant during the lifetime of the deceased and will try to maintain this as far as possible. The claims will turn on financial evidence and so at an early stage it is necessary to investigate the claimant’s assets, liabilities and needs both now and in the future.

An award by the Court may take the form of a lump sum payment, a regular monthly income, deferred payments or an amount settled on trust.

3. What is the Test?

The crucial question is whether or not the Will (or the intestacy) failed to make reasonable financial provision for the applicant in all the circumstances of the case. The burden is always on the applicant to prove the case for reasonable financial provision at the appropriate standard. The Court will consider the following factors:

(a) the financial resources and financial needs which the applicant has or is likely to have in the foreseeable future;

(b) the financial resources and financial needs which any other applicant has or is likely to have in the foreseeable future (i.e. children);

(c) the financial resources and financial needs which any beneficiary of the has or is likely to have in the foreseeable future;

(d) any obligations and responsibilities which the deceased had towards any applicant or beneficiary of the estate of the deceased (i.e. maintenance payments);

(e) the size and nature of the net estate of the deceased. The Court will not take certain assets into account which could attract inheritance tax, such as property passing by survivorship;

(f) any physical or mental disability of any applicant or any beneficiary of the estate of the deceased; and

(g) any other matter, including the conduct of the applicant or any other person, which in the circumstances of the case the Court may consider relevant.

4. How do I Make a Claim?

A claim must be brought against the estate within six months from the date of the grant of representation, failing which it is necessary to request the permission of the Court, who are only allowed to accept late claims in exceptional circumstances.

The Court encourages parties to comply with the Practice Direction on Pre-Action Conduct (the “PD”) in Inheritance Act Claims. As such, the first step is to prepare a detailed Letter of Claim to forward to the executors of the estate, setting out the claim for financial provision; providing full disclosure of the applicant’s financial needs and why they are entitled to make a claim in accordance with the factors set out above. The parties will usually explore Alternative Dispute Resolution, including mediation or without prejudice meetings.

Only if the estate refuses to pay, or settlement appears unlikely, is it necessary to commence proceedings in the High Court.

5. How Can I Fund A Claim?

We understand that those pursuing a 1975 Act Claim have limited financial resources and as such require flexible funding arrangements. We are happy to offer a range of funding options including fixed fees, conditional fee agreements, payment deferral or third party litigation funding. If the claim is successful, we are usually able to recover a contribution towards these legal costs from the estate.

Current Instructions

Harrison Clark Rickerbys is currently representing an applicant making a 1975 Act Claim who had been living with the deceased for 12 years and was wholly maintained by him prior to his death. Unfortunately, she was not sufficiently provided for in his Will and left in a desperate financial position. Acting on a deferred payment basis, Harrison Clark Rickerbys have initiated the PD process and are exploring Alternative Dispute Resolution with the estate with a view to reaching early settlement terms and avoiding Court proceedings.

If in doubt, seek early legal advice.

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About the Author
Elizabeth Beatty, Partner
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