20 March 2009
Probate actions
Increasingly, probate practitioners and will writers are finding themselves at the heart of disputes concerning testamentary documents or estate administration.
Contested probate litigation can be time consuming, not only for prospective beneficiaries but also for personal representatives and professional advisors, tasked with implementing the wishes of a testator. For that reason, it is useful to look at some of the more common forms of probate actions, to see what lessons can be learned and what steps can be taken to minimise the risk of future probate claims.
The most common forms of probate actions include (1) challenges to the validity of a will or codicil and (2) challenges to the provisions of a valid will (or intestacy rules), under the Inheritance (Provision for Family and Dependants) Act 1975. Here are some of the basic ingredients of the two types of claim:
Challenge to the validity of a will (or codicil)
Wills can be challenged on one or more of the following grounds:
1 Technical defect
Most professionals will be aware of the basic formalities set out in section 9 of the Wills Act 1837 (as substituted by the Administration of Justice Act 1982), which include the requirements that the will be in writing, signed by the testator (or some other person in his presence and at his direction) with the intention of giving effect to the will and witnessed by two or more witnesses, present at the same time as the testator.
Although fairly basic in their terms, these requirements have been the subject of much litigation. For example, a number of different cases have extended the general meaning of the testator's "signature" to include a partial signature, the deceased's initials, and an inky thumb print, along with other variations. Furthermore, the requirement that the will be signed in the presence of two or more witnesses can often give rise to difficulties, particularly where a professional has not taken proper steps to explain the execution requirements to the testator. In one particular case (Esterhuizen v Allied Dunbar [1969] 2 All ER), the Judge suggested a professionals failure to oversee the execution of a will might amount to negligence (as it did in that case).
2 Lack of Capacity
The question here is not whether a testator has general mental capacity but whether they have the requisite testamentary capacity to make a will. Banks v Goodfellow (1870) set out the criteria for determining testamentary capacity. The testator should (1) understand the nature of the Act and its effects; (2) understand the extent of the property being disposed of; and (3) be able to comprehend and appreciate the claims to which a person making a will ought to give effect.
The Mental Health Act 2005 is now in force and has introduced significant changes in certain aspects of the law relating to mental health. However, insofar as testamentary capacity is concerned, the new provisions largely reflect the test set out in Banks v Goodfellow. Section 2 provides that "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". Section 3 explains that "…a person is unable to make a decision for himself if he is unable (a) to understand the information relevant to the decision, (b) to retain that information, (c) to use or weigh that information as part of the process of making the decision, or (d) to communicate his decision (whether by talking, using sign language or any other means)". Section 1 does, however, make an additional point that "A person is not to be treated as unable to make a decision unless all practicable steps to help him to do so have been taken without success".
The case of Banks v Goodfellow is therefore likely to continue to be relevant in cases concerning the validity of wills, subject to the additional consideration of whether or not "all practical steps" have been taken to assist the testator.
Generally, the burden of proving that a will is valid rests with the person seeking to prove the will (i.e. the person defending an attack on the validity of the will). That applies equally to proving that the testator had capacity, although the starting point is that the testator will be presumed to have had capacity, unless and until the contrary is proved. In reality, therefore, it will fall upon the person challenging the will to show that a testator lacked capacity. This will usually be attempted with reference to the testator's medical records or a report from their General Practitioner. For that reason, it is vital that professional try to follow the "golden rule" referred to in a number of cases, including Kenwood v Adams, namely that where there is any doubt as to a testator's capacity, the professional instructed should ask a medical practitioner to witness the will or give their opinion on capacity. The professional should also discuss any previous testamentary dispositions and the reasons for changes to them and should take instructions in the absence of beneficiaries, who might exert influence over the testator.
3 Lack of Knowledge and Approval
It may seem quite a straightforward requirement that a testator must know and approve the contents of any will executed. Indeed, a testator is presumed to have known and approved the contents of a will, which has been properly executed. However, three specific circumstances give rise to litigation under this heading:
(a) a mistake in preparing the will – where a mistake in the preparation of the will means that the will does not reflect the testator's instructions. If the will was signed without noticing the mistake, the testator might not have known and approved all of the terms.
(b) where the testator suffers from a condition, which might effect their ability to know and approve the contents of the will, such as blindness or illiteracy. Ordinarily, attestation clauses are adapted to deal with these specific examples. For example, in the case of an illiterate testator, the attestation clause should confirm that the will has been read to the testator. If no such steps are taken, there is a risk that the testator will not have known and approved the contents of the will.
(c) where the circumstances surrounding the preparation of the will excite suspicion. This is often used as the "catch all" category of probate claims. Where a will is prepared in "suspicious" circumstances, the burden is on the person trying to prove the validity of the will to remove the suspicions and prove that the testator knew and approved the contents of the will. Suspicious circumstances might include where the will in question was drafted by a principle beneficiary, or simply where there is little or no information available regarding the circumstances in which the will was prepared.
4 Undue influence
This is a particularly difficult argument to sustain in relation to the validity of a will because it requires the challenger to prove either coercion or fraud. Evidentially, this can be very difficult because the key witness – the deceased – will not be able to give evidence. Nevertheless, significant litigation has arisen from allegations of undue influence, particularly concerning the point at which a beneficiary's "assistance" with a will can become coercion. The case of Hall v Hall 1868 LR1 P&D 481 offers some guidance, suggesting that "a testator may be led but not driven; and his will must be the offspring of his own volition, and not the record of some one else's".
5 Forgery
Again, this is a difficult argument to run. It is a serious allegation and although the challenger will only have to prove the forgery on a balance of probabilities (i.e. 51%), a successful challenge on this ground will require some very persuasive evidence. These cases will often be won or lost on handwriting evidence, which is often inconclusive.
If a will is found to be invalid, probate can be granted in respect of a preceding will or, if there is no other will, the estate will fall to be administered in accordance with the intestacy rules.
Inheritance (Provision for Family and Dependants) Act 1975
Successfully proving the validity of a will does not eliminate the possibility of litigation. Certain classes of beneficiaries (or prospective beneficiaries) can still challenge the provisions of a valid will, codicil (or the provisions of dictated by the intestacy rules) under the Inheritance (Provision for Family and Dependants) Act ("the Inheritance Act").
The Inheritance Act is intended to help Spouses, children, civil partners, cohabitees and other surviving dependants of the deceased who have been left to cope without sufficient money to enable them to get by. If a will (or intestacy) fails to make ‘reasonable financial provision’ then they can make a claim under the Inheritance Act for an order effectively increasing their inheritance.
Any claim must be issued within six months of the date of the grant of representation to the deceased's estate, although the Court does have discretion to allow out of time claims. Importantly, no claim can be before the grant has been issued. There is therefore a very small window of opportunity for Inheritance Act claims to be issued.
For claimants other than spouses or civil partners, in considering whether or not the provision made for a claimant is reasonable, the Court will look at what is reasonable for their maintenance and will take account of the matters set out in section 3 of the Inheritance Act, including the financial needs of the claimant and the beneficiaries, the extent to which the claimant was maintained by the deceased, and the size of the estate.
Claims made by spouses and civil partners are dealt with in a slightly different way. In considering whether or not to make an award to a spouse or civil partner, the Court will look at what is reasonable and not just what is reasonable for their maintenance. The additional considerations for the Court will be the age of the applicant and the duration of the marriage, the contribution made by the applicant to the welfare of the family of the deceased and the provision, which the applicant might reasonably have expected to receive if on the day on which the deceased died the marriage, instead of being terminated by death, had been terminated by divorce.
This last consideration (what the applicant might have achieved on a divorce) is often taken as a starting point when calculating potential claims although the Court will consider all the issues set out above and will often depart from those financial provisions.
The case of Shah v Joshi is a good example of many of the different elements of contentious probate litigation.
(written by senior associate Craig Williams and featured in Entitlement - the newsletter of Title Research).
For more information on contesting a Will, please contact Craig in the litigation and dispute resolution team on 01753 279037 or email disputes@bpcollins.co.uk. |
