Three years after the Supreme Court decision in the high profile case of Illot v Mitson, which finally determined a decade long claim brought by an adult child under the Inheritance (Provision for Family and Dependents) Act 1975 against the RSPCA, RSPB and the Blue Cross, a charity again finds itself defending a challenge to a will brought by a disgruntled child, this time the RNLI.
Sonya Young, the daughter of the deceased, Brian Cole, issued court proceedings to set aside her father’s will when she learned that she had been left £5,000 of her father’s £300,000 estate. The RNLI, which had been left the lion’s share of the estate successfully defended the claim at trial.
The deceased had previously served as a lifeboat man in Penarth and had made two previous wills. The first in 2008 left the majority of the estate to his daughter, the second in 2012 left the majority to his partner and largely “disinherited” his daughter. The third and final will, left the majority of his estate to the RNLI and was executed only 44 days before the deceased committed suicide.
Mrs Young challenged the 2013 will on the basis that her father lacked the capacity to make a will when he executed it and as a result, it should be set aside. As the Judgement was not published, it is not clear whether Mrs Young also sought to set aside the 2012 will on the same grounds, as that would be the only way in which she would inherit, as it would leave the 2008 will as the deceased’s last valid will and testament.
The case reached trial in July 2019 and the Judge found that the deceased had been in his right mind when he executed his 2013 will, evidenced by the letters he had written to Ms Young to explain his actions, and that the solicitor who prepared the will was experienced and had known the deceased for 8 years.
Mrs Young, who was still holding the deceased’s funds and was ordered to immediately transfer the sum of £214,000 to the RNLI, being the balance in her account, together with a further sum of £54,000 which she had dissipated. Mrs Young was also ordered to pay the RNLI’s costs.
The case came before the court again this week to hear an application issued by the RNLI to place a charge upon Mrs Young’s home to secure the outstanding sum of £54,000. The court approved the order and therefore if the additional sum is not paid, the RNLI will be able to enforce the charging order by making a further application to the court to sell Mrs Young’s home.
There are a number of lessons which can be learned from this case for those who wish to make a gift to a charity in their will;
- It is essential that if you are making a large gift to a charity, at the expense of a member of your family, that you seek the assistance of an experienced solicitor to draft the will. In this case, had the will been prepared by Mr Cole himself using a home drafting kit or a telephone or internet will service, it is likely that Mrs Young would have succeeded in her claim.
- A letter of wishes should always be prepared when making the will to explain your reasons for making the gift, particularly if it is at the expense of someone who may expect to inherit. The letters prepared by Mr Cole in this case were of significant importance when it came to determining Mrs Young’s claim and without them, the result may have been very different.
- Where possible, discuss with your family the contents of the will and explain your reasoning. Had Mr Cole done so, his daughter may not have formed the view that he lacked capacity to make the decision he did, and the case may have been avoided entirely.
There are also lessons which can be learned for charities who may be faced with a similar situation;
- When embarking upon campaigns to encourage gifts within wills, highlight the importance of a will being prepared by a solicitor, the preparation of a letter of wishes, and encourage discussions within families of the gift which is to be made and the reasons why.
- The RNLI were lucky that Mrs Young owned a property upon which they could place a charge to secure the shortfall of £54,000 which Mrs Young had dissipated. As soon as a charity is aware that it has been left a gift within a will, it should immediately;
- Seek confirmation of where the monies are being held;
- If the funds are not being held by a solicitor and are being held in the account of a beneficiary, insist that they are transferred to a solicitor, or if none are instructed, to the executor(s).
- If the funds are being held by an executor in their personal account, and no solicitor is instructed, insist that they open an Executors Account and transfer the money into it. If concerns remain, consider making an application to the Court to remove the executor and if necessary, a further application to freeze their account or require a payment into court until the determination of the application.
- If it appears that there may be a dispute in respect of the estate;
- Insist that the deceased’s funds are paid into a solicitor’s account and request an undertaking from that solicitor that the funds will not be distributed unless an agreement is reached, or a court order obtained;
- Consider an application to freeze the account of the person holding the funds if they refuse to transfer to their solicitor;
- Once proceedings have been issued, an application can be made for the person holding the funds to pay them into court, if there is a fear of dissipation.
- When considering that a charities’ main goal is to do good, from a public perception standpoint, it would be far better for a charity to take early action to preserve an estate by removing executors, obtaining freezing orders and/or obtaining payments into court, rather than seeking to sell a claimant’s home to recover sums which have been dissipated. It is therefore essential that specialist advice is obtained at the earliest possible opportunity.
How can Geldards help?
If you have any concerns regarding a gift you wish to leave to a charity, or you are a charity and are concerned regarding a potential dispute or the dissipation of estate funds, please contact Laura Alliss who leads our contentious probate team and will be happy to help.
RELATED: CHARITY & NOT-FOR-PROFITDISPUTE RESOLUTION