The case of Ilott v Mitson began in 2007 and has become familiar to many via the national press. Nine years later, the case came before the Supreme Court and marked the first time the highest UK Court has been asked to consider the Inheritance (Provision for Family and Dependants) Act 1975.
By way of reminder, our previous article discusses the detail and history of the case.
In effect, the Supreme Court was asked to decide which of the previous decisions represented the correct award and application of the legislation. Was District Judge Million in the County Court right to award £50,000 or was the Court of Appeal correct to make housing provision of £146,000 for Mrs Ilott with an additional fund of £20,000?
Jasmine Davis from the Disputed Wills & Trusts team attended the hearing to observe how matters unfolded.
The case for the charities
Penelope Reed QC appeared for the charities.
- District Judge Million was correct to make the award of £50,000. This provided Mrs Ilott with a capitalised sum to represent a modest additional income. There was a reduction made to reflect the estrangement between the parties and Mrs Ilott’s, albeit limited, financial independence. The impact of the award on Mrs Ilott’s state benefits should not defeat the award.
- The charities did not submit a case in relation to their needs. Ms Reed submitted that charities are not considered to be ‘special’ beneficiaries under the 1975 act. There was no obligation for the charities, as chosen beneficiaries, to prove their case.
- There had been criticism that Mrs Jackson and the charities did not have a lifetime connection. It was submitted that this is irrelevant as Mrs Jackson had the testamentary freedom to choose her beneficiaries.
- The award of a house exceeded the standard of reasonable financial provision that was envisaged by the 1975 Act. It was the charities’ case that ‘maintenance’ should be somewhere between subsistence and comfort and allow the recipient to discharge their daily needs/expenses. The award of a house far exceeded this.
The case for Mrs Ilott
Brie Stevens-Hoare QC was lead Counsel for Mrs Ilott.
- The 1975 Act is clearly designed to limit testamentary freedom. Once the threshold of being eligible under the 1975 Act is satisfied, the legislation is intended to supplement testamentary freedom.
- The Court of Appeal judgement did not create uncertainty and was the correct approach. A claim by an adult child should not create additional hurdles. Whilst successful adult children claims are rarer under the 1975 Act, they do not have to meet an elevated threshold.
- It is important that maintenance is not rigidly defined and in some cases this may include the provision of a property. The provisions were not designed so that maintenance could reduce dependency on state benefits (as was the effect District Judge Million’s award).
- There was a question as to whether the Court of Appeal should have re-considered the financial position at the date of the first instance hearing in 2007 or at the date of the appeal. Ms Stevens-Hoare argued strongly that the provisions of the 1975 Act allow for the finances to be considered at the date of the subsequent hearing. Technically the passage of time had benefitted the charities as the cost of purchasing Mrs Ilott’s home had decreased and was in fact £122,000.
What can we expect?
Judgement has been reserved and is not expected until the New Year. There was some interesting discussion by the Justices as to whether charitable beneficiaries should submit a case for their needs and whether this should consider the needs of their ultimate beneficiaries or objects.
The Court is likely to make some comment as to the exceptional nature of the facts in this case, particularly in view of the implication of awards for claimants in receipt of state benefits.
Practitioners would welcome more guidance regarding the application of the ‘maintenance’ provisions, however whilst we can speculate, it is really a case of sitting tight and waiting for the judgement.
For more information, please contact Tony Cockayne, Partner and Head of the Disputed Wills & Trusts team at email@example.com.