Litigation About Wills Trusts And Probate Seminar 6/11/12


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Litigation About Wills Trusts And Probate Seminar 6/11/12

  1. 1. Litigation about Wills, Trusts andProbateTuesday 6 November 2012
  2. 2. Litigation about Wills, Trusts andProbateChris GreenwellScott McKittrickClaire HerbertNatalie Howes
  3. 3. what we want to tell you about• The kinds of dispute which arise out of the preparation of Wills, Trusts and Probate• Consequences of the failure to give enough thought to them when preparing the Will• Consequences of the failure to make provision for the right people• How these problems are put right after the event
  4. 4. these issues will be divided into: • The right steps before death • Common problems after death • Starting a claim • Miscellaneous types of case that happen
  5. 5. some overarching rules aboutacting on behalf of Estates• Don’t write letters that might look bad later• If you have a case, get on with it• Advise objectively; sometimes the ‘hard word’ has to be delivered• Properly drafted Wills (or having Wills at all) avoid claims• Keep a clear record of whatever you tell or discuss with your client or their family• Plan in advance e.g. deal with affairs while client/testator is of sound mind
  6. 6. when your client wants a Will• Clearly establish assets and liabilities• Find out clearly what the testator wants• Make sure the testator understands what he wants• Keep clear notes of what you discuss especially ‘off the wall’ plans• Make sure you get your client to get on with it, especially if the client is approaching the end• Go to the solicitor with your client
  7. 7. if you do prepare Wills have achecklist to make sure they are valid• Comply with Section 9 of the Wills Act 1837 - signatures, witnesses, dates• Make sure witnesses are not beneficiaries or spouses of beneficiaries• Make sure the testator has capacity• Rectifying (putting mistakes in Wills right later) is expensive and likely to give rise to negligence claims
  8. 8. after death; challenging the Will• Failure to properly execute the Will • Intestacy • Prior Will prevails• Undue influence, fraud or mistake• Want of testamentary capacity• Want of knowledge or approval; the court to be satisfied that the testator knew and approved the contents of his Will
  9. 9. failure to observe formalities• Will must be written and signed• Testator must plainly have intended to make his Will• It must be witnessed by two witnesses together and signed or acknowledged by them in one another’s presence
  10. 10. undue influence• Coercion of any variety; deprivation of freewill• Presumed in some relationships; solicitor/client, doctor/patient, priest/parishioner• Fraud • Lying to procure a disposition • Forgery of a Will (Harold Shipman for example) • Impersonation of testator
  11. 11. want of testamentary capacity •Even after all this time, the test goes back to 1870 (Banks -v- Goodfellow) “It is essential that a testator shall understand the nature of his act and its effects; shall understand the extent of the property of which he is disposing; shall be able to comprehend and appreciate the claims to which he ought to give effect and with a view to the latter object, that no disorder of the mind shall poison in affections, pervert his sense of right, or prevent the exercise of his natural faculties, that no insane delusion shall influence his will in disposing of his property and bring about a disposal of it which if his mind had been sound, would not have been made”
  12. 12. want of testamentary capacity• Some examples of what does not necessarily affect capacity would be:- • Drunkenness • Deafness and dumbness; and • Loss of faculties after the making of the Will
  13. 13. want of knowledge and approval• This is where those who have ‘suffered’ try and establish that there are suspicious circumstances which ‘excite the suspicion of the court’• Fertile ground for claims are:- • Person helping to get the Will executed benefits • Part of the Will is covered up • Person benefiting fails to give evidence as to execution
  14. 14. want of knowledge and approval • There is misuse of a foreign language • Deaf and dumbness • Witnesses corralled by the principal beneficiary • Any one dealing with the Will preparation has to exercise the ‘golden but tactless rule’ which translated into plain English means ‘I am not sure you are all there so I am going to get a doctor to check’
  15. 15. you are not happy with the Willor issues in the Estate?• What do you do?• Citations • To take out Probate. This is to force proper administration of the Will (for example in an intermeddled estate (Devastavit) • A citation to force the taking of a Grant if someone should be administering an estate but will not
  16. 16. you are not happy with the Willor issues in the Estate? • To propound the Will or prove it in solemn form - for example if the Will is suspicious the executor or beneficiary is forced to prove the validity of the Will • Citations are rare in practice. They are slow and expensive and they in effect attempt to force the taking of action by people who have already proved unreliable
  17. 17. you are not happy with the Willor issues in the Estate?• The more likely practical step is:- • Subpoena to delivery up Will • Subpoena parties likely to know about the Will or its whereabouts; or • Proceeding by caveat and or litigation • Investigating execution of the Will ‘Larke -v- Nugus’
  18. 18. caveats• These are used to prevent a party taking out a Grant of Probate or letters of administration (in intestacy)• They effectively block the estate until your issues are resolved or litigated• If agreement is not reached in practice either: • The aggrieved party backs out of his claim and withdraws the caveat; or • The aggrieved party gets on with the argument about the estate
  19. 19. caveats• Caveats can also be used to try and establish a contrary interest for example, the right to be administrator under an earlier Will or a claim of intestacy if the Will is invalid or if a Will cannot be found
  20. 20. after the Grant• A common argument is the Trustee/Executor is not doing his job properly. Putting this right is a last resort. It is costly. The remedies (broadly in order of cost are) • Section 50 Administration of Justice Act - Application to replace Trustee • Administration Action - to appoint a completely independent administrator (similar to a court appointed receiver or insolvency practitioner) to administer the estate
  21. 21. after the Grant • To appoint a Judicial Trustee. A Trustee appointed by the court. • Application for ‘inventory and account’, to demand the Trustee accounts for what he has done with the estate’s money
  22. 22. revocation and rectification • Torn up Wills • Crossed out Wills; interlination • Rectification - used to put a mistake or fraud in a Will correct, or rectify failure of the Will draftsman to properly reflect the testator’s intent • Construction claims - claims, often conflicting with rectification claims for construction of the words used in a Will.
  23. 23. costs• Legal costs are in 80% of claims the ‘elephant in the room’• There are a number of broad rules to remember in Probate:- • Costs are not always paid by the deceased’s estate • If executors fend off a claim they will usually get their costs paid by the estate • Any losing party (including executors) may have to pay costs personally even though they are not arguing about their own money. This risk needs to be insured
  24. 24. costs• Alleging fraud or undue influence is done at your peril; if you do so without good cause your exposure to costs is vastly increased• Broadly speaking, it is always better to settle than fight by either:- • Mediation; or • Making an offer intended to shift costs risks
  25. 25. costs• ‘No win, no fee’ (Conditional Fee) cases and insuring the risk of losing are always an option in contentious probate or inheritance act claims• Claims should always be started by an informal Contentious Probate Protocol and there are cost sanctions for failing to do so
  26. 26. Inheritance Claims (InheritanceProvision for Family Independents) Act 1975(IHA)• A testator needs to understand the claims to which he ought to give effect (as the Judge said in 1870 in Banks -v- Goodfellow)• This Act is how the law is used to provide for people who in simple terms, in conscience, should have benefited but did not from the testator’s estate
  27. 27. advance planning• A statement accompanies the Will which sets out (with good reason) why provision is not being made or is limited• Consider making reduced provision in the Will which may later render IHA claims commercially difficult to bring• Mutual Wills which do not make proper provision are relatively easy to override• Wills should not contain uncertain provisions for example ‘I leave x such amount as the court would award under IHA’
  28. 28. who is eligible?• Domiciled in England and Wales• Claim to brought within six months of Probate• Spouse• Former spouse who has not remarried• A cohabitee• A child or person treated by the deceased as a child (NB adult children must show dependency)• Any person who immediately before the death was wholly or partially maintained by the deceased
  29. 29. what are they eligible for?• For spouses; reasonable financial provision irrespective of need• For everyone else; the provision needed for their maintenance• The court can order maintenance payments, lump sums, property transfers, property orders as it sees fit and variations of existing orders
  30. 30. how does the court decidewhat is reasonable• Likely foreseeable financial needs and resources• Likely claims of any other party• The needs of the beneficiaries• The obligations of the deceased to the other parties• The amount in the Estate
  31. 31. how does the court decidewhat is reasonable• Any disabilities of the applicant or beneficiaries in the estate• Any other matter including conduct which the court considers relevant• In spouse cases: • Age and duration of marriage • Contributions made to the welfare of the family
  32. 32. no shortcuts in assessinga case• Establish eligibility• Consider by reference to each of the factors where the reasonable financial provision has been made• If it has not been made what provision should be made?• We do this in a checklist• The court gives weight to certain special factors
  33. 33. no shortcuts in assessinga case• Promises made by the deceased• Statements made about provision by the deceased• Conduct. You think this is likely to be salacious but in practice it is very dull• Adult children cause particular difficulties• Spouses generally have much higher reasonable financial provision needs
  34. 34. miscellaneous cases• Enforceable promises to leave property by Will• Estoppel. A promise made to a beneficiary by a deceased reneged upon in the Will• Murderers - cannot inherit. However other killers can apply to benefit within three months of death• Insolvent estates (note - freezing of assets in attempt to dissipation)• Intestacy• Professional negligence ‘White -v- Jones’
  35. 35. questions