Will you be disinherited? A guide to the Inheritance (Provision for Family and Dependants) Act

A will can be challenged on many grounds including want of (formal) execution, the testator’s capacity (or lack of) and undue influence, but one question we are often asked is: “what can be done when someone has been ‘cut out’ of an otherwise valid will?”. 

In many scenarios the answer lies in a piece of legislation called the Inheritance (Provision for Family and Dependants) Act 1975; enacted to prevent the socially unconscionable effects of unrestricted will writing and, sometimes, the effect of the intestacy rules. Put simply, the I(PFD)A affords some protection to those who have been financially dependant on the deceased. 

For good reason the Act is restricted to applicants who can demonstrate that they were financially dependant on the deceased and experience shows that the more successful applicants tend to be spouses, ex-spouses, partners (i.e. those living as the husband or wife of the deceased) and children (minors). 

If an applicant makes a successful challenge to the will then the I(PFD)A will ensure that “reasonable financial provision” will be made from the estate. The Act sets out a list of factors for which the court should have regard in determining what award should be made; the award can also come in many guises and can include an absolute capital sum, an income from the estate, a life interest in property or a combination of awards. 

The legislation allows for two classes of award to be made the standard ‘maintenance’ award and the higher, non-maintenance standard of provision. With its feet firmly in principles of equity, the Act seeks to do what is right by all the parties; it will not seek to punish other beneficiaries for the testator’s choice to prefer them over those financially dependant on the deceased. 

The standard award under the I(PFD)A is for "such financial provision as it would be reasonable in all the circumstances of the case for the applicant to receive for his maintenance". The courts have interpreted this as meaning that the award (if any) should be an amount that it would be “reasonable for the claimant to live on, at neither a luxurious, nor poverty stricken level”. Invariably a checklist of the claimant's assets, liabilities and needs (both now and in the future) will be drawn up and the award will have due consideration such to ensure that a successful claimant does not spiral into poverty nor live the “life of Riley”. 

The higher, non-maintenance, award is reserved for spouses, civil partners and some former spouses/civil partners. In terms of the award, legislation provides that it will be based on what it is “reasonable for the claimant to receive, whether or not that provision is required for that person's maintenance”. In other words, spouses (and others who qualify) are not tied by notions of ‘maintenance’ and, when considering all the relevant factors, the award should be one which a claimant could legitimately expect to receive, opulent lifestyle or not! 

The award to a successful claimant will come from the net estate and usually at some form of ‘detriment’ to the named beneficiaries, but in some cases the provision of an I(PFD)A award can be used to mitigate the Inheritance Tax liability. Whilst tax mitigation should not be used as a ground to bring a claim against the estate for reasonable provision (there are many other possible mechanisms to achieve such aims) it may minimise the ‘loss’ to the intended beneficiaries. 

Claims by those ignored under a will should be brought as soon as possible. The default position is that an I(PFD)A claim should be brought within 6 months from the date of the Grant of Probate unless there are good grounds for bringing claim outside this timeframe. In exceptional cases the court will allow an I(PFD)A claim years after the Grant of Probate. In Re McNulty the application was 3½ years out of time but allowed nonetheless, that said, the sooner the better. 

In other words, if you have been ‘cut-out’ of a will then there is somewhere to turn; Lisa Cox offers expert guidance on bringing a claim under the I(PFD)A and specialises in contested trusts and probate. Contact her via her profile.