In March 2017 the Supreme Court handed down judgment in Ilott v The Blue Cross and Others in the first case under the Inheritance (Provision for Family and Dependants) Act 1975 (IPFDA) to reach the highest court.
This was an appeal that arose out of a claim for reasonable financial provision under IPFDA brought against the estate of Mrs Jackson by her daughter Mrs Ilott. The pair had been estranged for the majority of the 26 years before Mrs Jackson’s death in 2004. The estrangement began when the daughter left home to live with her boyfriend, now husband when she was 17. Mrs Ilott has lived independently of her mother with her husband and five children but in challenging financial circumstances and receiving benefits of an annual income of £20,000.
Mrs Jackson did her last will in 2002 bequeathing the majority of her estate to a number of animal charities and made no provision for her daughter. Even in 1984 Mrs Jackson had made no provision for her daughter in her will and Mrs Ilott knew this and had no expectation of benefit from the estate.
The District Judge found that Mrs Jackson’s will did not make any reasonable provision for Mrs Ilott and awarded her £50,000. The charities who were beneficiaries in the will challenged the finding that there was any lack of reasonable provision but that challenge failed and the dispute has proceeded on the quantum awarded to Mrs Ilott.
In the Court of Appeal, the Judges decided that the District Judge had erred on two points in his calculation:
- Initially he held the award should be limited in light of the long estrangement and lack of expectation of benefit but did not identify what the awared would have been without these factors and the reduction attributable to them.
- He made his award without knowing what the effect would be on Mrs Ilott’s benefits, some of which would be means-tested and would not be payable once Mrs Ilott’s savings were over £16,000
The Court of Appeal re-evaluated the claim and awarded Mrs Ilott £143,000 to buy her house and an option to receive £20,000 in one or more instalments to prevent the awards affecting Mrs Ilott’s benefits’ entitlement.
Judgment of the Supreme Court
Overturning the Court of Appeal’s judgment, the Supreme Court unanimously allowed the charities’ appeals and set aside the Court of Appeal’s order and restored the District Judge’s order of £50,000.The kernel of the decision was that the Court of Appeal had no proper basis for interfering with the judgment made by the District Judge and that the broad brush approach adopted by the District Judge was correct. The Supreme Court emphasised the importance of limiting awards to adult children to “maintenance”, highlighting that the purpose of the Act was NOT to provide legacies to an applicant. Reasonable provision for maintenance does not mean providing everything that the applicant reasonably needs but requires a single assessment by the judge and this assessment may be weighted by any of the factors in section 3 of the IPFDA, including estrangement; here the circumstances of the relationship and estrangement between Mrs Ilott and Mrs Jackson carried weight.
Lady Hale in her judgment reviewed the history of the Act and preceding legislation, commenting on the unsatisfactory state of the law where it gives no guidance as to the weight of the factors to be taken into account in deciding whether an adult child is deserving or undeserving of reasonable maintenance. At the moment, the approach is of a value judgment which could be problematic as there are wide varying opinions in judiciary and public opinion as to the circumstances in which adult descendants ought or ought not to be able to claim on an estate.