UK Supreme Court reduces daughter’s reasonable provision award

The UK Supreme Court reaffirmed the general principle of testamentary freedom in unanimously setting aside a Court of Appeal decision to award an estranged daughter about a third of her late mother’s £486,000 estate, which had all been explicitly left to three animal charities.

In Ilott v The Blue Cross and others 2017 UKSC 17, Heather Ilott’s mother, Melita Jackson, drafted her will and a letter of wishes, to ensure that Ilott would not receive anything from her estate. The two had been estranged for many years and Jackson had provided no financial support after their estrangement.

Following Jackson’s death in 2004, Ilott made a claim against her mother’s estate under the Inheritance (Provision for Family and Dependants) Act 1975, which allows a court to grant a deceased person’s children an award for ‘reasonable financial provision’ from the estate. Ilott’s claim was opposed by the three charities named in her will.

At first instance in 2007, the County court awarded her £50,000 on the grounds that her mother had acted in an “unreasonable, capricious and harsh” way. Ilott appealed this amount as too low, and there followed two further hearings in which the award was first struck out entirely and then reinstated.

In July 2015, the case reached the Court of Appeal, which decided that sum was insufficient and increased it to £143,000 to buy a property with a cash sum of £20,000 to provide additional income. It overturned the first instance decision on grounds that the district judge had limited the award unfairly by reference to Ilott’s limited means and living expenses, and that he had failed properly to investigate the effect of the award on her benefits entitlement. The three charities appealed, arguing that Ilott’s award should be reduced to the original £50,000.

The Supreme Court unanimously set aside the appeal court’s decision, holding that the district judge had not made any of the errors identified. He had considered all the factors set out in s3 of the 1975 Act and had been entitled to take into account the nature of the relationship between Jackson and Ilott. Further, he had addressed the impact on Ilott’s benefits, and decided that much of the £50,000 award could have been spent on essential household improvements, which fell within the provision of maintenance of daily living, and would have avoided Ilott retaining sufficient capital to disqualify her from means-tested state benefits.

The Supreme Court was critical of the 1975 Act’s wording, noting that 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. The judgment stated: ‘It may be less obvious, but is also true, that the circumstances of the relationship between the deceased and the claimant may affect what is the just order to make. Sometimes the relationship will have been such that the only reasonable provision is the maximum which the estate can afford; in other situations, the provision which it is reasonable to make will, because of the distance of the relationship, or perhaps because of the conduct of one or other of the parties, be to meet only part of the needs of the claimant.”