The perfect storm of increased property and asset values coupled with the complexities of family structures has led to an increase in contested Wills and inheritance claims. These claims can be pursued by disappointed beneficiaries under a Will or intestacy (on the grounds they have not been left reasonable financial provision, even if left something) or those excluded completely from an estate.
The recent difficulties experienced by many in preparing and executing Wills during the Covid-19 pandemic will further contribute to this rise in claims in the longer term. Disappointed individuals are likely to challenge the validity of Wills for lack of capacity on the part of the testator, incorrect execution by witnesses, undue influence and even forgery. Factors often overlooked by testators when preparing homemade Wills include the potential for claims by ex-spouses and children from earlier marriages (adult or minor). Unmarried couples can still be misinformed as to their rights to inherit non joint assets from their partner on their death. There can be tax liabilities that arise where consideration has not been properly given to the value of assets passing to non-exempt beneficiaries under a Will or trust. Succession planning for family businesses can also be overlooked or inadequately provided for.
While claims cannot be absolutely prevented in advance (anyone may try and bring a claim irrespective of their prospects) the best strategy is to seek professional advice when preparing a Will to mitigate the types or strengths of claims that could be on the horizon. Remember that family relationships can sadly but easily break down once a key figure dies and lots of individuals believe they are ‘entitled’.
There is some helpful reading on our Private Wealth COVID-19 hub, looking at specific arrangements you can put in place regarding passing on assets, including family businesses here. For more information about family governance procedures you can put in place ahead of death or incapacity, please click here.
The number of contested wills being heard at the High Court reached an all-time high in 2019, at 188 cases — an increase of 47 per cent on 2018, according to figures released by the Ministry of Justice.