Avoiding the escalation of estate disputes
With Wills being disputed more now than ever before, Trowers and Hamlins explore why this is happening now and if it can be avoided.
In late 2022 it was reported that there had been a rise in inheritance disputes compared to the previous year. This is a trend that seems to be continuing. Since the start of 2023 we have seen a number of cases hit the headlines. The ones reported by the media have involved disputes between family members that have escalated to a final hearing. It is inevitable these disputes would have cost the parties involved huge sums of money, time and emotional distress.
One of these cases was the case of Kaur v Singh. The dispute involved a married couple and upon Mr Singh's death the couple had been married for around 66 years. They shared 7 children, 6 of whom were surviving at the time of Mr Singh passing away. Throughout the marriage Mrs Kaur played a vital role both as a wife and working in the family clothing business. Mrs Kaur had no shareholding in the business and did not receive a salary. She was entirely financially dependent on Mr Singh and he met all of the outgoings of the family. The Court deemed Mrs Kaur had clearly made "a full and equal contribution to the marriage". At the time of the proceedings being brought Mrs Kaur was 83 years old, her sole income was benefits of approximately £12,000 per year. Since her husband's death she no longer lived at the family home and was living with one of her daughters. The wealth held by her husband was accumulated during the marriage and the estimated value of the estate was just under £2 million which comprised of the family home, a small residential property portfolio, a commercial property and some land and property owned in India. The Will left by Mr Singh expressed that his wishes were to leave his estate to the male line of the family, meaning the estate would fall to the two sons he shared with Kaur. The Court awarded Kaur 50% of the net value of the estate as it was clear that an inadequate financial provision had been left for Kaur from Singh.
Another case that has also been in the news is the case of Morton v Morton. The summary of the dispute is that the daughter was appointed as the executrix of her parents' estate. The son worked on the farm, which forms the majority of the estate, for the large part of his working life. After their father died in 2001, the son continued to work on the farm with his mother until she passed away in 2015. Between 2001 and 2015 it was understood that the mother and son had owned half of the farm each. The son understood that he would inherit the farm when his mother passed away but she had changed her Will to leave her estimated £2million share to her daughter, who had not worked on the farm as her brother had done.
This claim has made its way to the High Court where the sister was ordered to pay over half of her inheritance. The matter then continued, and the son was ordered to hand over approximately £700,000 representing interest on the sister's share of the farm since 2016. This decision was then overturned, and the interest did not have to paid as the sister was not entitled to interest. It is not clear if there will be any further appeals in this claim but one aspect of the claim that is clear is that both parties have invested huge amounts of time and financial investment into this matter and having it resolved through the courts.
The main issues with cases such as these are that at the heart of them is usually a very close, personal, and longstanding relationship. There is often an assumption of what will happen when a person passes away or an assumption that someone will "do the right thing" rather than there being any specific agreement in place. It may not be appropriate for all issues to be documented but the clarity and certainty that well drafted documents provide is of huge value to executors, trustees and beneficiaries. It is important to remember that if a person's estate involves business interests then documents in addition to a Will may need to be put in place. This might assist with avoiding disputes such as the ones above. It may also be beneficial to have conversations with those close to you as to the wishes set out within your Will so as and when the time comes it is clear how you would like your estate to be dealt with. A clear letter of wishes can go a long way to assisting executors and trustees and explaining to beneficiaries why certain decisions have been taken.
To avoid long running and costly disputes, we can assist you with assessing the claim and reviewing the prospects and the options available to you. The best option for a claim is not always to issue court proceedings. Due to the high level of emotion and cost that can be involved in these matters we attempt to resolve as many issues as possible with the other parties and exploring alternative dispute resolution options. In our experience, communication is key. To try to avoid situations such as the recent cases, we would suggest that if you are the party administering the estate you provide those that are alleging they are entitled to a part of the estate an opportunity to set out what they believe they are entitled to and why. Addressing and listening to people's concerns can often take the heat out of a situation rather than an adversarial approach. We would then suggest you seek legal advice from a specialist team such as ours, on the administration of the estate and the possible claim from third parties.
Whilst we are not able to guarantee that if you follow the steps set out above you will avoid encountering any dispute relating to an estate you may be an executor for, we can assist you with engaging with third parties at the early stages and avoiding incurring large amounts of legal fees until alternative options to resolve the dispute have been explored first. Our team based nationally across our offices have vast amounts of experience in dealing with these matters with assets held across the world and in different formats, including digital assets.
Disputes over estates will always be an issue but good communication both before and after death can often assist in preventing those disputes escalating and decimating the value of the estate and family relationships.
 Morton v Morton CA (Civ Div), 20 June 2023  EWCA Civ 700,  6 WLUK 235 Reversing  EWHC 2689 (Ch),  9 WLUK 398