Where There's a Will
Thursday 8th December 2011
Julian Gibbons on why you might not be able to leave it all to the dogs’ home. Anyone who has bought property in France will know that the process can be drawn out and time consuming. Not only this, but if you decide you want to make a French will dealing with the property then some real problems arise. French law imposes some significant restrictions on the disposal of an estate. The law imposes what is known as a reserve, which earmarks anything from one quarter upwards of the estate for children and the surviving spouse. For example, on the death of a husband or wife leaving two children and the other spouse, only one twelfth of the estate is freely disposable by will. Similar provisions are found in other jurisdictions such as Spain and Italy.
This system can come as a surprise to those used to English rules on inheritance. Indeed, to say there are English rules at all is perhaps over stating the position, as under English law a person is free to dispose of the entirety of their estate however they wish. Spouses are free under the common law to disinherit each other and all their children; they can leave their families with nothing and give it all to charity.
Recognising that the strict legal position can cause real injustice and unfairness, parliament has passed from time to time various pieces of legislation to redress the balance. These acts do not take the continental route of requiring parts of the estate to be earmarked for particular classes of relative. Rather, they give classes of people a right to apply to the court for provision to be made from an estate where the will or the rules on intestacy to not provide adequately for them.
Although there are a number of classes of person who can apply, the present act (the Inheritance (Provision for Family and Dependants) Act 1975) applies more usually to spouses and those who have lived together as husband and wife for at least two years. The one other significant category of persons who may try and apply under the act are children, often adult children.
When considering provision for spouses, the court has to have regard to what that spouse would have received had the marriage terminated on divorce rather than death. This usually means starting from a position of a 50:50 division of joint assets. In the case of other possible claimants, the court’s powers are more restrictive and the court awards such a sum as it considers is required for his or her maintenance. This last provision has caused more than a little disappointment for adult children, who have been in turn surprised, disappointed and angry that a father or mother has left them nothing. In fact, the Inheritance Act will help them little unless they were financially dependant before the parent died.
Any possible claimant against an estate needs to act swiftly. Because of the need to administer an estate quickly, claimants have only six months from the grant of probate or administration to file a claim. To ensure that they do not miss the deadline, it is possible to register a notice at the probate registry which ensures that they are notified when a grant of probate is taken out.
From the point of view of anyone making a will, they need to have regard to the Act. An attempt to disinherit a person such as a spouse, who will have a claim, is counter productive. A will should make adequate provisions for those who are likely to have a claim. The alternative will be an estate which may be substantially reduced by the legal costs of the executors and others in fighting a claim.