Interim orders under the Inheritance (Provision for Family & Dependents) Act 1975

 In Probate

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Should the Court provide an interim financial award when the estranged spouse argues to be in special financial need? Does the Court have jurisdiction to permit occupation of the deceased’s property pending the making of the final award in probate action? Smith v Smith [2011] EWCA 2133 considers the position under the Inheritance (Provision for Family & Dependents) Act 1975 (IPFD).

The facts

Mr Thomas Joseph Smith (Mr Smith) died on 23 July 2009 married to Mrs Olga Smith (Olga). At the time of his death he was the sole legal and apparently sole beneficial owner of his house.

He married Olga, who came from Russia, in 1991 and they lived together in the house. By 2003 their marriage was in difficulties and Olga regarded herself at that time as separated from Mr Smith. She returned to Russia to look after her terminally ill mother.

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Shortly after the marriage Mr Smith made a Will in which he left some small legacies to his nephews and nieces but the bulk of his estate was left to Olga, who claimed that this was what was promised in return for looking after him.

During the period following the separation in 2003 Olga claimed that she came back to the UK from time to time and stayed at the house to look after Mr Smith who was allegedly by then behaving strangely towards her such that she sought a divorce based on his unreasonable behaviour. He asked her not to divorce him and at the date of his death the divorce proceedings had not been continued.

In 2005, while Olga was in Russia, Mr Smith made a new Will in which he left his property amongst his family i.e. his siblings, nephews and nieces, and excluded any benefit for Olga. The estate on death comprised the house valued at £350,000 and other assets which by the time of the hearing had been encashed and were worth approximately £175,000.

Olga challenged the later Will on the basis that Mr Smith did not have testamentary capacity at the time he made it and that it did not make the provision for her that he had promised. The probate case is scheduled to be heard in January 2012. This case was an application for interim orders as to occupation of the house pending the hearing of the probate case and for an award of £25,000 on account as allowed for under s.5 IPFD.

Consideration of the merits

Mr Justice Mann analysed the evidence of Olga in support of her probate action. He commented that she presented virtually no evidence in support of her argument that Mr Smith lacked testamentary capacity at the time he made his last Will. It was based on her description of a pattern of irrational behaviour but no-one else witnessed this and Olga was out of the country when the Will was made.

In hindsight she argued that as it was found at Mr Smith’s post mortem he had a brain tumor this was consistent with her argument that his behaviour was irrational since brain tumor are known to affect behaviour. However, none of the family of Mr Smith, his doctor, the solicitor who took the instructions for the Will and an expert who has looked at all the medical evidence can find any evidence of lack of capacity.

The argument was made that as a widow from a marriage for over 10 years she would be entitled to an award under the IPFD and despite the start of divorce proceedings Mr Smith did not wish them to be continued. Had they been pursued Olga would have undoubtedly have achieved some provision on divorce. It was therefore likely that the IPFD claim would result in some success. This in turn meant that an interim order based on necessity should be considered.

The Judge felt that there was only a thin case presented as far as need was concerned. Olga’s written evidence about her financial position was almost non-existent and she did not help herself in the giving of her oral evidence. She refused to answer any questions about her means and came across as combative.

Clearly the court felt that a strong case of need had to be established in order to make an interim order based on necessity since otherwise monies might be paid over which eventually the applicant may not be entitled to and which would be difficult to recover.

The only evidence of means presented suggested that Olga received a state old age pension; an occupational pension of £101.84 per month and £4,000 bereavement benefit.

In fact, evidence was presented of other accounts which had been in existence back in 2003 with Barclays Banks, Citibank US Dollar account and Woolwich Guernsey account, all of which Olga denied were still available. The judge clearly did not believe her.

Olga also said that she lived off loans from friends in Moscow which were secured against a flat she owned there. No supporting evidence was presented to establish the details.

The decision

Mr Justice Mann was unsurprisingly not satisfied on the basis of Olga’s evidence that she was in immediate financial need. He was convinced that there was non-disclosure of material assets and material income.

As to her wish to reside in the property pending the hearing of the probate case, this was also denied since it was acknowledged that her family were in Russia and she had friends there but not here. There was no evidence that she wished to move the centre of her life to here.

Since he felt that she did not require the property as a residence (despite the fact that she was otherwise living in a hotel) he felt that if she was allowed into the property it would be a struggle to remove her should the probate claim be unsuccessful.

There was some doubt as to whether there was jurisdiction under the IPFD to permit interim occupation of property but on the assumption it was allowed under s.5 he declined to permit it.

Practice points

  1. Interim orders under s.5 IPFD are only to be made if there is a need for immediate financial assistance.
  2. To have any hope of consideration under s.5 full financial disclosure will have to be made.
  3. Difficult or reticent applicants should expect to fail and those representing them need to have money on account before the hearing in order to be sure of payment!

20 October 2011

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