After a 26-year estrangement, Mrs Jackson left her estate of about £486,000 to charities and nothing to her adult daughter, Mrs Ilott. The Supreme Court held that a district judge had been entitled to find that the will failed to make reasonable financial provision for Mrs Ilott’s maintenance under the Inheritance (Provision for Family and Dependants) Act 1975, and to limit that provision to £50,000. It set aside the Court of Appeal’s larger award, which would have let her buy her rented home and draw a further £20,000.
The estrangement and the will
Mrs Jackson was widowed after four years of marriage, while expecting her only child, later Mrs Ilott. In 1978, aged 17, Mrs Ilott left home secretly to live with a boyfriend of whom her mother did not approve. The estrangement lasted 26 years, until Mrs Jackson’s death in 2004 at 70. Mrs Ilott married without telling her mother. She and her husband had five children and lived throughout with no financial connection to Mrs Jackson, and for most of that time in complete isolation from her.
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Three attempts at reconciliation failed. District Judge Million found that Mrs Jackson had been capricious and unfair in many of her criticisms, and that excluding her daughter altogether was harsh and unreasonable. He also found that Mrs Ilott and her husband had contributed to the difficulties. The decision to leave nothing was nevertheless long settled: Mrs Jackson recorded it in 1984 and repeated it in her last will in 2002, telling her executors to resist any claim. Mrs Ilott knew of it, and the family had managed for years without expecting anything. Apart from a modest legacy connected with her late husband’s employment, the estate went to charities with which Mrs Jackson had had no particular connection in life, but which were her considered choice.
A household living on very little
The Ilotts rented from a housing association and lived within their means, but those means were tight. Four children were at home. Mrs Ilott worked only as her husband’s bookkeeper, for £240 a year; his net earnings as a supporting actor were a little over £4,100. With child benefit, working tax credits, housing benefit and council tax benefit, the district judge assessed net annual income at £20,387, allowing for some limited earning capacity on her part. Savings were about £4,000. Household equipment was old, the car unreliable, and the family could not afford replacements or a holiday.
Housing benefit and council tax benefit, together about £5,100 a year, stopped if savings exceeded £16,000, other than the value of a family home. Working tax credit and child benefit were not affected by capital in the same way. As a sitting tenant, Mrs Ilott could buy the house at a reduced price: £186,000 at the district judge’s hearing, later £143,000.
What an adult child can claim
Lord Hughes, with whom the other members of the Court agreed, started from testamentary freedom. The 1975 Act does not give anyone an automatic share. A limited class, including a child, may ask the court to modify a will, but only if the will does not make reasonable financial provision. Unlike a spouse or civil partner who was still in that relationship at death, a child can claim only what is reasonable for maintenance, not a larger share merely because the will seems unfair.
The test is objective. It is not whether the deceased behaved reasonably. A spiteful will may still make reasonable provision, and a reasonable will may fail to do so if circumstances change. Maintenance means provision for the everyday costs of living at an appropriate standard, not everything it would be desirable to have. It may be a lump sum, and sometimes housing, but the power is to maintain, not to confer capital. For claimants other than current spouses and civil partners, need is necessary but not sufficient. An adult child who can live independently must show something more than the blood relationship. Long estrangement may mean that need alone does not justify an order, and the relationship may also limit how much of that need should be met.
The Act is often treated as asking two questions: has reasonable financial provision been made, and if not what should now be ordered? Lord Hughes said the questions usually overlap. Both are individual value judgments. An appeal court should intervene only for an error of principle or law, not because it would have chosen a different figure.
How the award grew, and why that was wrong
The district judge held that leaving nothing was, viewed objectively, a failure of reasonable provision, but that any award must be limited because Mrs Ilott had lived independently and without expectation of benefit. He awarded £50,000. Mrs Ilott, who sought half or more of the estate, appealed on amount. The charities cross-appealed, arguing that there had been no failure at all.
Eleanor King J accepted the charities’ argument, holding that the district judge had asked whether Mrs Jackson had acted reasonably. The Court of Appeal disagreed: he had gone on to apply the correct objective test, and it sent the appeal on amount back to the High Court. Parker J upheld £50,000.
On a second hearing, the Court of Appeal held that he had made two fundamental errors and substituted its own order: £143,000 to buy the house, plus an option to take up to £20,000 in instalments. Arden LJ treated reliance on means-tested benefits as increasing needs which had to be preserved, and said that the charities, having no competing need, were not prejudiced by a higher award. Both parts of the order were shaped so as to avoid loss of benefits.
Lord Hughes rejected both suggested errors. The Act requires one assessment in all the circumstances, not a hypothetical award followed by an explained discount for estrangement. The district judge had worked through the statutory factors. Estrangement and severe financial limitation were the two dominant features. Some judges might properly have found no remaining obligation to provide anything; he was entitled to find a failure of reasonable provision while letting the distant relationship colour its amount.
He had also addressed benefits. Although given no worked figures, he assumed that a large capital payment would cost the family most, if not all, of their benefits, and he noted that buying the house would free only about £912 a year because housing benefit already met most of the rent. Lord Hughes said that if the judge was separating those benefits from tax credits and child benefit, he was right; if not, he had overestimated the effect, since those payments would continue. Either way, the assumption did not disadvantage Mrs Ilott. The £50,000 was not worthless. She had shown a need to replace necessities of daily living, including white goods, basic coverings and worn-out beds. Spending much of the award on those items was maintenance, and would keep capital from staying long above the £16,000 ceiling. The award was within the generous range of his judgment.
Difficulties in the larger order
That was enough to set the Court of Appeal’s order aside. Lord Hughes also identified problems in it. Housing provided as maintenance is more often a life interest than an outright sum, and that possibility had not been discussed. The option to draw £20,000 was likely to count as available capital under the housing-benefit rules, including where a claimant has deprived herself of capital. The order gave little weight to a quarter-century of estrangement and to the testator’s clear wishes. Those wishes remain part of the circumstances even where a qualified claimant shows a need; they are not cancelled merely because Parliament allows a claim. The charities were the chosen beneficiaries. They did not have to prove need, and any award reduced what the testator intended them to receive. Conduct may matter, but an award should not primarily reward the claimant or penalise the deceased.
Lady Hale’s further observations
Lady Hale, with whom Lord Kerr and Lord Wilson agreed, agreed that the district judge’s order should stand. She wrote separately because, in her view, the Act and the Law Commission work behind it give virtually no guidance on which adult children are deserving of maintenance. She described three respectable answers on these facts: no award, because long independence and the absence of any recognised public duty on parents to support adult children so as to save public money; an order securing the home, as the Court of Appeal made; or the limited sum actually awarded. The first was no longer open, earlier decisions having left the finding of a failure of reasonable provision standing. The choice was a value judgment, and his was one he could properly make. She regretted that the Law Commission had not reconsidered the underlying principles in 2011.
Verdict: The Court unanimously allowed the charities’ appeal and restored the district judge’s £50,000 award to Mrs Ilott. The Court of Appeal had no proper basis for substituting its own assessment of reasonable financial provision.
