It was recently held by the Court of Appeal in the case of Lynn Lewis v Thomas Warner [2017] EWCA 2182 (Civ) that “reasonable financial provision” for maintenance, as defined under the Inheritance (Provision for Family and Dependants) Act 1975 (‘the Act’), could be fulfilled by an order to transfer the deceased’s (Mrs Blackwell) property to her surviving unmarried co-habiting partner (Mr Warner) for a sum greater than the value of the property.
Background
Mr Warner, aged 93 at the time of the appeal, had been living with his unmarried partner, Mrs Blackwell, in her home for nearly 20 years before she passed away in 2014. The deceased had made a Will but as it could not be located, her Estate passed to her daughter (Mrs Lewis).
Mrs Lewis wanted to sell the property on the open market with vacant possession in order to attain the highest potential value. Mr Warner stated throughout proceedings that he would be 'very unhappy and stressed' if he had to move from the house where he had spent the 'happiest 20 years of his life'.
It was held in the initial proceedings that the property was to be transferred into Mr Warner’s name and he was to pay the purchase price of £385,000.00. The parties had a joint expert who valued the property at £340,000.00, but Mrs Lewis obtained a second valuation at a higher figure. Mrs Lewis was not satisfied as she wished for the property to be sold on the open market. Mrs Lewis appealed the ruling which was dismissed in the High Court and proceeded to the Court of Appeal.
The Court of Appeal – “reasonable financial provision”
The Court of Appeal held on 19th December 2017 that the initial decision to hand the property to Mr Warner, given his age and poor health, was a 'sensible pragmatic solution'.
It was held that failure to provide for Mr Warner to remain in the property amounted to a failure to give reasonable financial provision for maintenance. The word ‘maintenance’ imports a concept of ‘need’. The Court of Appeal considered the factors listed at s3 of the Act, and in particular the obligations of the deceased toward Mr Warner (s3(1)(d)); Mr. Warner’s physical disabilities (s3(1)(f)); and Mr. Warner’s age and the period of cohabitation (s3(2A)(a)).
Referring to s2(1)(c) and s2(1)(e) of the Act, the Court of Appeal concluded that the first instance Judge had been entitled to order the transfer of the property for a greater value than provided by an expert. It was concluded that there may be exceptional cases, such as this one, in which a person’s needs are for a particular property and the financial value of said property is not the most important factor. This decision provides a widened definition of the term “financial” as referred to in the Act. It was held to include the entitlement to purchase a property which in turn benefited the Estate with a higher transfer value. This decision was reached despite Mr Warner being financially secure enough to purchase another property.
At Ramsdens, we offer a specialist and affordable will writing service. To speak to someone about updating your Will or making a Will for the first time call us on 01484 821 500, text LAW to 67777 or email willsandprobate@ramsdens.co.uk .