Successful Inheritance Act claim for perceived “lodger”

Testamentary freedom, or a person’s freedom to dispose of their property upon death as they see fit, is a fundamental principle of English and Welsh law.

Justice Cockburn very eloquently defined this in Banks v Goodfellow by stating “The English law leaves everything to the unfettered discretion of the testator, on the assumption that….the instincts, affections, and common sentiments of mankind may be safely trusted to secure… a better disposition of the property of the dead, and one more accurately adjusted to the requirements of each particular case, than could be obtained through a distribution prescribed by the stereotyped and inflexible rules of the general law”.

However, what happens if someone believes that they have not been adequately provided for financially, following the death of the deceased? In this situation, the Inheritance (Provision for Family and Dependants) Act 1975 (“the Act”) steps in as a safety blanket for certain individuals who can bring a claim if they feel they have not received reasonable provision from the deceased.

The facts of the case

Such a claim was successfully brought by Andrew Banfield, the unmarried partner of almost 20 years of Sarah Campbell. When Mrs Campbell died unexpectedly in 2015, her son James Campbell was named as the main beneficiary of the will. However, Mr Banfield, who is disabled, challenged the will as being unreasonable. Mr Banfield claimed that he had become engaged to Mrs Campbell in 1999 and that they had lived together as “husband and wife”. This was disputed by James Campbell, who denied that the engagement had ever taken place and maintained that the relationship had deteriorated due to Mr Banfield’s sedentary lifestyle, to the point where Mrs Campbell considered Mr Banfield to be no more than a lodger. Judge Paul Teverson disagreed, saying “I do not think it right or fair to characterise Mr Banfield as being no more than a lodger”. The Judge ruled that Mr Banfield had lived as Mrs Campbell’s “husband” and said – whilst conceding that Mr Banfield’s disability had made the relationship more burdensome for Mrs Campbell – that the relationship continued to contain an element of mutual support, with Mrs Campbell making it clear to friends she did not want to be on her own.

The Judge ordered that Mrs Campbell’s house be sold for at least £725,000 and half the proceeds invested in a property for Mr Banfield, which would ultimately revert back to Mr Campbell. Mr Campbell was also ordered to pay £50,000 towards Mr Banfield’s costs.

How was he able to bring a successful claim?

The Act enables certain people, including a spouse or civil partner; a former spouse who has not remarried; child; or financial dependant of the deceased to apply to the court if they do not believe they have received reasonable financial provision from the deceased’s estate under the will (or indeed, under the statutory rules on intestacy which apply where no will exists). In considering a claim under the Act a court will take into consideration factors including:

• The financial resources and needs of the claimant
• Any obligations and responsibilities of the deceased towards the claimant
• The size and nature of the estate
• Any physical or mental disabilities of the claimant
• Any other matter including conduct, the court considers necessary

A court has very wide powers of discretion when considering a claim, such as the one brought by Mr Banfield and will ultimately look at whether the will made provision for his maintenance as would be reasonable in all the circumstances. This is an objective test and each case is decided on its own facts. Mr Banfield was able to prove to the court that Mrs Campbell partially maintained him during his lifetime and as a dependant, he had not been reasonably provided for under the will.

What can we take away from this ruling?

This ruling is by no means a shot to the heart for the principle of testamentary freedom, but it does remind us that, in cases where there is perceived unfairness and reasonable financial provision has not been left in a will, a court has wide powers to re-distribute an estate.