Statutory Will Applications – Notifying Charities

Stuart Parris
Balancing Both Protected Party's Interests

In the event a person lacks testamentary capacity a person responsible for their financial affairs may consider a Statutory Will application being made to the Court of Protection.

What is a Statutory Will?

A Statutory Will is simply a Will made on behalf of a person without capacity which directs how their estate shall be divided on their death. There can be several reasons for making a Statutory Will and when making an application the applicant must consider it to be in the Protected Party’s best interests.

On making a Statutory Will application, any persons affected by the application must be notified. This includes the following:

  • Any beneficiary under an existing Will or Codicil who is likely to be materially or adversely affected by the application;
  • Any beneficiary under a proposed Will or Codicil who is likely to be materially or adversely affected by the application; and
  • Any prospective beneficiary under the Protected Party’s intestacy where the Protected Party has no existing Will.

The above Court of Protection Rules make it clear as to whom is to be notified however there may be circumstances where this may not be appropriate or possible. For example, the notification of a party may not be in the Protected Party’s best interest if this would adversely affect the relationship between the Protected Party and that party during the Protected Party’s life. The recent case of BH v JH considered the notification of others during a Statutory Will application, focusing on an unspecified beneficiary.

Background

This case concerned an application to vary the Statutory Will of the Protected Party made in 2008 following a change in his financial circumstances. The costs of the Protected Party’s care increased significantly which meant on the Protected Party’s death his net estate would be less than expected in 2008. The current Statutory Will left the Protected Party’s estate to his carers, by way of a discretionary trust, with the residuary estate being held on trust for charities for the relief of those suffering from mental impairment. The applicant applied to increase the sum paid into the discretionary trust and for charities for the relief of those suffering from any form of physical disability or disease to be added.

The applicant sought to dispense with the notification to the carers on the basis the notification of the increased inheritance may disrupt the Protected Party’s care, unsettle the carers, and create a conflict of interest. It was held the carers fell into a class required to be notified as the variation materially affected them by increasing the size of the discretionary trust, albeit a moot point if the net estate fell below the value of the discretionary trust as expected.

In considering the notification of unspecified charities, notification was expected to be made to the Attorney General who would represent the interests of charities. It was agreed the variation adversely affected the charities with a larger share of the estate first passing to the discretionary trust, again a potential moot point with the net estate expected to pass entirely to the discretionary trust by the time of the Protected Party’s death. The applicant submitted joining the Attorney General would be a waste of costs which would be incurred against the Protected Party’s estate and was therefore against his best interests with the focus being on the Protected Party’s care costs.

The Court of Protection agreed notification to the carers could be dispensed with on the basis that there were exceptional circumstances in that it may create a conflict of interest. On the other hand, notification to the Attorney General was ordered as the Court felt that the charities’ interests should be represented for the matter of procedural fairness. The Court of Protection commented the lack of specific charities did not create exceptional circumstances nor a compelling reason to dispense with notification and therefore their interests should be represented within the application to address the disadvantages that will bite on the Protected Party’s death.

This case not only confirms the importance of notification during Statutory Will applications, but also confirms where no charity is specified in a charitable bequest, the Attorney General shall be notified to represent the charitable interests.

How can Nelsons help

Stuart Parris is an Associate in our expert Dispute Resolution team, specialising in inheritance and Court of Protection disputes.

If you require any advice on the above subjects, please contact Stuart or another member of the team in Derby, Leicester, or Nottingham on 0800 024 1976 or via our online enquiry form.

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