In the absence of sound legal advice, those planning how to pass on their wealth on their death may fall prey to popular myths about the rules of inheritance. This increases the likelihood of future probate disputes. We debunk some of the common myths that often give rise to avoidable family conflict and estate claims:
Myth #1: Under the laws of England and Wales, you are free to distribute your estate as you wish.
In theory, this is true: the freedom to leave your estate to whomever you choose is a central principle in English and Welsh law. However, in practice, if the person making the Will (known as the testator) fails to make reasonable financial provision for certain people, they may leave their estate particularly vulnerable to challenge from claims.
This risk is especially acute when it comes to failure to provide for spouses or civil partners. Spouses and civil partners are entitled to a higher standard of provision than other claimants. They can expect to receive what is reasonable, whether or not that amount is required for their maintenance. Testators should take expert legal advice and consider carefully which dependants they should provide for in their Will to avoid the risk of future claims.
Myth #2: Divorces revoke any Will made during a marriage.
Marriage automatically revokes any Will made previously. The same is not true of divorce, contrary to popular belief. The effect of divorce is that the Will remains valid but any gifts in the Will to the former spouse fail. If the testator neglects to update their Will after divorce, their estate may not pass to the desired beneficiaries.
For example, during their marriage, a testator may make a Will leaving their estate to their spouse, or if their spouse predeceases them, to members of their spouse's family. If the testator dies after divorce, but before they have changed that Will, their estate will pass to their former spouse's family members. This may not reflect the deceased's wishes. It could also come as a surprise to the deceased's dependants, who may have expected to benefit under the intestacy rules (i.e., the laws relating to who inherits in the absence of a Will). As a result, the dependants could be left facing the prospect of a lengthy court battle to try to rectify the situation.
Myth #3: If you die intestate (without a valid Will), your cohabiting partner will inherit your home.
Even if the surviving cohabiting partner shared the legal title to the property, whether the property automatically passes to them following their partner's death depends on how it was held.
If the couple owned the property as "joint tenants", the property will pass to the surviving partner. If it was owned as "tenants in common", whereby each have a specific percentage share in the property, the deceased's share will form part of their estate and will pass according to the terms of their Will. However, if the deceased partner did not have a valid Will providing that their share in the property will pass to the surviving partner, that share would be inherited by a member of the deceased's family under the intestacy rules.
If only one of a cohabiting couple owns their home, the position is even more difficult. The intestacy rules do not recognise a cohabitee as a beneficiary entitled to any inheritance. Instead, under the intestacy rules, the deceased's entire estate will pass either to his or her children, or if there are none, to another member of their family. The surviving partner might then have to bring a claim to seek an interest in their home.
Either of the scenarios above could be avoided if both members of a cohabiting couple ensure that they leave their estates, and certainly their property, to the other in a Will.
Conclusion
An awareness of these common myths is a useful reminder that clients should obtain expert estate planning advice, to ensure their wishes are put into effect on their death. Failure to do so is likely to lead to unintended beneficiaries, family disputes and potentially costly litigation. Careful estate and succession planning, together with regular, open communication between family members, will help to avoid these risks.
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