High Court Bends Over Backwards to Resolve Family Will Dispute

Newspaper columns are replete with accounts of the crushing costs of litigation and it is easy to lose sight of the fact that it is the role of judges to resolve disputes as efficiently and cheaply as possible. The High Court has done just that in bending over backwards to achieve a settlement of a bitter family will dispute.

Two sons had launched proceedings, challenging their father’s will by which he left everything he owned, including his £675,000 share of the family farm, to a childhood friend. The dispute had generated a great deal of acrimony and the positions of the parties were in danger of becoming entrenched.

An attempt at mediation had largely stalled and it was to the credit of lawyers on both sides that they had encouraged the parties to settle their differences. To that end, the Court took the rare step of directing that a judge should carry out a ‘neutral evaluation’ of the strength of the arguments on each side.

That swift and relatively low cost procedure, whilst not leading to a formal judgment, would result in non-binding recommendations as to the likely outcome of the case which would be likely to assist in achieving a settlement. The Court noted that the use of such a fast-track procedure was possible under the Court’s inherent jurisdiction to control proceedings and was to be ‘warmly welcomed’.

Art Collector’s Son Scores Inheritance Tax Victory

Gifts to your loved ones are a sensible means of minimising Inheritance Tax (IHT) liabilities on your death – but it is vital to seek legal advice and leave a clear paper trail behind you if substantial tax savings are to be achieved.

HM Revenue and Customs had raised IHT demands against the son and heir of an art collector in respect of three valuable paintings. As executor of his mother’s estate, he disputed liability on the basis that she had given the paintings to himself and his brother more than 20 years before her death.

In allowing his appeal and accepting that the paintings were free from IHT, the First-tier Tribunal found that his account of the gifts was entirely credible. With some ceremony, the paintings had been taken off the wall of the family home and handed individually to him, before being re-hung where he wanted them. Although the paintings had stayed in the family home, that was only because he and his brother had had nowhere secure enough to keep them.

Unmarried Couples – Are You as Secure as You Think?

In a case which stands as a warning to unmarried couples that their assumptions of security are often wrong, a dog breeder who said that she was left with nothing but an Airedale terrier after she split from her partner of more than 30 years has failed to win a stake in his £750,000 kennels business.

The woman, in her 50s, argued that she had ‘thrown in her lot’ with her partner, whom she had met as a teenager. She had worked hard in the business for only £50 a week and it had always been her understanding that she was a partner in the venture and part-owner of the home where the couple lived and worked.

She lodged proceedings after the relationship broke down and her partner excluded her from the property. However, a judge rejected her claim, noting that the property, as well as a previous home they had shared, had been paid for entirely by her partner and that he had made it expressly clear to her that she would have no interest in it and that her name would not be on the title deeds.

Also rejecting her claim that she was a partner in the business, the judge noted that she was paid a small allowance and was treated as a minor employee. She was also identified as an employee on her tax returns and had not acted to her detriment in reliance on any assurance her ex-partner gave her. In dismissing her challenge to the judge’s decision, the Court of Appeal described it as unimpeachable.

Sotheby’s Cleared of Negligence in ‘Caravaggio Painting’ Row

A man who accused auction house Sotheby’s of negligently selling a painting which could have been by Italian baroque master Caravaggio for just £42,000 has had his hopes of multi-million-pound compensation dashed by the High Court.

The painting of three card players closely resembled a celebrated work displayed in an American museum – known as ‘The Cardsharps’ – which is widely accepted to be by Caravaggio. However, Sotheby’s took the view that the man’s painting was a copy and knocked it down to an experienced collector of baroque paintings.

After cleaning and restoration work, the collector claimed that the painting was by the hand of Caravaggio himself, an announcement which potentially boosted its value well into the millions. Whilst not seeking to prove that the work was an original, the man sued Sotheby’s, claiming that he had been negligently advised as to its possible value and that the painting had been misattributed in the sale catalogue.

In dismissing his claim, however, the Court found that, in assessing the quality of the painting, Sotheby’s was entitled to rely upon the connoisseurship and expertise of its experienced specialists who were ‘certain’ that the painting was a period copy and not by Caravaggio. Even had the auction house commissioned infra-red analysis of the painting, nothing would have been discovered which would have cast doubt on the assessment of is experts.

Christmas comes early to Armstrong’s as Alison is named as Rising Star

We are pleased to announce that our principal, Alison Armstrong, has been included as one of six "Rising Stars" in her field in the 2014 Super Lawyer's list.

Super Lawyers, which is part of Thomson Reuters, is a solicitor-rating service with a mission of bringing visibility to solicitors who exhibit excellence in the practice of law.  The selection process is designed to find indicators of peer recognition and professional achievement and solicitor's cannot nominate themselves or pay to be rated.

Double ISA Allowance for Surviving Spouses

From 3 December 2014, a surviving spouse or legal partner will 'inherit' the ISA allowance of their deceased spouse or partner.

The move, announced in the Chancellor of the Exchequer's Pre-Budget statement, means that the survivor will effectively have a double ISA allowance after the death of their spouse or partner.

The transfer will not be automatic, however. The deceased person's ISA will have to be dealt with in the same way as any other assets of their estate and the survivor will then have a one-off allowance.

However, the allowance is not available until 6 April 2015.  The ISA limit also increases to £15,240 from 6 April 2015.

Ex-Husband Denied Share of Former Mother-in-Law’s Estate

In a case in which the bitter fall-out from divorce affected not only the ex-couple but their entire family, a disgruntled ex-husband has suffered defeat in a High Court bid for a share of his deceased former mother-in-law's £250,000 estate.

The man had argued that, under the terms of his divorce, he was entitled to about £75,000 of his ex-mother-in-law’s money.  That was on the basis that, when he divorced her daughter, the latter had agreed that he should have an equal share of any inheritance which she received from her mother which exceeded £100,000.

When the woman died, she left £100,000 to her daughter and most of the rest of her wealth to her grandchildren. On the face of it, the terms of the will had the effect of defeating any claim against the estate by the ex-husband. However, he pointed to anomalies in the document and argued that it had not been properly executed.

Following a preliminary hearing, a judge nevertheless ruled that the man, who was not a beneficiary under the will, had no ‘legal standing’ to mount an attack on its validity.  On the available evidence he, in any event, had ‘little chance’ of proving that it had not been executed in accordance with the law.

Scientist’s Orphanage Wish Leads to Will Dispute

An eminent scientist and inventor’s wish to endow a foundation to benefit orphans may be frustrated after his widow signed potentially conflicting wills, giving rise to venomous family wrangling and costly litigation on either side of the channel.

The widow, who had substantial assets in a number of countries, had made one will in England, benefiting her niece, and another in the Netherlands which named an orphans’ foundation as her sole heir. The foundation was named after her deceased husband and the Dutch will, which narrowly post-dated the English document, strictly stipulated that her relatives should derive no benefit from her estate.

The two wills had given rise to a wide-ranging dispute between the widow’s two brothers, her niece, various other members of the family and the foundation. Issues had arisen as to whether either will had been properly executed and as to whether the widow was of sound mind when she signed them. There was also a debate as to whether the Dutch will had revoked the English document.

The brothers had launched proceedings in England and asked the High Court to block parallel proceedings brought by the niece and the foundation in the Netherlands. It was submitted that the Dutch proceedings were vexatious and oppressive and that England was the natural forum in which all the issues should be resolved.

The Court observed that it was ‘most unfortunate’ that there should be concurrent proceedings in two different jurisdictions, giving rise to a risk of conflicting judicial decisions. However, in refusing to grant an anti-suit injunction to stop the Dutch proceedings, the Court found that they could not be viewed as unconscionable, unjust or abusive.

Animal Charities Lose Out in Bitter Will Dispute

A retired policewoman and animal lover may have been a bit confused in her final years, but she knew what she was doing when she gave her £350,000 home to the nephew who cared for her, the High Court has ruled.

The nephew insisted that he had looked after his aunt devotedly as her health failed and that it was her gratitude which prompted her to hand him the deeds to her home and to utter the words, "This will be yours when I go."

Seven animal charities were set to inherit all but £19,000 of the aunt’s estate under a will she had signed in 1998 – but the nephew successfully argued that the house was his because his aunt had gifted it to him when she knew she was dying.

The nephew had 'a somewhat chequered history'. He had twice been made bankrupt in the past and had served a 12-month prison sentence for acting as a company director while disqualified from doing so. The Court noted that it was ‘not surprising’ that the charities’ lawyers had mounted a full-scale attack on his credibility.

The charities argued that nephew's account of the gift was 'too convenient by half'. No one else had witnessed the deeds being handed over and he had overemphasised his caring role. The aunt had devoted her retirement to helping animals and it was 'common knowledge' that she intended to leave her home – by far her biggest asset – to animal charities on her death.

The Court approached the nephew’s evidence ‘with a very considerable degree of circumspection'. However, there was evidence that the aunt had several times tried to change her will in his favour before she died. The nephew’s account was 'entirely unshaken' under cross-examination and was accepted as accurate.

The charities also argued that, if the aunt had made the gift, she was not of sound mind when she did so. She was said to have suffered from a delusion that one of her cats had gone missing, when it had died years earlier. However, the Court was not persuaded that the aunt lacked the necessary mental capacity to benefit her nephew. She was 'contemplating her impending death' when she put the deeds into his hands and the gift of her home was valid.

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