Rebecca Cooney: Animal charity legacy ruling calms the waters

By awarding the bulk of the estate left by Melita Jackson to three charities, the Supreme Court has underscored the principle that people can leave their money to whomever they like, writes Third Sector's senior reporter

Rebecca Cooney
Rebecca Cooney

The sector was abuzz yesterday morning with reactions to the Supreme Court ruling in the case of Ilott v the Blue Cross and others (the others in this case being the RSPCA and the RSPB).

The case itself has rumbled on for more than a decade and the ruling was hotly anticipated.

In 2004, Melita Jackson died, leaving the entirety of her £486,000 estate to the RSPCA, the RSPB and the Blue Cross, three charities with which she had no prior relationship and in which she had never expressed an interest, completely excluding her estranged daughter, Heather Ilott. She also left a note explaining her decision and instructions to her executors to fight any legal challenges mounted by her daughter.

Ilott did challenge the will and was awarded £50,000 by a district judge who said Jackson had not made reasonable provision for her daughter. Ilott promptly appealed the ruling in order to ask for more.

She was subsequently awarded £163,000 by the Court of Appeal in 2015, but the charities mounted their own appeal and, in the judgment handed down yesterday, they were vindicated.

Well, sort of. The Supreme Court overturned the 2015 Court of Appeal ruling and reinstated the district judge’s £50,000 award.

But the ruling is unlikely to have left the charities quids-in. Third Sector has been unable to find out how much taking the case to the Supreme Court actually cost the charities – they wouldn’t tell us – but it’s pretty hard to imagine that it would have been less than £113,000, which is the amount of money the charities collectively stood to gain from appealing.

But it’s fair to say that what was really at stake here was the principle, reflected in the concerns charities expressed at the time that the 2015 ruling could open the floodgates for litigants unhappy with their parents’ wills.

So what does yesterday’s result mean for the sector at large and for cases like this in the future?

As soon as the news broke yesterday morning, responses from lawyers flooded in to the Third Sector inbox and there was one common thread: this ruling proves once and for all that people have the right to leave their possessions to whomever they want and to have their wishes respected.

With legacy gifts providing an income stream of more than £2bn a year, this is undoubtedly good news for charities. But some have tempered the optimism with word ofs warning.

Ilott brought the case under the Inheritance (Provision for Family and Dependants) Act 1975, which allows children who have been excluded from wills to argue that their deceased parents should have provided for them.

This kind of action is fairly common, and the legislation, or the way it is applied, hasn’t been changed by the ruling. Rob Oakley, a partner at the law firm Bates Wells Braithwaite, says all cases brought under this law need to be assessed on their own merits, and this case was particularly extreme.

The legislation was largely intended to benefit minors or dependants who can’t look after themselves.

"Here, the adult child was in difficult financial circumstances and the relationship with her mother had been particularly acrimonious, but the decision hasn’t fundamentally changed the law," Oakley says.

So if each case will be judged on its own merits, charities cannot assume that they are likely to win similar cases in the future.

But what yesterday’s ruling does do is clear up some of the problems created by the judge’s comments in the 2015 ruling – which, Oakley says, were pretty unhelpful to charities.

When Ilott was awarded £163,000, the judge said it was because the charities had not provided evidence that they had a greater need for the money than she did and, because they had no relationship with Ilott, they could not have expected to receive it. The gift was, the judge said, a "windfall", and they wouldn’t miss it.

"But the Supreme Court has recognised that charities rely heavily on gifts left to them in wills and that family ties do not automatically take precedence over such gifts," Oakley says.

"It has also clarified that charities don’t have to demonstrate a particular need. If they are selected as beneficiaries by testators, that should be enough."

And it’s this element of the ruling that could have the biggest impact on charities. The Institute of Legacy Management says the anecdotal evidence from solicitors is that there has been a rise in the number of people wanting to bring such cases since the 2015 ruling.

And whereas Oakley says the new ruling is unlikely to turn the tide, Chris Millward, chief executive of the ILM, is more optimistic that it could at least help to "calm the waters".

"It will reduce the number of spurious challenges," says Millward. "We acknowledge there are categories of people who will be entitled to ask or even have a right to some of the inheritance, but there has also been the ‘give-it-a-go-and-see’ brigade, and many charities have been forced into taking action to settle outside court, which has an impact on charitable funds."

For Millward, there’s an overriding sense of relief that the case puts weight on the importance of donors’ final wishes and confirms that, although they are still open to challenge, they can’t be overturned on a whim.

How much of a difference it will make to the sector’s experience of dealing with legacy income overall, he says, "only time will tell".

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