Ilott v. Mitson (again) by Robert Sheridan
Much excitement appears to have been generated by the Court of Appeal’s judgment in Ilott v. Mitson.
Such excitement is largely misplaced, but there are some matters in the judgment of Arden LJ that are worth mentioning.
The Court of Appeal set aside the Order of Parker J, which upheld the district judge’s decision to award the appellant £50,000 from the estate of her mother. The bases on which this Order was set aside seem flimsy (paras 35 and 36), but it is not the purpose of this Note to comment upon that part of the judgment.
The Court of Appeal was evidently eager to sit as a trial court because, rather than sending the matter back to the High Court or the Principal Registry, it decided to judge the case itself. It having already been determined that the appellant was entitled to something, the only question that remained was: ‘how much?’
The principal factor to take into account was the appellant’s needs and resources. None of the other factors exercised Arden LJ for very long, although she did make some interesting points about section 3(1)(g) of the Act (which relates to ‘any other matter’ that the court may take into account.) In particular, she concluded:
Applicants should not be penalised for living within their means, and ‘existing means are not conclusive as to the appropriate level at which a claimant is entitled to be maintained.’ This must be correct: maintenance is an objective standard and, as such, it cannot necessarily follow from an applicant’s living within his means that he does not require maintenance. Whether he does or does not live within his means is not the question: rather, the court must determine whether his standard of living falls below the maintenance level.
The testatrix’s testamentary wishes count for nothing. Arden LJ’s judgment at paragraph 51(iv) is not altogether easy to follow; but what she appears to be saying is this: that because testamentary wishes can only be overruled to the extent that they come into conflict with the need to make reasonable financial provision for applicants’ maintenance, it is acceptable to take no account of those wishes. It seems preferable to conclude that it is acceptable to take no account of those wishes because the Act tells us to take no account of them, but the result would be the same.
Estrangement can be relevant. Arden LJ thought that it was not relevant in this case because ‘there is no suggestion that she wanted to be estranged from Mrs Jackson.’ Presumably, therefore, if the appellant had denounced her mother to all and sundry, and then stormed off, never to speak to her again, estrangement might be relevant. It seems, therefore, that an estranged applicant is more likely to prevail if he can satisfy the court that he is not to blame for the estrangement.
As far as resources and needs are concerned, Arden LJ stated, ‘I consider that the appellant’s resources, even with state benefits, are at such a basic level that they outweigh the importance that would normally be attached to the fact that the appellant is an adult child who had been living independently for so many years.’ This is not easy to follow: all it means, surely, is that an adult child on state benefits is able to establish (and usually will establish) that an award from an estate needs to be made for his maintenance. State benefits are not the same as maintenance; the latter standard of living is generally higher than the former.
The most interesting point about the award of £143,000 for a property plus expenses and a further £20,000 is this: that although such an award would bring to an end the applicant’s housing benefit, she would still be able to keep her tax credits. She would have her own property (for which she would not have to pay any rent or mortgage) but she would still obtain benefits from the state- because tax credits take no account of the applicant’s capital. The Court of Appeal made clear that this award would not wipe out all the applicant’s state benefits.
In the end, the court reached a judgment that for the applicant’s maintenance, she required a mortgage-free property. Given the modesty of the sum allowed for such a property, it is difficult to argue that this award went beyond satisfying the applicant’s maintenance.
It should be clear that this case concerns only those adult children on state benefits: if a testator has children (and other potential non-spousal applicants) who are all in gainful employment, he remains free to distribute his estate as he chooses. His estate is only at risk when there are applicants whose standard of living falls below the maintenance standard.