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Welcome to the Summer 2015 edition of our Legacy
Bulletin newsletter
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Welcome to the Summer bulletin from the Stone King Legacy Team.
This edition will look at our upcoming events and pick up on the latest legacy related legal
updates and interesting developments.
We would also appreciate your views on the way that charities could potentially maximise
legacy income. Simon Lofthouse, the newest member of our legacy team and specialist in
cross border matters, has provided us with his profile as well.
Remember to also keep an eye on our website and twitter feeds for updates and news as we
approach our lunchtime seminar. If you haven’t already done so, please join our lively
LinkedIn group.
A number of you will have attended our lunchtime legacy seminar on ‘Giving in the EU just got
easier’ on 26 June 2015. To those of you that attended we hope that you found this interesting
and a great opportunity to meet our team. For those that would like to see it again or missed
out, Dan Harris, Head of the Cross Border Unit, will be recording an online webinar that can
be streamed from our website shortly.
On behalf of the Stone King Legacy Team, best wishes for another successful month. We look
forward to seeing you at our next lunchtime legacy seminar on 16 October 2015.
In the meantime, if you have any questions or if you would like us to address a particular
subject in the future, please contact either myself or a member of our specialist legacy team.
Sarah Eden
Solicitor, Legacy Team
01225 324434
Lunchtime Legacy Seminar: Ilott v Mitson [2015] – the practical
implications for charities with Kate Selway of Radcliffe
Chambers on 16 October 2015
We are pleased to invite you to a presentation on the recent and topical case of Ilott v Mitson
[2015]. This will focus on the practical implications of the case for charities.
Kate Selway, an experienced barrister in contentious probate and private client disputes from
Radcliffe Chambers, will take you through the recent decision, the departure (if any) from the
previous decisions on claims by adult children, the likely impact on charities, how to respond
to the claims being made and advice that could be offered to avoid such claims in the future.
This event will provide an insight into an important and topical case for legacy officers and
their managers. The presentation will be chaired by Paul Sutton, a Partner in Stone King’s
Legacy Team. There will also be an opportunity for questions and discussions, as well as light
refreshments from 12.15pm, with the presentation starting at 1pm on 16 October 2015.
Please click here to view full details. This event is free to attend but we ask that you pre book
your place so that we can ensure sufficient seating and catering.
Case Updates
Ilott v Mitson [2015]: what does the recent decision mean for
charities?
The Court of Appeal has granted an award to Ms Ilott of £143,000 to purchase a home plus
reasonable costs of the acquisition and a lump sum of £20,000 to provide for her income
needs from Mrs Jackson’s estate. The award amounts to approximately one third of the estate
and was based on the following reasons:
The award had been incorrectly limited on the basis of lack of expectancy, ability to live
within her means, and failure to verify the assumption that any award would impact on
her state benefits.
The Court did not need to concern itself with providing Ms Ilott with an income that
would fully support her needs as she has an adult child living independently.
The Charities would not be prejudiced by receiving a lower amount as it would be a
windfall. The Charities did not expect any money from Mrs Jackson as she had no prior
link to them and did not have the same financial needs.
After balancing the claims on the estate, the Court of Appeal found that where a party has
extra financial needs because they were relying on state benefits and those benefits can be
preserved by the provision of housing, this ought to be made as an award from the estate.
Unless there is a further successful appeal to the Supreme Court, it looks like this case will
mean it is harder to disinherit a child and charities would be well advised to be wary of
applicants who have special financial needs, such as those in receipt of state benefits, the
elderly or individuals with disabilities.
Full details of the case can be seen here.
We have also completed an interview with Lexis PSL for those that are interested, please click
here.
King v Chiltern Dog Rescue [2015]: the doctrine of donatio
mortis causa (DMC) should not be relied on as a substitute for
making a valid will
DMC allows a deceased donor to transfer property to a recipient on death without complying
with the formalities required when making a will. It is an anomaly in English law today. There
are three requirements for a DMC: a) a gift must be made in contemplation of impending
death; b) the gift must be contingent on death; and c) there must be delivery of the gift.
In the case of King, the deceased made a will in 1998 leaving the bulk of her estate to seven
animal charities. In 2007, the deceased’s nephew moved in with her shortly after separating
from his wife. The nephew stated in 2010 that the deceased gave him the title deeds to her
unregistered property and told him ‘this will be yours when I go’ and then made three invalid
wills attempting to leave the property to him. The latest attempt was around four months
before her death.
The Court of Appeal has held that the deceased did not make a valid deathbed gift of the
house because she had been unable to satisfy the first two requirements. Although elderly
and conscious of her failing health, there was no reason to expect an imminent death. She
had the time and capacity to approach solicitors and have a new will drafted. The statement
that was allegedly made did not indicate a gift conditional on death, but a statement of
testamentary intent.
It is clear that the three requirements of a DMC must be strictly construed. Successful cases
are likely to be measured in days rather than weeks and anticipation of death but that this
must be from a known cause. Full details of the decision can be seen here.
Charities beware: Data Protection Act 1998 – the right of
claimants to recover damages following the decision in Google
Inc v Vidal-Hall [2015]
By a radical decision in Google Inc v Vidal-Hall and others the Court of Appeal has held that,
amongst other things, claimants may recover damages under section 13 of the Data
Protection Act 1998 (the “Act”) even though there has been no financial loss.
A complainant’s ability to claim damages for breach of the Act without incurring financial loss
will certainly be a concern to any data controller however there is a particular fear of the
impact of the Judgment on charities. Charities have been facing widespread criticism for
processing and passing on personal data of individuals to third parties. For instance the media
has recently reported a story about former army Colonel, Samuel Rae whose personal details
were allegedly sold to unscrupulous companies resulting in him to lose £35,000 and get circa
731 demands for cash.
The law had formerly drawn a distinction between compensation for financial loss and
compensation for distress. Compensation for distress could only be claimed if financial loss
could be shown, even if it was no more than the nominal cost of changing one’s phone
number or email address. Only if that could be shown, would the door open to a claim for non-
financial loss, i.e. compensation for distress (which is considerably more lucrative).
In Vidal, however, the users (complainants) sought damages for distress even though they
had suffered no financial loss. Please click here for full details of the case.
Legacy Survey: maximising legacy income or a step too far?
From 6 April 2012, any estate which leaves at least 10% of its taxable value to a charitable
cause will be able to take advantage of a reduced rate for inheritance tax of 36% rather the
usual 40%.
For those already leaving a legacy to a charitable cause, the rules result in a sweet spot at 4%
of the taxable value of the estate where there is no greater cost to the beneficiary or
beneficiaries of the estate if the legacy to a charitable cause of 4% is raised to 10%.
This presents an opportunity for charities, individually or collectively, to maximise the potential
legacy from the estate but without any financial consequences to the beneficiary or
beneficiaries, existing or future supporters of the charity.
Please click here to access an example letter addressed to the executors of a Will where the
above circumstances apply. However, would charities be willing to use it as a basis for
investigating the possibility of maximising legacy income? Is it a step too far?
We’d be very interested in your views and ask that you answer the three short questions in our
survey here. Please feel free to add comments too. We’ll publish the results in our next
bulletin.
Profile:
Simon Lofthouse
Most memorable moment in law? I
was a trainee solicitor and I had been
asked to take part in a local question
time in my town. I remember getting into
a debate with the local MP against the
introduction of personal independence
payments replacing disability living
allowance. It dawned on me during the
argument that this was one of the
reasons why I chose to become a
solicitor, to speak out for those that are
less fortunate.
What do you do outside of work? My
Background
After 12 (very enjoyable) years in the
Royal Navy, I qualified as a solicitor. I will
be forever grateful to the Royal British
Legion and the Royal Naval Benevolent
Trust for supporting me financially in
making the transition into the legal
profession. I now specialise in cross
border trusts and estates and find myself
talking to clients all around the globe in
the space of a morning. My experience of
travelling and meeting people all over the
world with the Royal Navy has certainly
been of benefit.
Most enjoyable part of your job?
My job is fantastic - it is technically
challenging as it involves looking at the
laws of different countries and then trying
to marry these laws to find the legal
answer. Where the international laws
conflict and there is no legal answer, it is
very satisfying to identify pragmatic
solutions; essentially thinking outside the
box.
Meeting people with very different
experiences and backgrounds is often
fascinating and a real pleasure.
free time is mainly spent with my young
family - our season ticket to Longleat
Safari Park certainly gets a lot of use!
Visits to the rugby and the pub are also
rare treats. I help out in my local
community and have been a trustee and
legal adviser to my daughters’ former
nursery for some time now. I have
fundraised for Macmillan and Age UK
and provided talks for Alzheimer’s
Support and the Defence Recovery
Capability Team. I am always kept very
busy!
Simon Lofthouse
Email: [email protected]
Tel: 01225 326780
Upcoming
Events
16.10.15: Lunchtime Legacy Seminar
on 'Ilott v Mitson [2015]' and the
practical implications for charities
with Kate Selway of Radcliffe
Chambers
January/February 2016 - Young
Charity Group Professionals Drinks
If you have any queries or for further information on Legacy issues, please contact Sarah
Eden by email [email protected] or telephone 01225 324434.
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© Stone King LLP 2015
This publication is for guidance only. The law and practice
referred to has been paraphrased or précised and should not
be construed or relied upon as legal advice.
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