Trusts, Wills & Estates

Skipping a generation – an everyday story of country folk’s Wills

Listeners to The Archers BBC radio serial will have recently heard Peggy Woolley’s heartrending speech to her unconscious son Tony in which Peggy bitterly regrets having left Tony out of her Will. Happily Peggy still has chance to put this right, if Tony recovers, as of course a Will can be changed by a testator at any time provided that its maker has capacity to do so. But was Peggy wrong to leave Tony out of her Will, and was she right to tell her family in advance about the contents of her Will?

Peggy’s Will

Earlier this year, over afternoon tea, Peggy announced the contents of her Will to her assembled family. For those not familiar with the programme, Peggy has three children, Jennifer, Lilian and Tony and one step-daughter, Hazel. Peggy told her children that she felt that her daughters were able to provide for their families but that Tony had not managed to do so as well and she therefore intended to leave her estate between Tony’s children, Helen and Tom.

Fans of The Archers have speculated about Peggy’s motives for drawing up her Will in this way (were the sins of Tony’s alcoholic father, Jack Archer, being imputed to his son?) but from an objective point of view was Peggy doing the right thing?

Generation skipping

Peggy’s Will favours two of her grandchildren over any of her children. If Inheritance tax (IHT) is an issue then this may well be a sensible way of reducing tax. If, for example, Tony was likely to be liable to pay IHT on his own assets then inheriting part of Peggy’s estate would simply increase the IHT payable on his own estate and reduce the amount ultimately passing to Helen and Tom. Leaving the assets to Helen and Tom direct bypasses this problem.

If IHT is not a concern and Peggy was worried about how Tony might deal with any assets left to him, could Peggy have dealt with this in her Will without disinheriting Tony altogether? Peggy could perhaps have considered creating a trust in her Will, either giving Tony the income when he was alive and leaving the capital to Helen and Tom after Tony’s death; or by creating a discretionary trust so that Peggy’s executors would have ongoing discretion over the assets in the estate and who should benefit.

The first option would ensure that the capital of Peggy’s estate would be protected and Tony might not have felt overlooked; the second option would have incorporated a great degree of flexibility into the Will. Peggy could have drawn up a Letter of Wishes stating how she would like any trust powers to be exercised which would have had moral force over her trustees, even though it would not be legally binding.

Could any of the children challenge Peggy’s Will?

Under English law Peggy enjoys complete freedom to make her Will in any way that she thinks fit. If certain specified persons do not receive anything under the Will, or feel that they have not received sufficient, then they can bring a claim against the estate for reasonable financial provision.

Children are one of the specified classes that can bring such a claim. Historically, claims by adult children have tended not to be successful unless an adult child had a particular need, such as a disability, but in recent years the courts appear to be regarding such claims more favourably. Whether or not they would be successful, Jennifer, Lilian and Tony would have the ability to bring a claim, but doing so would both delay the administration of the estate, and increase the costs involved.

Is advance disclosure a good thing?

In our view Peggy was right to tell her children about her plans. However distressed they may or may not feel now, the situation would have been far more emotional if they had discovered the position in the aftermath of Peggy’s death. At least with their mother still alive they have the ability to raise any concerns they might have and to understand her motives for drawing up in her Will in this way.

And what about Tony?

Peggy’s declaration of regret at Tony’s bedside followed his serious injury from an incident with a bull and he is presently incapacitated. Let’s hope Tony has a Lasting Power of Attorney in place so the farm can still be run…but that’s another story.

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