The Extra Division of the Inner House of the Court of Session recently held that surviving cohabitants do not have a right to make a claim on the heritable estate (i.e. land and buildings) of their deceased partner when it is located abroad.
The right of a cohabitant to make a claim on a deceased partner's estate was introduced by section 29 of the Family Law ( Scotland) Act 2006 ("the 2006 Act"), and applies only if the person died intestate, i.e. when a will is in place, such a claim cannot arise.
In addition, the deceased must have been domiciled in Scotland immediately before death and the cohabitant must make a claim within six months of the death (that time limit is under review and the Scottish Government is consulting on whether it should be increased to one year).
In the case of Kerr v Mangan [2014] CSIH 69, Ms Kerr decided to make such a claim after her partner, Mr Mangan, died in 2007. Mr Mangan died without leaving a will, was domiciled in Scotland and had lived with Ms Kerr for 22 years.
In the first instance, the Sheriff awarded Ms Kerr the sum of £5,502 from Mr Mangan's estate. However, on appeal, the Sheriff Principal reduced the award to nil. Ms Kerr then appealed to the Court of Session, which refused the appeal and upheld the decision of the Sheriff Principal.
The Court of Session's decision turned on the meaning of part of section 29 of the 2006 Act which provides that any award made to the cohabitant must be "out of the deceased's net intestate estate".
As the Court rules that section 29 of the 2006 Act was part of the law of succession and should be interpreted accordingly, it followed that heritable property must pass according to the lex situs (the law of the place where the property is located), and not the law of the deceased's domicile. The property in Northern Ireland could not therefore be taken into consideration when calculating the value of Ms Kerr's claim under Scots law as Mr Mangan was domiciled in Scotland and not Northern Ireland.
This decision illustrates the importance of having an up to date will, not only for those with property which is located outwith Scotland, but for everyone. The lack of a will can have a number of undesired effects: your cohabitant could be left with nothing, even if you wished to provide for them, or alternatively they could be entitled to make a claim under section 29, even if it was your intention that they were not to receive anything from your estate. Even for those who are not cohabiting, there are myriad reasons why an up to date will is essential, from asset protection and tax planning, to reducing the costs of administering your estate on death.
The decision also highlights the complexity of succession law and the need to take legal advice at the earliest possible opportunity if you intend to make a claim for provision from a cohabitant's estate, particularly as the claim must be made within six months of death.
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