The High Court heard a case regarding the distribution of an estate where one of the beneficiaries disclaimed their inheritance. The will included the term 'failure' but as the defendant had not pre-deceased the deceased, the gift had not failed in the usual sense of the word.
Background:
Mr. Williams passed away on the 11th of June 2023, leaving a will dated the 31st of March 2014. Mr. White is the sole executor of the will to whom probate of the will was granted on the 6th of October 2023. The net value of the estate is estimated at £393,974.
His will left his residuary estate to six beneficiaries in equal shares, one of which was to his son 'Keith'. As they were estranged, Keith refused the gift under the will which resulted in the question about the distribution of his share, as Keith has no children.
Keith had made it clear on several occasions that he wanted nothing to do with the deceased's estate and did not sign the Notice of Disclaimer. Procedures were commenced on the 22nd of January 2024. The will contained a clause to the effect that, should any share 'fail', it would pass to the remaining beneficiaries. The central question of this case relates to the meaning of 'fail' under the will.
Decision:
The High Court first restated that Section 33A of the Wills Act 1837, introduced by Section 2 of the Estates of Deceased Persons (Forfeiture Rule and Law of Succession) Act 2011 provides that, where a person disclaims a gift in a will, "unless a contrary intention appears by the will", that person is to be treated for the purposes of the Act as having died immediately before the testator. The will however contained no such contrary intention.
The Court was concerned with two express substitutionary clauses in the will, namely clauses 6(a)(v) and 6(b). As a result, the Court looked at the two permutations, namely whether Keith was to be treated as having pre-deceased his father or otherwise. "If Keith is not to be treated as having pre-deceased the deceased, then his disclaimer would result in a partial intestacy in respect of his share unless the Will otherwise provides (...) If, on the other hand, Keith is to be treated as having pre-deceased the deceased, then since he had no children, then the substitutionary gift to his children also would fail, in my judgement, within the meaning of clause 6(b)."
The Court ruled that Keith's one-sixth share of the deceased's residuary estate was to be divided among the other beneficiaries of the residuary estate as per clause 6(a) of the will. The Judge determined that the natural and ordinary meaning of 'failure' in clause 6(b) of the will extends to a disclaimer, even if it occurs after the passing of the deceased.
Implications:
This case underscores the importance of employing precise language in wills. It also highlights that, in the absence of a specific clause, the disclaimed share of the estate will pass under the intestacy rules. Following this judgement, it is clear that the courts will apply the natural and ordinary meaning of the word 'fail' to disclaimers, even if the disclaimer is invoked after death.
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