The recent case of Kloosman v Aylen highlights the confusion that can arise when lifetime gifts are given to the same people who are due to benefit under a will. Richard Frost made a will that divided his estate into thirds one third for his daughter Linda, one third for his daughter Susan and the remaining third for his son and grandchildren. Soon after making the will, Mr Frost sold his house for £350,000 and moved in with his daughter Linda. A few weeks later, knowing he was dying of cancer, he made cash gifts of £100, 000 each to Linda and Susan.
When Mr Frost died in March 2008, his estate included the remaining £137,000 from the sale of his house. Confusion arose over whether Mr Frost had intended the gifts to be advance payments to Linda and Susan for their shares set out in the will. Or did he want them to inherit a third of the remaining £137,000 in addition to the £100,000 they had already received?
The law says that when a parent leaves a substantial share of his/her estate in his/her will to children and then gives a large life-time gift to one of those children, the gift will usually be treated as part of the childs inheritance. However in this case, Deputy Judge Vivien Rose decided that Mr Frost had not intended to payhis daughters for looking after him. The judge therefore ordered that Linda and Susan should each receive a third of the remaining £137,000.
Natalie Palmer, a Solicitor and Partner at Latimer Hinks and a specialist in Wills Probate and Trusts, said: "parents wanting to benefit children before they die need to consider the consequences, and be clear and open about their intentions if they want to avoid family fights and court battles.
"No one will ever know for certain what Mr Frost intended. He may have assumed that it was obvious that the gifts to his daughters should be brought into account in distributing his estate equally, but it is just as likely that he never gave the issue a moments thought.
Natalie, who along with other members of the private client team is a member of the Society of Trust and Estate Practitioners (STEP) and Solicitors for the Elderly, added: "What is certain is that he left a legacy of ill will and division amongst his family by not stating his intentions. If he had taken advice and made a properly informed decision, his family might have found it easier to accept the outcome.