It is never too early to start planning for the transfer of assets to the next generation, but it can be too late.
Succession planning, communication and putting in place a properly made will is key to minimising potential challenges and family disputes.
A homemade will may be tempting but not advisable.
In a recent High Court case, there were unsurprisingly 22 questions to be addressed by the judge on what was intended by the clauses in a homemade will.
The judge stressed the importance of getting professional advice when making a will.
Have you factored in the spouse’s legal right share?
A spouse is entitled at a minimum, to their legal right share, one-third of the estate if there are children and half of the estate if there are no children. This takes priority over other gifts in the will.
Is there a second relationship?
The spouse remains the spouse unless there was a divorce and enquiries should be made.
Have I made “proper provision” for each of my children?
Children have no automatic entitlements to a share in a parent’s estate.
The Succession Act, 1965 provides for children to bring a claim to court on the basis that a parent has during their lifetime or by will, failed to discharge the moral duty to make “proper provision” for that child.
The most frequent cases are, when one child has been excluded, or where only one child has benefited to the exclusion others.
These cases often arise where a family business or a farm is the principal asset in the estate.
This can be complex, as the farm or business may only be viable when transferred as a single unit.
Cases have been brought by the children excluded, resulting in settlements which have necessitated the sale of farms, and which could have been avoided if there had been communication around needs, expectations and proper succession planning.
There is also the traditional belief where there is a farm, that a son is the rightful heir and that there is no need to make provision for other children.
Modern succession planning needs to take account of increasing numbers of women in farming.
A parent also needs to consider whether moral obligations to other children have been discharged and, if not, how this can be achieved while at the same time, ensuring parents have a financial plan in place for their own futures.
There is no upper age limit for a child to make a claim. A court recently made provision for a 65-year-old child for whom no provision had been made by a parent who had left her farm to her nephew.
Are there any children with long-term needs or any special circumstances which need to be taken account of?
The concept of “proper provision” is a variable standard and it does not involve giving a fixed or equal share to each child. A parent may treat their children differently, according to their needs and circumstances.
Specialist advice should be taken if there is a child with long-term needs.
What if a promise of land to a child is broken?
Broken promises are often the basis for a claim by a child who may have forgone a good education to work on the farm or in the family business, based on an expectation or a promise that they will inherit the farm.
That promise is then left unfulfilled.
In one case, the deceased’s son had worked on the farm for over 30 years and shaped his life around the farm, did not finish schooling and did so having believed he would inherit the farm.
Unfortunately, it had never been the subject of any real discussion or agreement between the father and son.
Following a lengthy hearing, the court agreed that he should inherit the farm.
Are there other persons in my life outside of ‘the family’ who might have rights to my estate?
While marriage is still the most popular family form in Ireland, the number of people living in unformalised relationships is significant.
As a result of legislative change in 2010, a cohabitant who meets certain conditions can make a claim for provision out of a deceased cohabitant’s estate.
This should be borne in mind and discussed with one’s solicitor.
Can you be over 70 and still make a will?
An older person making a will may be advised by a solicitor to obtain a certificate from a doctor confirming capacity to make the will.
This is not something from which one should take offence, but rather it is good advice, and it should be acted upon, as this may assist with any challenge that the will was not validly made.
How clear should the provisions be in someone’s will?
The provisions should be clear. Beneficiaries should be properly named and if there are two persons of the same name, it should be clearly stated which one is to receive the bequest.
In one case, the deceased gave some of his estate to his nephew “Denis Bennett” but he had no nephew of that name, but he did have a brother named Denis.
He also had a nephew William Bennett, who claimed to be the person to whom the deceased had intended to refer.
If the bequest is of a plot or parcel of land, it should be described clearly, have a map drawn up and the map attached to the will.
Many wills, including bequests of land, refer to a map outlining the plot and no map is attached leading to confusion and disputes.
If a person named as a beneficiary or his/her spouse witnesses the will, that person cannot receive the benefit left to them in that will.
What does my solicitor need to know?
A clear and open discussion should be had in relation to succession planning with one’s solicitors with full disclosure of assets and liabilities.
If there are skeletons in the closet, they should be disclosed to your solicitor.
The value of properly structured succession planning cannot be overstated, and it is a process that should be started early.
Catherine Duggan is a barrister specialising in probate and trust litigation. Catherine is the co-founder and chair of the Probate Bar Association of Ireland and a member and former chair of the Society of Trust and Estate Practitioners.
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