The Inheritance (Provision for Family and Dependents) Act of 1975 makes it possible for those who have lost a loved one, but – for one reason or another – do not inherit anything, or inherit an unreasonable amount from the will or estate, to make a claim against their loved one’s estate. Since its introduction, this act has offered a lifeline for those who were forced to turn to it, but the process can be lengthy and financially burdensome.
This has created a problematic situation for potential claimants – claimants who, in many circumstances, are dependent upon financial provision from the deceased’s estate.
Many contesting a will solicitors like http://www.willans.co.uk/knowledge/contesting-will/ will enter into a conditional fee agreement (CFA) commonly referred to as a ‘no win, no fee agreement’, whereby their clients are only required to pay a success fee. A success fee, on top of the usual legal costs incurred, is usually payable under the terms of a CFA, which is generally not recoverable from the defendant and which the client usually has to pay out of any award they receive from the estate in their claim. A CFA means you only pay all or some of your legal fees if you win the claim, and that you aren’t expected to pay those fees if you lose. So, while this lifts some of the financial burden, it still means that, for claimants who succeed, getting access to the inheritance they deserve incurs a potentially high cost.
That is, until the decision in the case of Hirachand v Hirachand on 15 October 2021 – a landmark moment for anyone making a claim under the Inheritance Act.
The case ofHirachand v Hirachand is an interesting one. The Courts and Legal Services Act of 1990 states that a success fee is not able to be covered by a costs order. For the past thirty years, this has been the predominant reason why affording legal fees remains a big concern for many claimants. Contesting a will can be a lengthy process, which means that success fees can represent a significant chunk of what they are able to inherit if successful.
This was the case for Sheila Hirachand, who was awarded financial provision from her late father’s estate, including £16,750 earmarked for her solicitor’s success fee.
There is an important distinction to be made, however. The judge states that this was not a costs order, but a reflection of the claimant’s financial needs in light of the impact of the CFA and the success fee that was payable. In other words, her financial obligation to her solicitor was considered as part and parcel of her financial situation, and right to financial provision from the deceased’s estate.
This offers new hope for future claimants to contest a will and claim the financial provisions they need and deserve. Success fees may now be included as part of the award, rather than detracting from it. However, it is important to keep in mind that this is at the discretion of the court, and not a guaranteed outcome for anyone.