Advising Alice!

Trainee Solicitor, Emily Hearn, ponders the legal advice that could have saved Alice so much heartache!

(Contains spoilers!)

“Dying was what other people did. No one is prepared for anything. Truly we are too busy making other plans.”

These poignant words were shared in grief by Alice on the sudden loss of Harry, her partner of nearly 20 years. Alice is of course the main character from the recent ITV drama ‘Finding Alice’ staring Keeley Hawes. Have you been watching? Did you ever consider how complicated a sudden death could be to you and your circumstances? Not having a will in place can lead to drastic consequence as Alice is now discovering…

Alice’s world is unravelling at a catastrophic speed as the man she considered to be her husband predeceases her, leaving her and their 16-year old daughter ‘in the house he had built’.

Harry dealt with the finances for the family. Harry’s accounts are frozen, access to his account is blocked and Alice cannot remember her own banking passwords leaving her with no money to support herself and daughter.

We know that Alice and Harry are unmarried and Harry left no will. This consequence of no will means that Alice will not inherit under the Law of Intestacy, (the rules which apply where the deceased leaves no will), but instead their daughter, Charlotte, will.

Alice and Charlotte may not have Harry anymore but they at least have the house that Harry ‘built’. A £1.5 million smart house that Harry constructed himself as a builder and property developer. Except they do not; Harry had transferred by way of gift, the legal ownership to his parents prior to his death. As Harry continued to live in the house the gift to his parents is classed as a “gift with reservation of benefit” and so the house continues to form part of Harry’s estate for Inheritance Tax (“IHT”) purposes leaving his Estate responsible for the IHT bill, a staggering amount at approximately £500,000. In the drama, Harry’s parents believe themselves to be responsible for the IHT bill and they do not have the money to pay this tax. Therefore the house will need to be sold despite Alice’s protests.

Harry had a troubled business which led to dealings with a business associate. The extent of the assets and details are not known at the early stage of the programme. What influence or stake does this business associate have over the company?

The complexities keep coming. Harry left behind a secret son, George, conceived before Harry and Alice had become a couple. George is legally entitled to inherit alongside his half sibling Charlotte, as a child of Harry. Whilst dealing with all of these curveballs, the family is also struggling to agree what Harry’s funeral wishes were.

What could Harry have done to make Alice’s life easier as a bereaved partner?

Harry was in his forties but planning for death was not on the top of his list. A family man who wanted to care for all of his loved ones was absorbed in the difficulties he was facing at work. As a result his assets will be shared out according to the law instead of his intended wishes. This means his assets could pass to someone he had not intended to – or that someone he wanted to pass things on ends up with nothing.

If Harry had left a will he could have relieved some of the burden on Alice by setting out his intentions:-

who he wanted to deal with the administration of his estate
who he wanted to inherit and what they would inherit (avoiding the unintended consequences of intestacy)
his funeral wishes (though not legally binding, it is the first place to look upon death)
he may have been able to make a provision for payment of IHT
he would have received advice about “gift with reservation of benefit”
how his business assets were to be dealt with
details of his digital assets, for example the details for the smart home.

What would we advise Alice?

Write a will! Alice is a surviving parent with a minor child, (under the age of 18). The complications that she is facing now will be applicable upon her death should there also be no will. In addition this would give Alice the option to appoint a legal guardian for Charlotte, if Alice dies before Charlotte is 18.

Alice had been with Harry for nearly 20 years and considers him to be her husband. Unmarried partners are entitled to make an inheritance claim to the Court against their late partner’s estate, if their will or in this case, the intestacy rules fail to make adequate financial provision for them. Claims by cohabitees can be made under the Inheritance (Provision for Family and Dependants) Act 1975 where the claimant had been cohabiting for at least 2 years prior to their partner’s death, as husband and wife, in the same household. Alice relied on Harry for full financial support as a stay at home partner and mother. Alice would need to begin her claim within six months from the date of the Grant of Representation (the document received from the Court to administer the estate) to Harry’s estate.

This may be a TV drama but the issues that are occurring to Alice happen to more people more often than you think. Dealing with the death of a loved one is destabilising, catastrophic, shocking and all-encompassing. Perhaps now is the time for you to think about planning for your loved ones in the event of your death by writing a will and by taking tax advice. The day will come, it is inevitable after all.

Contact us to help you put your will in place today.