26 April 2019
In this case, the claimant applied for permission to make a late application for reasonable financial provision against the estate of her late husband.
The claimant's husband had died in April 2016, leaving an estate worth around £16 million. He and the claimant had married shortly before his death, although they had been living together since 1994. The claimant is now 77 and the terms of her deceased husband's will were expressly set out to meet her every reasonable need for the rest of her life. Her husband had made her the main beneficiary of two trusts, with a life interest in one of them.
The six-month time limit for the bringing of an application for reasonable financial provision expired on 16 June 2017. The claimant's application for permission to make a late application was not made until 8 November 2018 (nearly 17 months out of time). The claimant contended that the application was in fact only 13 months delayed due to a stand-still agreement which had been entered between the parties so that negotiations could take place.
The judge (Mr Justice Mostyn) dismissed the claimant's application. He stated that the time limit of six months existed to avoid unnecessary delay in the administration of estates caused by late applications and to avoid the difficulties which arise where distributions have been made from an estate prior to such applications being made. The time limit exists to protect beneficiaries from being vexed by claims made months after the deceased's date of death and to spare the court from being burdened with such claims.
Whilst the court accepted that the relevant delay was only 13 months as a result of the standstill agreement the judge cast serious doubt on the efficacy of such agreements in future cases and referred to such arrangements as giving away "time that belongs to the court".
The court had to be satisfied that the reason for the delay in making an application for reasonable financial provision had been for good reasons and the claim itself had sufficient merit to be allowed to proceed to trial. This was not an exercise of discretion for the court but a value judgment.
The claimant failed to demonstrate any good reasons for the delay in making her claim and had been made aware of the six month time limit. The claimant also failed to show that the claim was of sufficient merit to be allowed to proceed to trial given the generous trust arrangement which her late husband had set up.
This case serves as a reminder to bring applications for reasonable financial provision promptly. Trustees should also exercise caution when entering into standstill agreements for such claims as this case suggests that judges may no longer recognise such arrangements. The court directed that in such circumstances it was preferable for claimants to issue protective proceedings and then apply to have the proceedings stayed for the purpose of negotiations.