Death Bed Gifts
The case earlier this year of Keeling -v- Keeling has reinforced the Court’s position to try to move away from the rule relating to death bed gifts.
For a death bed gift to be valid three strict requirements need to be met. They are:
- The gift must be made in contemplation of impending death.
- The gift must be an outright gift but only take effect when the person dies. Until that person does die the gift could be cancelled at any time.
- There must be a “handing over” of the subject matter of the gift to the person who is receiving it.
The case of Keeling -v- Keeling was between family members following the death of their sister and aunt Ellen Exler. Ellen died at the age of 91 on 12 November 2012. She was a widow and had no children. She also hadn’t prepared a Will so under the laws of intestacy her estate will be divided between her two brothers Frank and Stephen and her two nieces.
Her brother Stephen stated that in May 2012 after Ellen had suffered heart failure she gave him the Title Deeds and keys to her property Hadleigh House. He also said that she told him that she would rather he had it than anybody else.
This came as somewhat of a surprise to the other beneficiaries and also to various independent witnesses who gave evidence that there had been some hostility between Ellen and her brother Stephen and his wife.
When the case came to High Court the Judge looked at the claim in line with the three requirements set out above.
The Judge ruled that the death bed claim made by Stephen was “hopeless” and in particular took the view that although Ellen had suffered a heart attack in May 2012 she was not hospitalised at that point and in fact survived for a further six months. Therefore, she did not have a good reason to be in contemplation of an anticipated death and she had plenty of time to perfect the gift before she died 6 months later. Therefore, the death bed gift failed and the estate including the property was divided between all the family members.
This case seems to be following a line that the Court is moving away from enforcing death bed gifts which avoid all the statutory protections that preparing a Will and taking advice would cover.
However, we know from experience that when people are contemplating their death their view on matters can change and it can also crystallise thoughts that potentially they have had for many years but have not put into place. That is why at Nash & Co we deliver a flexible and efficient service including visiting clients in hospital and care homes to take advice and producing all the documentation very quickly to ensure that their wishes are fully fulfilled.
Involving a solicitor in these situations will not only help to ensure that the person’s wishes are fulfilled but also reduces the potential for claims against the estate and can also smooth over family situations if the third-party solicitor can explain the reasons behind the decision after discussing it with the individual.
In this case if Stephen’s sister had met with her solicitor and explained that she had intended for him to have the property then the paperwork could have been prepared and Stephen would have received the property and it also would have avoided a lengthy and expensive Court case.
Although none of like to think of our own mortality, careful planning and preparation can save a lot of money and a lot of heartache for those we leave behind.
If you would like more information please contact David Cornelius at Nash & Co.
Email: [email protected]
Telephone: 01752 827076
David Cornelius is a Partner, and Leader of the Wills, Trust and Probate Team. He joined Nash in January 2015 after 12 years with a major Regional and National Law firm.
David and his team provide bespoke, clear and simple advice to individuals on how to best provide for themselves and their families in the most practical and tax efficient manner. In particular, he has experience of advising land owners and entrepreneurs of the most inheritance tax-efficient way to structure their affairs.