Welcome to the Summer 2015 edition of our Legacy

Bulletin newsletter

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Welcome to the Summer bulletin from the Stone King Legacy Team.

This edition will look at our upcoming events and pick up on the latest legacy related legal

updates and interesting developments.

We would also appreciate your views on the way that charities could potentially maximise

legacy income. Simon Lofthouse, the newest member of our legacy team and specialist in

cross border matters, has provided us with his profile as well.

Remember to also keep an eye on our website and twitter feeds for updates and news as we

approach our lunchtime seminar. If you haven’t already done so, please join our lively

LinkedIn group.

A number of you will have attended our lunchtime legacy seminar on ‘Giving in the EU just got

easier’ on 26 June 2015. To those of you that attended we hope that you found this interesting

and a great opportunity to meet our team. For those that would like to see it again or missed

out, Dan Harris, Head of the Cross Border Unit, will be recording an online webinar that can

be streamed from our website shortly.

On behalf of the Stone King Legacy Team, best wishes for another successful month. We look

forward to seeing you at our next lunchtime legacy seminar on 16 October 2015.

In the meantime, if you have any questions or if you would like us to address a particular

subject in the future, please contact either myself or a member of our specialist legacy team.

Sarah Eden

Solicitor, Legacy Team

01225 324434

SarahEden@stoneking.co.uk

Lunchtime Legacy Seminar: Ilott v Mitson [2015] – the practical

implications for charities with Kate Selway of Radcliffe

Chambers on 16 October 2015

We are pleased to invite you to a presentation on the recent and topical case of Ilott v Mitson

[2015]. This will focus on the practical implications of the case for charities.

Kate Selway, an experienced barrister in contentious probate and private client disputes from

Radcliffe Chambers, will take you through the recent decision, the departure (if any) from the

previous decisions on claims by adult children, the likely impact on charities, how to respond

to the claims being made and advice that could be offered to avoid such claims in the future.

This event will provide an insight into an important and topical case for legacy officers and

their managers. The presentation will be chaired by Paul Sutton, a Partner in Stone King’s

Legacy Team. There will also be an opportunity for questions and discussions, as well as light

refreshments from 12.15pm, with the presentation starting at 1pm on 16 October 2015.

Please click here to view full details. This event is free to attend but we ask that you pre book

your place so that we can ensure sufficient seating and catering.

Case Updates

Ilott v Mitson [2015]: what does the recent decision mean for

charities?

The Court of Appeal has granted an award to Ms Ilott of £143,000 to purchase a home plus

reasonable costs of the acquisition and a lump sum of £20,000 to provide for her income

needs from Mrs Jackson’s estate. The award amounts to approximately one third of the estate

and was based on the following reasons:

The award had been incorrectly limited on the basis of lack of expectancy, ability to live

within her means, and failure to verify the assumption that any award would impact on

her state benefits.

The Court did not need to concern itself with providing Ms Ilott with an income that

would fully support her needs as she has an adult child living independently.

The Charities would not be prejudiced by receiving a lower amount as it would be a

windfall. The Charities did not expect any money from Mrs Jackson as she had no prior

link to them and did not have the same financial needs.

After balancing the claims on the estate, the Court of Appeal found that where a party has

extra financial needs because they were relying on state benefits and those benefits can be

preserved by the provision of housing, this ought to be made as an award from the estate.

Unless there is a further successful appeal to the Supreme Court, it looks like this case will

mean it is harder to disinherit a child and charities would be well advised to be wary of

applicants who have special financial needs, such as those in receipt of state benefits, the

elderly or individuals with disabilities.

Full details of the case can be seen here.

We have also completed an interview with Lexis PSL for those that are interested, please click

here.

King v Chiltern Dog Rescue [2015]: the doctrine of donatio

mortis causa (DMC) should not be relied on as a substitute for

making a valid will

DMC allows a deceased donor to transfer property to a recipient on death without complying

with the formalities required when making a will. It is an anomaly in English law today. There

are three requirements for a DMC: a) a gift must be made in contemplation of impending

death; b) the gift must be contingent on death; and c) there must be delivery of the gift.

In the case of King, the deceased made a will in 1998 leaving the bulk of her estate to seven

animal charities. In 2007, the deceased’s nephew moved in with her shortly after separating

from his wife. The nephew stated in 2010 that the deceased gave him the title deeds to her

unregistered property and told him ‘this will be yours when I go’ and then made three invalid

wills attempting to leave the property to him. The latest attempt was around four months

before her death.

The Court of Appeal has held that the deceased did not make a valid deathbed gift of the

house because she had been unable to satisfy the first two requirements. Although elderly

and conscious of her failing health, there was no reason to expect an imminent death. She

had the time and capacity to approach solicitors and have a new will drafted. The statement

that was allegedly made did not indicate a gift conditional on death, but a statement of

testamentary intent.

It is clear that the three requirements of a DMC must be strictly construed. Successful cases

are likely to be measured in days rather than weeks and anticipation of death but that this

must be from a known cause. Full details of the decision can be seen here.

Charities beware: Data Protection Act 1998 – the right of

claimants to recover damages following the decision in Google

Inc v Vidal-Hall [2015]

By a radical decision in Google Inc v Vidal-Hall and others the Court of Appeal has held that,

amongst other things, claimants may recover damages under section 13 of the Data

Protection Act 1998 (the “Act”) even though there has been no financial loss.

A complainant’s ability to claim damages for breach of the Act without incurring financial loss

will certainly be a concern to any data controller however there is a particular fear of the

impact of the Judgment on charities. Charities have been facing widespread criticism for

processing and passing on personal data of individuals to third parties. For instance the media

has recently reported a story about former army Colonel, Samuel Rae whose personal details

were allegedly sold to unscrupulous companies resulting in him to lose £35,000 and get circa

731 demands for cash.

The law had formerly drawn a distinction between compensation for financial loss and

compensation for distress. Compensation for distress could only be claimed if financial loss

could be shown, even if it was no more than the nominal cost of changing one’s phone

number or email address. Only if that could be shown, would the door open to a claim for non-

financial loss, i.e. compensation for distress (which is considerably more lucrative).

In Vidal, however, the users (complainants) sought damages for distress even though they

had suffered no financial loss. Please click here for full details of the case.

Legacy Survey: maximising legacy income or a step too far?

From 6 April 2012, any estate which leaves at least 10% of its taxable value to a charitable

cause will be able to take advantage of a reduced rate for inheritance tax of 36% rather the

usual 40%.

For those already leaving a legacy to a charitable cause, the rules result in a sweet spot at 4%

of the taxable value of the estate where there is no greater cost to the beneficiary or

beneficiaries of the estate if the legacy to a charitable cause of 4% is raised to 10%.

This presents an opportunity for charities, individually or collectively, to maximise the potential

legacy from the estate but without any financial consequences to the beneficiary or

beneficiaries, existing or future supporters of the charity.

Please click here to access an example letter addressed to the executors of a Will where the

above circumstances apply. However, would charities be willing to use it as a basis for

investigating the possibility of maximising legacy income? Is it a step too far?

We’d be very interested in your views and ask that you answer the three short questions in our

survey here. Please feel free to add comments too. We’ll publish the results in our next

bulletin.

Profile:

Simon Lofthouse

Most memorable moment in law? I

was a trainee solicitor and I had been

asked to take part in a local question

time in my town. I remember getting into

a debate with the local MP against the

introduction of personal independence

payments replacing disability living

allowance. It dawned on me during the

argument that this was one of the

reasons why I chose to become a

solicitor, to speak out for those that are

less fortunate.

What do you do outside of work? My

Background

After 12 (very enjoyable) years in the

Royal Navy, I qualified as a solicitor. I will

be forever grateful to the Royal British

Legion and the Royal Naval Benevolent

Trust for supporting me financially in

making the transition into the legal

profession. I now specialise in cross

border trusts and estates and find myself

talking to clients all around the globe in

the space of a morning. My experience of

travelling and meeting people all over the

world with the Royal Navy has certainly

been of benefit.

Most enjoyable part of your job?

My job is fantastic - it is technically

challenging as it involves looking at the

laws of different countries and then trying

to marry these laws to find the legal

answer. Where the international laws

conflict and there is no legal answer, it is

very satisfying to identify pragmatic

solutions; essentially thinking outside the

box.

Meeting people with very different

experiences and backgrounds is often

fascinating and a real pleasure.

free time is mainly spent with my young

family - our season ticket to Longleat

Safari Park certainly gets a lot of use!

Visits to the rugby and the pub are also

rare treats. I help out in my local

community and have been a trustee and

legal adviser to my daughters’ former

nursery for some time now. I have

fundraised for Macmillan and Age UK

and provided talks for Alzheimer’s

Support and the Defence Recovery

Capability Team. I am always kept very

busy!

Simon Lofthouse

Email: SimonLofthouse@stoneking.co.uk

Tel: 01225 326780

Upcoming

Events

16.10.15: Lunchtime Legacy Seminar

on 'Ilott v Mitson [2015]' and the

practical implications for charities

with Kate Selway of Radcliffe

Chambers

January/February 2016 - Young

Charity Group Professionals Drinks

If you have any queries or for further information on Legacy issues, please contact Sarah

Eden by email SarahEden@stoneking.co.uk or telephone 01225 324434.

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© Stone King LLP 2015

This publication is for guidance only. The law and practice

referred to has been paraphrased or précised and should not

be construed or relied upon as legal advice.

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