Lesley King comments on a case where the time to comply with the condition of a will expired before the beneficiaries were aware of it – and on Scarle v Scarle, which dealt with deaths in uncertain order.
Conditional gifts in will-drafting
Naylor v Barlow [2019] EWHC 1565 (Ch) is an unfortunate example of problems that can be created when drafting a will.
The testator (who died in January 1992) had farmed land in partnership with his wife and two of their four children, John and Philip. His two other children, Beryl and Basil, were not actively involved in the farm. As sole freehold owner of the land, he granted an agricultural holding tenancy to the partnership at an annual rent. He left his interest in the farm to his wife, John and Philip, as tenants in common as to one third each, but subject to the proviso that the gift to the sons was conditional on “each of them paying within a period of nine months from the date of my death to each of my daughter Beryl Eunice Clowes and my son Basil Hine the sum of £15,000 so that each son shall pay a total of £30,000”. In the event of either John or Philip failing to satisfy the condition imposed upon their gift, the testator devised the interest in the farm “which such son would have taken had he satisfied the condition subject to any agricultural tenancy to which the said farm may be subject at my death equally between my said daughter Beryl Eunice Clowes and my said son Basil Hine as tenants in common”.
John did not satisfy the condition, so his interest passed to Beryl and to Basil. Philip had predeceased his father and so was unable to satisfy the condition.
The will had no express substitution clause for issue of a predeceased child but section 33 of the Wills Act 1837 was not excluded. Hence, Philip’s two children were entitled to the property left to their father.
However, issue taking under section 33 are subject to the same conditions that would have applied to the gift to their parent (see Ling v Ling [2002] WTLR 553). Philip’s children had not satisfied the condition.
It was clear from the evidence that they were not invited to do so nor were they even aware of the existence of the condition. In January 1992, the solicitors acting for Philip’s widow had written to the solicitors acting for the testator’s estate asking whether Philip’s children had any interest in their grandfather’s estate but received no reply. The estate solicitors did send a copy of the will on 5 July 1993 (the condition having expired in October 1992). Both firms agreed that “the gift of the share in the farm to Philip Hine under clause 3 of the will of his father is personal and lapses”. The unchallenged evidence of Philip’s children was that, even though they were then adults, they had no knowledge of the terms of the testator’s will and no idea that this correspondence had been passing between the two firms of solicitors. There was a delay in obtaining a grant of probate to the testator’s estate so that it was not available to the public until 27 April 1995, some two and a half years after the time for satisfying the condition had passed.
The children argued that because the condition was a condition subsequent that was impossible for them to satisfy as they were never told of it, they took the gift free of the condition.
Sadly, His Honour Judge Hodge QC held that they were bound by the condition. There is a distinction in law between the situation where beneficiaries fail to fulfil a condition (otherwise capable of fulfilment) simply because they do not know about it in sufficient time to do so, and the situation where it is physically impossible for them to fulfil the condition (for example where an animal charity cannot look after the testator’s dog because he was no longer in possession of any dog at the time of his death).
Phillip’s children could not be in a better position than their father would have been
The distinction is justified because in the latter situation, neither the testator nor the beneficiary has any control over whether or not the condition can be fulfilled. In the former situation, however, it is within the testator’s power to fulfil the condition contingent upon the beneficiary having been notified in sufficient time to meet the condition (as by requiring it to be performed only within a specified period of time after the beneficiary has been notified).
The judge pointed out that had Philip survived but been left in ignorance of the condition, to allow him to inherit free from the condition would have run counter to the clearly expressed wishes of the testator. He never intended the gift to either of his sons (of a one-third share in the farm) to take effect unless they complied with the condition. Compliance was to take place within nine months from the date of his death and not within nine months, or any other period of time, from notification of the condition. Phillip’s children could not be in a better position than their father would have been.
The judge’s final comment is salutary: “If any lessons are to be learned from the present case, it is that the draftsman of a will incorporating a condition along the lines of clause 3 should consider expressly making the time for compliance run only from the time of notification of the condition to the relevant beneficiary.”
When drafting a will with such a condition (or an option to purchase which often raises the same issues) as well as making time run from notification, it is also worth imposing an obligation on the personal representatives to inform the legatees of the time limit.
Deaths in uncertain order
Readers may have seen the recent decision in Scarle v Scarle [2019] EWHC 2224 (Ch) on the rule imposed by Law of Property Act 1925, section 184 and wondered why it was litigated. The rule is that where “two or more persons have died in circumstances rendering it uncertain which of them survived the other or others, such deaths shall (subject to any order of the court), for all purposes affecting the title to property, be presumed to have occurred in order of seniority, and accordingly the younger shall be deemed to have survived the elder”. The answer is that there was some forensic evidence that the wife, who was the younger, might have died first.
The order of deaths was crucial as the couple’s property was all owned jointly and the dispute was between the daughter of the husband and the daughter of the wife.
Unfortunately for the daughter of the husband, the court held that the evidence was not sufficient to establish the order of deaths on the balance of probabilities, so the uncertainty remained and the presumption applied.
Had the property been capable of passing by will, as opposed to owned as beneficial joint tenants, the intestacy rules would have applied. Under the intestacy rules a spouse must survive 28 days in order to inherit (Administration of Estates Act 1925, section 46(2A)).
