Inheritance Act claims: The case of Ramus v Holt

In the case of Ramus v Holt [2022] EWHC 2309 (Ch), the Court has dismissed an application for reasonable financial provision that ultimately revolved around a personality clash between the applicant and one of the trustees

Background

Mr and Mrs Ramus were estranged at the time of Mr Ramus' death. Their daughter was one of the executors and trustees of Mr Ramus' will. In his will, Mr Rasmus directed that his estate be held on life interest trust for the benefit of Mrs Ramus. The trustees had power to apply capital from the trust for her benefit, and a power to terminate the life interest. Subject to the life interest, the trust fund was held on discretionary trusts for beneficiaries including Mrs Rasmus and her children. The trustees could exclude Mrs Rasmus from benefiting from the discretionary trust.

Mrs Ramus described her relationship with her daughter as "strained". She had concerns that she might not receive sufficient capital and/or income from the trust to allow her to maintain her lifestyle. She was also concerned that the security of her future finances was in the hands of the trustees. In light of this, she said she did not feel that reasonable financial provision had been made for her in the will.  Furthermore, she considered that Mr Ramus would have agreed to pay her a monthly sum to support her outgoings had he not passed away.

She sought orders from the High Court that:

• The trust would be amended to remove the trustees' ability to exclude her as a beneficiary.
• She would receive a minimum sum from the trust.
• The trustees would be removed and replaced. She claimed that this would be reasonable financial provision for her under the Inheritance Provision for Family and Dependants Act 1975 (the "1975 Act") and that it would protect her from the purportedly "unfettered discretion" of the trustees, particularly her daughter.

What does this case tell us?

It is difficult for applicants to claim reasonable financial provision under the 1975 Act where the claim is not founded on a need for income or capital, but instead stems from strained relationship dynamics between the applicant and a trustee or personal representative. Mrs Ramus' argument was unusual.

It is important to consider the root cause of an applicant's claim. While in many cases the applicant will have a genuine financial need (or believe that to be the case), they could possibly also be using a 1975 Act claim to address a family conflict, or another claim that should be pleaded separately.

Another interesting point to note is that the Judge reiterated comments made in earlier cases that Duxbury calculations (designed to identify the capital sum required to meet a series of periodical payments) are a useful guide and tool, but not a requirement for calculating a capital sum.