The Inheritance (Provision for Family & Dependants) Act 1975 allows certain categories of applicant to bring a claim against a deceased’s estate where ‘reasonable financial provision’ has not been made for them under the deceased’s will or on intestacy. Those categories of claimant include a spouse or civil partner, ex-spouse or ex-civil partner, a child of the deceased or someone treated as a child of the family by the deceased, a cohabitee who has lived with the deceased ‘as husband and wife’ for a period of two years ending on the deceased’s death and a person who was financially dependent on the deceased.
Section 4 of the 1975 Act provides that applications under the Act must be made within six months of the date of the grant of probate (or letters of administration) in the deceased’s estate. From then on, the court’s permission to bring a claim is required.
Given the relatively short timeframe in which proceedings must be issued, it has been common practice for parties to a potential 1975 Act claim to agree a ‘standstill agreement’, effectively that the clock stops running for the six month period. Such agreements allow a claimant to prepare a case properly and for the parties to try to negotiate a resolution without the need for court proceedings.
However, following a judgment by Mr Justice Mostyn handed down this week in the High Court of Justice Family Division after an application for permission to bring a claim under the 1975 Act out of time, standstill agreements may no longer have a place and should be used with caution (Cowan v Foreman and others  EWHC 349 (Fam)).
Mr Justice Mostyn commented: “I was told that to agree a standstill agreement of this nature is ‘common practice’. If it is indeed common practice, then I suggest that it is a practice that should come to an immediate end. It is not for the parties to give away time that belongs to the court. If the parties want to agree a moratorium for the purposes of negotiations, then the claim should be issued in time and then the court invited to stay the proceeds while the negotiations are pursued. Otherwise it is, as I remarked in argument, simply to cock a snook at the clear Parliamentary intention.”
The moral of the story is therefore:
It will remain to be seen whether the courts will see an increase in the issue of 1975 Act claims following this judgment, but in an era where the issue of proceedings is generally seen to be a last resort, it might in fact become one of the first steps taken when instructed on claims of this kind in future.