England and Wales High Court (Chancery Division) Decisions

IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION

		Claim No: HC12E03256
		1 July 2014

MR CHARLES HOLLANDER QC:

1. The 15^th- 21^st Defendants ('the Charities') are the residuary beneficiaries of the will of the late June Margaret Fairbrother ("June"), dated 20^th March 1998 ('the Will'), which also leaves a total of £19,000 in legacies to friends and family. June died on 10^th April 2011 and the Will was admitted to probate on 28^th February 2012.
2. At the date of her death, June lived at 12 Kingscroft Road, Harpenden, Hertfordshire AL5 1EJ ('the Property') with her nephew Mr Kenneth King, the Claimant. The Property is the principal asset of the estate and has recently been valued at £350,000.
3. Mr King's primary claim is that June made a donatio mortis causa ('DMC') of the Property to him between 4-6 months before her death by handing him the deeds to the Property saying 'This will be yours when I go' or similar words
4. If Mr King is unsuccessful in establishing a DMC, his alternative claim is brought under the Inheritance (Provision for Family and Dependants) Act 1975 ("the 1975 Act"). Mr King says that he moved in with the deceased in June 2007 in order to care for her and that he lived rent free at the Property thereafter. He says that he gave up a bedroom and lounge he was renting from a friend in Kent at a cost of £600 per month. He claims he was dependent on his aunt for just under four years until her death.
5. The information which I was given as to the other Defendants, who did not appear at the trial, was as follows. The 1^st and 2^nd Defendants are two of the executors of the Will and have filed acknowledgments of service stating that they do not intend to contest the claim. The 3^rd to 14^th Defendants are pecuniary legatees under the Will. The 6^th Defendant has filed an acknowledgment stating that she does not intend to contest the claim, but does not consent to an order in the terms requested by Mr King. The 7^th Defendant has indicated that she intends to contest the claim but this appears to be limited to asking that any relief does not affect her legacy and nothing further has been heard from her. The 5^th, 10^th, 11^th and 12^th Defendants have filed acknowledgments of service stating that they do not intend to contest the claim. The contest is thus between Mr King and the Charities.

Witnesses

6. In the course of the trial, I had written or oral evidence from Mr Simeon Jenkin (Civil Evidence Act "CEA"), Ms Winifred Tilley, Mr Jeremy Gray, Mr David King, Ms Trudy Manning (CEA), Ms Kay Bringmann, Ms Pauline King (CEA) and Ms Barbara Constable. Ms Constable, who is an officer of St Alban's City and District Council, was able to assist in relation to Mr King's application for benefits and documents relating thereto. The other witnesses who gave oral evidence had limited knowledge of the matters relevant to the case and, although giving honest evidence, were of limited assistance. It was the evidence of Mr King which was pivotal to this case.

DMC: the law

7. DMC takes effect as an historic and anomalous exception to the requirements of the Wills Acts. Its continued existence as a legal principle was confirmed by the Court of Appeal in Sen v. Headley [1991] Ch 425, which is the leading modern case on DMC. DMC involves a present gift which takes effect in the future and remains conditional until the donor dies: see generally Williams Mortimer and Sunnucks, Executors, Administrators and Probate, Ch 42. Until that point it may be revoked by the donor, but on death the gift is absolute. In In re Beaumont [1902] 1 Ch. 892, 893, Buckley J described a DMC as:

"a singular form of gift. It may be said to be of an amphibious nature being a gift which is neither entirely inter vivos nor testamentary. It is an act inter vivos by which the donee is to have the absolute title to the subject of the gift not at once but if the donor dies. If the donor dies the tide becomes absolute not under but as against his executor.

In order to make the gift valid it must be made so as to take complete effect on the donor's death".

8. The court must also distinguish between a genuine DMC, which meets the requirements set out in case law, and an attempt to make a testamentary gift otherwise than in accordance with the Wills Act 1837. In Birch v Treasury Solicitor [1951] Ch. 298, 307 Lord Evershed MR stated:

"the courts will examine any case of alleged donatio mortis causa and reject it if in truth what is alleged as a donatio is an attempt to make a nuncupative will, or a will in other respects not complying with the forms required by the Wills Act."

9. In Cosnahan v. Grice (1862) 15 Moo PC 215 the Privy Council emphasised the burden of proof in such cases:

'Cases of this kind demand the strictest scrutiny. So many opportunities, and such strong temptations, present themselves to unscrupulous persons to pretend these deathbed donations, that there is always danger of having an entirely fabricated case set up. And, without any imputation a fraudulent contrivance, it is so easy to mistake the meaning of a person languishing in a mortal illness, and, by a slight change of words, to convert their expressions of intended benefit into an actual gift of property, that no case of this description ought to prevail, unless it is supported by evidence of the clearest and most unequivocal character.'

10. In In Re Craven's Estate [1937] Ch 423, 426, Farwell J set out the conditions essential to a valid DMC as follows:

"The conditions which are essential to a donatio mortis causa are, firstly, a clear intention to give, but to give only if the donor dies, whereas if the donor does not die then the gift is not to take effect and the donor is to have back the subject-matter of the gift. Secondly, the gift must be made in contemplation of death, by which is meant not the possibility of death at some time or other, but death within the near future, what may be called death for some reason believed to be impending. Thirdly, the donor must part with dominion over the subject-matter of the donatio''

11. This was echoed by the Court of Appeal in Sen v. Headley [1991] Ch 425. Nourse LJ set out the requirements of a valid DMC at 431:

"First, the gift must be made in contemplation, although not necessarily in expectation, of impending death. Secondly, the gift must be made upon the condition that it is to be absolute and perfected only on the donor's death, being revocable until that event occurs and ineffective if it does not. Thirdly, there must be a delivery of the subject matter of the gift, or the essential indicia of title thereto, which amounts to a parting with dominion and not mere physical possession over the subject matter of the gift"

12. It is not enough for this purpose merely to contemplate death 'at some time or other'. What is essential is the contemplation of 'death within the near future, what may be called death for some reason believed to be impending.' (In Re Craven's Estate [1937] Ch. 423, 426). Most of the reported cases concern deaths which took place shortly after the gift had been effected when the donor was gravely ill. For example: (1) Sen v Headley [1991] Ch 425: death 3 days after the gift (2) In Re Craven's Estate [1937] Ch. 423: death 5 days after the gift; and (3) Birch v Treasury Solicitor [1951] Ch. 298: death 4 days after gift was repeated.
13. However, in Vallee v Birchwood [2013] EWHC 1449 (Ch), the testator had effected the alleged gift on 4^th August 2009 when he was visited by his daughter, who lived abroad. She found him unwell and coughing badly. He stated that he did not expect to live much longer and that he might not be alive by Christmas when his daughter told him she expected to visit again. He gave her the deeds, a set of keys and some personal effects, which she took away. He died at the start of December. The deputy judge on appeal affirmed the decision of the trial judge that the contemplation of death within 5 months - by Christmas that year - was contemplation of impending death. He further made clear that the continued enjoyment of the property during the life of the donor was not incompatible with an intention to make a gift which was effective on the donor's death.
14. It is apparent from Sen v Headley that unregistered land can be the subject of a DMC. What is required in the case of property which is not capable of physical delivery is for the donor to part with dominion over the essential 'indicia of title': see Williams at para 42-17. Birch v Treasury Solicitor [1951] Ch 298 concerned the handing over of Post Office and bank deposit books. This was sufficient to effect a DMC. Lord Evershed MR, giving the judgment of the Court of Appeal, reiterated that symbolic delivery of tokens was not enough, there must be transfer of the subject matter of the gift or of 'something amounting to that'. He went on to define the 'indicia' in this way:

"...the indicia of title, as distinct from mere evidence of title, the document or thing the possession or production of which entitles the possessor to the money or property purported to be given.'

A little later he noted:

'we think that the real test is whether the instrument "amounts to a transfer" as being the essential indicia or evidence of title, possession or production of which entitles the possessor to the money or property purported to be given'

15. In both Sen v. Headley and Vallee v. Birchwood the donors caused the title deeds of their unregistered land to be put under the control of the donees and this was sufficient f6r dominion to pass, notwithstanding that in the latter case the deceased continued to live at the property. In Sen, the donor gave his partner the keys to the box containing the deeds, which was located in their house. He remained in hospital until his death. In Vallee the title deeds were simply taken away by the donee.
16. To find a DMC the court must further be satisfied that June had capacity to make it. In a case where the effect of the alleged gift is to give away substantially the whole of a person's estate and defeat his testamentary dispositions the test for capacity is the same as that for making a will. The donor must understand the extent of the property to be disposed of and the claims of all potential donees; see In re Beaney [1978] 1 W.L.R. 770.

DMC: the facts

17. Mr Kenneth King is aged 58. He has had a somewhat chequered career. He was made bankrupt in 1990 and then in 1996 was disqualified from acting as a company director for 8 years. He was made bankrupt again in 2000. His failed businesses led to significant unpaid debts. In August 2005 he was convicted of acting as a company director while disqualified and sentenced to 12 months in prison after a not guilty plea. At his crown court trial the judge said that the offences were

"flagrantly committed with total disregard for the disqualification order and bankruptcy."

18. Mr King was released from prison in December 2005. His marriage collapsed and he moved out of the matrimonial home in October 2006. He said that he worked in business with his friend Mr Paul Whitehead from September 2006 to June 2007. His evidence was that he stayed with Mr Whitehead at 5, York Road Tunbridge Wells. He had the back bedroom and front lounge. £600 per month was deducted from his business takings for rent.
19. He said he had a conversation with his aunt June in 2007, at a time when she was increasingly elderly and frightened of going into a home, and agreed to move in with her to look after her. He then gradually wound up his business with Mr Whitehead, which took about a year, and increasingly spent all his time with June living in the Property in Harpenden.
20. June was a retired policewoman (at a time when it must have been less common ' for a woman to have a long police career) who adored animals. She had a variety of cats and dogs in her property and within the family it was common knowledge that she intended to leave her property to animal charities (as she did substantially in her 1998 will). She helped with animal charities and animals were a large part of her life.
21. Mr King's evidence was that June never discussed the existence of a will but on a number of occasions told him that the Property would be his after her death. In the period shortly before her death, she signed documents to the effect that Mr King should have the Property when she died. On 19 November 2010 she wrote as follows:

"In the event of my death I leave my house 12 Kingcroft Road Harpenden & Property to my nephew Kenneth King in the hope that he will care for my animals until their death-demise and & my money in the bank."

22. On 4 February 2011 she wrote a similar document:

"In the event of my death I leave my house Garden Car etc and everything to Kenneth Paul King same address in the hope that he will care for my animals as long as possible."

This document was witnessed by her friend Mrs Teri Walker.

23. A farther document was dated 24 March 2011

"THIS WILL dated 24^th day of March Two Thousand and Eleven is made by me JUNE MARGARET FAIRBROTHER (nee King) of 12 Kingcroft Road Harpenden Hertfordshire AL51EUJ

1. I REVOKE all former Wills and other testamentary dispositions made by me and declare this to be my last Will

2. I WISH my body to be cremated and my ashes to be scattered and I WISH my name to be inscribed on the rosebush plaque commemorating my late mother MARGARET RACHEL KING and father HENRY KING

3. I APPOINT my nephew KENNETH PAUL KING of 12 Kingcroft Road Harpenden Hertfordshire AL5 1EUJ to be sole executor

4. SUBJECT to the payment of my debts funeral and testamentary expenses and any legacies given by this will or any codicil hereto I GIVE to my nephew KENNETH PAUL KING my property at 12 Kingcroft Road Harpenden and my entire estate absolutely

5. I REQUEST AND HOPE that he care for my dogs Tinker, Bonnie and Patch and my cats Blackie and Katie until their death"

This document was not witnessed.

24. None of these documents constitute valid wills in law.
25. Mr King's witness statement in relation to the DMC claim stated as follows:

"29. On another occasion, about four to six months before she died, June presented me with the deeds to the Property and again said to me that "this will be yours when I go." As the property is unregistered, the documentation included an epitome of title from 1900 to date. From her tone of voice and her seriousness when she gave me the deeds, I had no doubt in my mind at the time, that she thought that she was giving me what she thought I would need when she died, so that the property would belong to me. She was a smart woman and understood that the deeds represented ownership of the house.

30. At that time, June's general health was deteriorating. She had not yet become bed-ridden, although this did happen fairly shortly afterwards.

31. June was not prone to using phrases of the sort, "when I go" as she was not the sort of person to spend time morbidly considering the end of her life. Her use of the words and the way she looked at me at that time made clear to me that she knew her health was failing and that her death was approaching. I took the bundle of documents from her and wrapped them in a plastic bag and put them in my wardrobe. Prior to this incident, I had not seen the deeds before."

26. Mr King said that the deeds to the Property were not in the house. The day June gave them to him she had been out with Ms Walker, who took her out in taxis sometimes to give him a break, and he believed she collected the deeds that day from a solicitor or bank.

The challenges to Mr King's evidence and case.

27. It was Mr King's evidence that was central to the case, and I must consider whether and to what extent I accept his evidence.
28. Not surprisingly, counsel for the Charities launched a full scale attack on Mr King's evidence. In relation to the DMC claim, the challenge was on two separate fronts:

1) That Mr King's evidence was unreliable and should not be accepted

2) That even if his evidence was accepted, or largely accepted, the DMC case was not made out.

29. The principal challenges to Mr King's evidence and case were as follows:

29.1. It was submitted that Mr King was someone who had previously been imprisoned for what amounted to fraud offences, that he had been made bankrupt twice and had left large numbers of debts behind him. Mr King has shown disregard for the niceties of law and honest behaviour.

29.2. The story told by Mr King was too convenient by half and the court should not accept anything Mr King said unless independently corroborated.

29.3. There were no witnesses to the crucial conversation with June and no corroboration.

29.4. Mr King's evidence was designed to give the impression he had devoted himself to his aunt from 2007; however there was not a single entry in relation to his bank account from the Harpenden area until 16 July 2008, a year later. The entries were mostly from the Tunbridge Wells area. Even then, he was hardly a full-time carer. In a 2011 Council Tax Application however Mr King described himself as a "24x7 live in carer". He said the same in the letter he wrote to his uncle and cousin (12 August 2011 letter, where he stated that the date was "late 2006".) However, at least in 2007, that was simply not true.

29.5. Analysis of Mr King's bank statements and his sources of funds was not satisfactory. He claimed that payments into his account were either gifts or loans from June, from Ms Teri Walker, residual monies from his business with Mr Whitehead or related to small jobs he did. His evidence on these matters was, it was said, incredible and he did not provide any sort of satisfactory answers as to these matters.

29.6. He misled the Legal Services Commission and St Albans CDC as to his bank accounts and only disclosed his Santander account whereas in fact he was using his Nationwide account as well. He ultimately told St Albans CDC that the Nationwide account was in his name only, which was not true.

29.7. His evidence was that the "Churchill Cigar Club" was not a business venture but in two documents he signed, he said that it was.

29.8. St Albans CDC were not satisfied with his disclosures in relation to Council Tax and referred the matter internally to assess whether there was evidence of fraud. However, no further action has been taken.

29.9. In initial correspondence from his solicitor, no mention was made of DMC and proceedings were foreshadowed under the 1975 Act only.

30. It is true that there were several matters going to credit on which Mr King's evidence was not consistent with documents he had signed or created. It was also apparent that Mr King engendered strong feelings, and there were a number of people, both within his family and elsewhere, who regarded him as untrustworthy and unreliable and in some cases dishonest. The judge who sentenced him to prison in 2005 plainly did not think much of his integrity either.
31. I confess I have not found it an easy question whether to accept Mr King's evidence. The matters in relation to which counsel for the Charities relied as giving reason to disbelieve Mr King's evidence were matters principally going to credit (although they had some relevance to the claim under the 1975 Act). Mr King largely accepted that in various documents he had made errors or failures to make complete disclosure.
32. Whilst they gave me further cause to be cautious as to Mr King's evidence relevant to DMC, none of the points made were individually of such significance as of itself necessarily to lead me to consider that I could not rely on Mr King's evidence. However, in relation to that part of his evidence which related to DMC, Mr King's evidence given orally was consistent with that in his witness statement and, save that there was a minor difference in the precise words used which I regarded as inconsequential his evidence on the crucial matters was entirely unshaken.
33. In reaching the conclusion that Mr King's DMC evidence should be accepted, what seemed to me important was the evidence of the various unsuccessful attempts by June to make a new will in Mr King's favour. All of these were unsuccessful in law, but, crucially, there was no challenge to the authenticity of any of these documents. In one case, the document was witnessed by Teri Walker (who is unfortunately now deceased herself). These documents provide powerful corroborative evidence that in the period shortly before her death, June was seeking to leave her property (including the Property which was her principal asset) to Mr King. In my judgment, these documents make it much more likely that the conversation which Mr King recounted took place.
34. DMC is not a principle which is likely to be known to any lay person. Although I have no knowledge of privileged communications between Mr King and his lawyers, it can perhaps be inferred that the possibility of such a claim arose in the course of discussions between Mr King and his lawyers. Not many lawyers have familiarity with the principle, I do not regard it as surprising that it was not immediately identified as a possible cause of action.
35. Having taken into account the points made by counsel for the Charities, and approaching Mr King's evidence with a very considerable degree of circumspection, my conclusion is that, at least in relation to the central matters relevant to DMC, I accept his evidence.

Does Mr King's evidence give rise to a DMC?

36. Counsel for the Charities argued that it did not give rise to a DMC for the following reasons:

1. Cases of this nature demand the strictest scrutiny,

2. The court cannot be satisfied as to June's capacity

3. Words used not suggestive of a gift conditional on death

4. There was no contemplation of impending death

5. There was no parting with possession

6. The gift was revoked

37. I shall deal with these points individually

(i) Strict scrutiny

I have referred to the law in this regard above. I have had these authorities in mind when considering Mr King's evidence.

(ii) The court cannot be satisfied as to June's capacity

38. Mr Martin Nourse QC said in Re Beaney [1978] 1 WLR 770 at 774:

"The degree or extent of understanding required in respect of any instrument is relative to the particular transaction which it is to effect. In the case of a will the degree required is always high. In the case of a contract, a deed made for consideration or a gift inter vivos, whether by deed or otherwise, the Thus, at one extreme, if the subject matter and value of a gift are trivial in relation to the donor's other assets a low degree of understanding will suffice. But, at the other extreme, if its effect is to dispose of the donor's only asset of value and thus, for practical purposes, to pre-empt the devolution of his estate under his will or on his intestacy, then the degree of understanding required is as high as that required for a will, and the donor must understand the claims of all potential donees and the extent of the property to be disposed of."degree required varies with the circumstances of the transaction.

I direct myself in accordance with this. The issue is whether she had capacity to make a DMC at the time, four to six months from her death, when she purported to do so.

39. The Charities argued that June's signature on the documents produced by Mr King (the failed wills) shows a marked deterioration from her signature on her Will. Mr Simeon Jenkin noted that, as early as 2009, June was suffering from the delusion that one of her cats had gone missing, when in fact it had died some years previously. The eulogy at her memorial service records her 'memory loss.' The evidence is that June was devoted to animals yet, on Mr King's case, she seems to have been become content to make no provision for animal charities at all. Perhaps the strongest evidence was that on one occasion she was seen outdoors half-naked at night.
40. Mr King suggested that the incident relating to June wandering outdoors may have been explicable on grounds of a urine infection. Mr King himself noted that his aunt would sometimes wake in the night believing it to be morning. However, many old people have periods when they show some signs of dementia. There is a world of difference between describing incidents which reflect some loss of memory or preliminary signs of dementia, and reaching a conclusion that an individual did not have the capacity to make a gift of property in the period four or six months before her death. In particular I have in mind that (i) there was no medical evidence before me (ii) the limited information obtained from the GP's notes provides no support for the allegation of lack of capacity (iii) in December 2010 June set out in writing in relatively cogent terms her wishes as expressed to Mr King as to what should occur after her death (iv) as evidenced by the three failed wills over the period shortly before her death, June showed a consistent intent to leave her property to Mr King, and was capable of evidencing that intention by relatively cogent written documents.
41. The evidence did not in my view come anywhere near justifying a conclusion that June did not, when she acted in the manner relied upon by Mr King, have capacity to make a gift of her property.

(iii) Words used not suggestive of a gift conditional on death

42. The Charities argue that there is no sufficiently clear and unequivocal evidence of a gift, whether conditional on death or at all. On Mr King's case June had signed documents not dissimilar to homemade wills. In these she stated that Mr King was to have her whole estate on her death. Shortly before she died, she executed a document which purported to be her will, which was not validly attested. At around the same period it is said that that she handed Mr King a bundle of documents stating 'this will be yours when I go'. The Charities argue:

42.1. The proper characterisation of the alleged conversation is the provision by June of the title documents to allow Mr King to administer her estate on death pursuant to a will. In other words, she gave him the documents as a matter of administrative convenience, rather than as an act of gift.

42.2. The words used by the deceased are not suggestive of a gift of the Property conditional on death. She did not say 'If I die, the house is yours', but rather 'this [the deeds] will be yours when I go'. She did not refer to a gift of the Property at all. There is no conditionality in the statement but rather a statement, at most, of testamentary intent. The case law is clear that it must be a condition of the gift that it will revert to the donor should he recover, though where the donor makes the gift in circumstance where he is gravely ill the court will infer such a condition (see Wilkes v Allington [1931] 2 Ch. 104).

42.3. Mr King describes his aunt as 'a smart woman'. She had previously made a valid Will. There is no reason to suppose that she did not believe that it was not necessary to make such a will and could simply make a gift that would be effective on death by handing over the title documents. Indeed, on the Claimant's case, neither Mr King nor June believed that an effective gift had been effected, as it was thought necessary to prepare a further 'will' in March 2011, which was invalid for want of due execution.

43. I have set out above Mr King's evidence in his witness statement. He was cross- examined at length about the alleged conversation with June. In oral evidence he reiterated that she had gone out that day with Ms Walker and then went to get the deeds, and then handed them to him making it clear the house was to be his when she died. In my judgment the words used, in context, were indeed suggestive of a gift conditional on death and not consistent with any other interpretation. In particular, I reject the suggestion that the purpose of handing him the deeds was to facilitate his position as executor.

(iv) There was no contemplation of impending death

44. The Charities argue that there is nothing to suggest that June was contemplating impending death here. The necessity for some identifiable event that might cause the donor's death or some identifiable, if not precisely defined, period in which the donor expects his death to occur, and on which the gift is conditional, is evident, it is argued, from the descriptions of the elements of a DMC in the cases:

44.1. In In Re Craven the first condition is stated to be 'a clear intention to give, but to give only if the donor dies, whereas if the donor does not die then the gift is not to take effect and the donor is to have back the subject- matter of the gift.'

44.2. Again, in Sen v Headley Nourse LJ noted that 'the gift must be made upon the condition that it is to be absolute and perfected only on the donor's death, being revocable until that event occurs and ineffective if it does not.'

45. The Charities argued that death is inevitable for everyone so, it is argued, the reference to a gift being 'ineffective if [death] does not' occur is indicative that there must be an event or period during which the donor believes he might die, after which, if he does not, one can say that the gift is ineffective. June was not thought to be seriously ill (and had not visited a doctor for some time) although she suffered from high blood pressure; she was not about to undergo an operation or a dangerous journey; she did not express a date by which she thought she might be dead or say that she thought she would die shortly. Her death could have been 12 months, 18 months, or several years away. The fact that she did, in fact, die four to six months after the alleged conversation is no clue as to what was in her contemplation at the time. The coroner's report merely reports that she had been 'feeling unwell for the past weeks' before her death. There is thus, it is argued, no clear and unequivocal evidence of a gift in contemplation of death in the near future.
46. The recent authority Vallee v Birchwood demonstrated that it was not necessary for the death to occur within days of the gift. The contemplation of death within 5 months there was contemplation of impending death.
47. On the facts I have found, the gift was expressly in contemplation of death at a time when it appears that June was increasingly preoccupied with her impending death, as evidenced by the failed wills. I reject this challenge also.

(v) There was no parting with possession

48. In this case, June remained in possession of the Property and the title deeds remained there too, albeit that Mr King says he placed them in a wardrobe. The Charities argue that it cannot be said that a person has parted with dominion over a property when the indicia of title continue to be available to them in their own home and thus within their control. Indeed, the Charities contend that the words used by June do not suggest that she parted with dominion over the documents themselves: she simply stated that they would be the Claimant's 'when I go'.
49. There are two answers to this point. Firstly, Mr King placed the deeds in a wardrobe in his room in the house, in a place which was known to him and which was part of the Property used, in practice, exclusively by himself. Secondly, the terms of the conversation of which Mr King gave evidence indicated that June did indeed intend to part with dominion over the property, but that was to be conditional on her death. The judge in Vallee v Birchwood made clear that the continued enjoyment of the property during the life of the donor was not incompatible with an intention to make a gift which was effective on the donor's death.

(vi) The gift was revoked

50. A DMC is revocable during the lifetime of the donor by notice (Jones v Selby (1710) Prec. Chanc. 300). The Charities contend that even if a DMC was effected some four to six months prior to June's death, any such gift would have been revoked by June's alleged declaration that she wished to leave the Property by will to Mr King in March 2011 (the failed will). Mr King drew up that draft will and thus, it is argued, both parties to the alleged DMC were aware that the Property was intended to pass by an ordinary testamentary disposition and not by reason of a gift effected in June's's lifetime. The fact that this will was ineffective does not alter the fact that both parties proceeded, it is argued, on the basis that June had resumed dominion over the Property so as to provide for it to pass by Will and not by an act in her lifetime.
51. This argument seems technical and unrealistic. I do not see any inconsistency between a gift conditional on June's death made in anticipation of that death on the one hand and on the other hand seeking to perfect that intended gift by a further attempt to create a will. It is unlikely that either June or Mr King had at that time a detailed understanding of the law on testamentary dispositions (if they had, no doubt they would have acted differently in relation to the failed wills) and this argument seeks to provide an over technical analysis of the parties' intentions.

DMC: conclusion

52. I therefore find that June made a valid DMC to Mr King of the Property. In case I am wrong, I go on to consider the 1975 Act claim.

The 1975 Act claim

53. Mr King's claim is brought as a dependant under Section 1(1)(e) of the 1975 Act, which provides as follows:

(1) Where after the commencement of this Act a person dies domiciled in England and Wales and is survived by any of the following persons:—

(e) any person (not being a person included in the foregoing paragraphs of this subsection) who immediately before the death of the deceased was being maintained, either wholly or partly, by the deceased

that person may apply to the court for an order under section 2 of this Act on the ground that the disposition of the deceased's estate effected by his will or the law relating to intestacy, or the combination of his will and that law, is not such as to make reasonable financial provision for the applicant."

54. This is further explained by section 1(3):

'For the purposes of subsection (1)(e) above, a person shall be treated as being maintained by the deceased, either wholly or partly, as the case may be, if the deceased, otherwise than for full valuable consideration, was making a substantial contribution in money or money's worth towards the reasonable needs of that person.'

55. In the case of an application under section 1(1 )(e) 'reasonable financial provision' means -

'such financial provision as it would be reasonable in all the circumstances of the case for the applicant to receive for his maintenance.'^[1]

'Maintenance' in this context means -

'Payments which, directly or indirectly enable the applicant in the future to discharge the cost of his daily living at whatever standard of living is appropriate to him.'^[2]

56. If the court considers that the applicant is eligible to apply at all, it must consider the factors set out in section 3(1) of the 1975 Act and make a value judgment as to whether the provision made, or lack of provision, is unreasonable. The Court of Appeal provide guidance in this regard in Illot Mitson [2011] EWCA Civ 346 at paras 12-35,41-58, 79 and 88-98.
57. S2 of the Act gives the court powers to make orders. The factors that the Court is required to consider are set out in section 3(1) which provides as follows:

(1) Where an application is made for an order under section 2 of this Act, the court shall, in determining whether the disposition of the deceased's estate effected by his will or the law relating to intestacy, or the combination of his will and that law, is such as to make reasonable financial provision for the applicant and, if the court considers that reasonable financial provision has not been made, in determining whether and in what manner it shall exercise its powers under that section, have regard to the following matters, that is to say—

(a) the financial resources and financial needs which the applicant has or is likely to have in the foreseeable future;

(b) the financial resources and financial needs which any other applicant for an order under section 2 of this Act has or is likely to have in the foreseeable future;

(c) the financial resources and financial needs which any beneficiary of the estate of the deceased has or is likely to have in the foreseeable future;

(d) any obligations and responsibilities which the deceased had towards any applicant for an order under the said section 2 or towards any beneficiary of the estate of the deceased;

(e) the size and nature of the net estate of the deceased;

(f) any physical or mental disability of any applicant for an order under the said section 2 or any beneficiary of the estate of the deceased;

(g) any other matter, including the conduct of the applicant or any other person, which in the circumstances of the case the court may consider relevant."

In addition, in the case of an application by a person who claims that he was being maintained by the deceased, the court is required by section 3(4) to have regard to the extent to which, and the basis upon which, the deceased assumed responsibility for the maintenance of the applicant and to the length of time for which the deceased discharged that responsibility.

58. Mr King's claim is that he was receiving board and lodging from June and his living expenses were to some extent being met. In return he cared for his aunt for the years from 2007 until her death in 2011.
59. At the time he came to live with June, Mr King was renting a room from Mr Whitehead, for which Mr Whitehead deducted £600 per month from the takings of the business he was running with Mr King. The detailed examination of Mr King's bank statements which was carried out with Mr King in cross-exam broadly revealed the following: (1) Mr King's income from the business being carried on with Mr Whitehead does not seem to have been very significant (2) during the year from mid-2007 when he was winding down the business he says he received almost £8000; it is difficult to see precise figures but it must have been in that region (3) thereafter he was dependent on June for money, she gave him relatively small sums as well as paying for his board and lodging and any expenses he incurred (4) he made a little money from odd jobs, for Ms Walker and possibly others but these were one-off payments and were not very significant (5) since June's death Mr King has lived in the Property. The valuer regards it as uninhabitable but Mr King nevertheless lives there (6) he has lived off loans from friends of small sums, the sale of some personal items (7) he has had a loan of £35000 from a friend to enable him to fight this case (8) he does not have a job and has no private pension.

The 1975 Act: the law

60. Where a person provides care in return for board and lodging and pocket money, it could be argued that there is a balance struck and there is no element of dependency. But the approach of the courts has been more pragmatic. The leading case is Jelley v Iliffe [1981] Fam 128. I shall cite this decision at some length because it provides helpful insight in how to assess whether there is dependency when each party is providing services or money's worth to the other. Stephenson LJ said in relation to the 1975 Act:

" Its object is surely to remedy, wherever reasonably possible, the injustice of one, who has been put by a deceased person in a position of dependency upon him, being deprived of any financial support, either by accident or by design of the deceased, after his death. To leave a dependant, to whom no legal or moral obligation is owed, unprovided for after death may not entitle the dependant to much, or indeed any, financial provision in all the circumstances, but he is not disentitled from applying for such provision if he can prove that the deceased by his conduct made him dependent upon the deceased for maintenance, whether intentionally or not.

Accordingly, I am of opinion that the court has to consider whether the deceased, otherwise than for valuable consideration (and irrespective of the existence of any contract), was in fact making a substantial contribution in money or money's worth towards the reasonable needs of the plaintiff, on a settled basis or arrangement which either was still in force immediately before the deceased's death or would have lasted until her death but for the approach of death and the consequent inability of either party to continue to carry out the arrangement.

He went on:

"I have no doubt that the provision of free accommodation in these times is a substantial contribution to the needs of the accommodated and was a substantial contribution to the plaintiff's reasonable needs. If in describing the deceased as one who "happens to own the house in which they live" the judge intended to treat that as an accidental and therefore insignificant circumstance, I cannot agree with him. It might qualify the plaintiff to pursue his claim because the pooling of their incomes and the remaining contributions of aid and comfort which each gave to the other cancelled out. In my judgment the statute, whether literally or purposively construed, requires the court to take a broad common sense view of the question whether the applicant for the statutory relief was a dependant of the deceased before death, and the ordinary man's answer to what, on this approach, is the right question, "Was this man dependent on this woman during her lifetime for maintenance, or did he give as good as he got?" might be (without regard to nice differences between the facts in this and other cases) that each was partly dependent on the other and he gave her, in companionship (whether or not it amounted to consortium) and help in money, and in furnishing her house and caring for her and her house and garden, as much as she gave him in companionship and rent-free accommodation and money and looking after him by cooking and cleaning.

I do not, therefore, agree with the judge that the plaintiff was the one who had been making substantial contributions, if by that he meant that the plaintiff was the only one. Nor would I accept that the deceased's provision of rent-free accommodation was insignificant in relation to those acts of his. I find here, unlike the judge, maintenance in money and money's worth for a long time and an assumption of responsibility for such maintenance by the deceased to a considerable extent and on a settled basis. But I do not think her intention to continue such maintenance until his death (as the judge is noted as saying), or his awareness (or ignorance) that such was not her intention, is relevant to the question whether he qualifies for any financial provision after her death, and I find also that the plaintiff was helping to maintain her by his contributions financially and otherwise and so giving some valuable consideration for her contribution to their life together. "

61. Griffiths LJ said at 141 :

"Section 1 (3) requires the court to balance the benefits received by the applicant from the deceased against those provided by the applicant to the deceased. In striking the balance the phrase "for full valuable consideration" is not to be construed as being limited to benefits provided under a contract. Only if the balance comes down heavily in favour of the applicant will it be shown that the deceased was ''making a substantial contribution in money or money's worth towards the reasonable needs" of the applicant. In striking this balance the court must use common sense and remember that the object of Parliament in creating this extra class of persons who may claim benefit from an estate was to provide relief for persons of whom it could truly be said that they were wholly or partially dependent on the deceased. It cannot be an exact exercise of evaluating services in pounds and pence. By way of example if a man was living with a woman as his wife providing the house and all the money for their living expenses she would clearly be dependent upon him, and it would not be right to deprive her of her claim by arguing that she was in fact performing the services that a housekeeper would perform and it would cost more to employ a housekeeper than was spent on her and indeed perhaps more than the deceased had available to spend upon her. Each case will have to be looked at carefully on its own facts to see whether common sense leads to the conclusion that the applicant can fairly be regarded as a dependant."

See also Ross, Inheritance Act claims 3^rd ed 6-177 ff, Bishop v Plumley [1991] 1 All ER 236

62. Thus I am required to consider, on the basis set out by the Court of Appeal, whether Mr King was a dependant of June. In considering the balance to be struck in this regard between the care provided by Mr King in return for board and lodging and some limited sums of money, the last lines cited of Griffiths LJ are particularly instructive. This approach makes sense: were it otherwise an ineffective carer who did little work would be in a better position under the 1975 Act than a carer who did an outstanding job and worked long hours.
63. In relation to the 1975 Act claim I find as follows (1) Mr King moved into June's house in 2007. The purpose of moving in was to care for her, and he did so until she died (2) in return for the care, he was receiving board and lodging , expenses and small sums of money (3) that followed a settled pattern and involved assumptions of responsibility on both sides-on June's side for maintaining Mr King and on Mr King's side for looking after June (4) Mr King did not work during the period when he was caring for June, with very modest exceptions, nor realistically could he do so (5) since June died, Mr King has not worked and has not been able to maintain himself (6) whilst one might say that there was a balance to be struck between Mr King's services as a carer and the board, lodging and money he received from June, so that there was no dependency, adopting the approach in Jelley v Iliffe, I do not think such an approach would be correct. The realistic analysis is that there was maintenance in money and money's worth for a lengthy period and an assumption of responsibility for such maintenance by the deceased to a considerable extent and on a settled basis. (7) the evidence of the failed wills seems to me that June accepted that she had assumed a responsibility for Mr King.
64. I find that Mr King falls within s1(1)(e) of the 1975 Act and that June otherwise than for full valuable consideration was making a substantial contribution in money or money's worth towards the reasonable needs of that person.
65. It is common ground that the section 3 factors must be considered, first, in deciding whether the disposition effected by a will is such as to make reasonable provision for the applicant and, if the answer to that question is 'no', when deciding whether, and in what manner, to make further provision. Mr King is to recover £3000 under the Will as his father's only heir if he loses on the DMC claim. I find the answer to the first question is "no".
66. In assessing the s3 factors I have in mind the following: (1) the benefit in money's worth received by Mr King was relatively modest: he used a room in the Property and had his food and expenses paid plus small amounts of money (2) although I have found that there was an assumption of responsibility and it followed a settled pattern, it is right to have in mind that the maintenance had only lasted four years at the time of June's death, which is a factor stated to be relevant by s3(4) (3) it was suggested by counsel for Mr King that an appropriate award might be enough money to enable him to purchase a small flat in the area, which could cost £100- 150,000 (4) in view of the above, I think that is a greater sum than is justified by s3

(4) Mr King needs money to live; he has no income and limited prospects and if he does not succeed to the Property he has no accommodation (6) there is no other applicant under the 1975 Act (7) the sole significant asset in the estate is the Property, recently valued at £350,000 (8) it is not suggested the Charities have "financial needs" which can be assessed (9) I do not consider (b)(c )(f) or (g) are relevant.

67. In all the circumstances, if Mr King had not succeeded on the DMC claim I would have awarded him a lump sum of £75,000. Mr King is 58, is unlikely to get much further employment, and has no significant assets or home apart from the Property. But a greater lump sum would in my view overstate the dependency under the 1975 Act and, for this purpose, constitute a windfall

Disposition

68. I find for Mr King on the DMC claim. If I am wrong on that I award him a lump sum payment of £75,000 under the Act.

Note 1    Section 1(2)(b) I(PFD)A 1975.    [Back]

Note 2    Re Dennis [1981] 2 All ER 140,145 per Browne-Wilkinson J.    [Back]