Where There’s A Will:The dangers of home-made wills

A home-made Will is an opportunity for lawyers to profit from mistakes.

With the cost of a straightforward Will being less than £500.00 in most cases.  It is surprising that more people do not have proper Wills drafted.  Preparing a Will and making sure it is correctly signed is a minefield for the inexperienced.  Even when the basics are mastered looking at a family situation from a very narrow viewpoint means that not all necessary steps are taken to ensure that the Will can be carried into effect.

Take the case of a spouse who does not want to leave their interest in the property in which they live to the survivor.  This may be for good tax planning reasons to maximise the opportunity of the transaction being a potentially exempt transfer.  The Private Client team at Anthony Gold came across a case recently where a parent wished to leave their interest in their property to their son.   It was a home-made Will.   Although the Will was correctly drawn and executed unfortunately, the parent overlooked the fact that his home was held by the Testator (the maker of the will) and spouse as joint tenants.

Joint Property ownership

Jointly owned property can be held in two ways. Perhaps the most common way is as  joint tenants in which case neither person’s share is defined but they are treated as owning the whole property together.   On death of the first to die their share in the property will pass to the survivor automatically.

The other alternative is a tenancy in common.  With a tenancy in common, it is possible to specify the shares in which you hold the property.   A tenancy in common also means you are free to leave your share of the property to whomsoever you wish.   This could be another family member for example.

In the case in point, if the joint tenancy had been converted or “severed” the testator would have been able to leave his share of the property to his son as he had wished.   In the circumstances of this case unfortunately that did not happen.

How can a joint tenancy be severed?

1. An express act – i.e. a Notice of Severance
2. Mutual agreement – i.e. a Declaration of Trust or;
3. A course of dealing

The severance should be noted at the land registry by entry of a joint proprietorship restriction.

This problem was considered in the case of Carr v Isard (2006 EWHC 2095)  which concerned a series of Wills by a couple who had been joint tenants.   The question was whether the Wills had severed the joint tenancy in which case different beneficiaries would receive the property.  Unfortunately, the starting point is that Will that tries to dispose of a share in a joint tenancy property will not, by itself, be sufficient to sever the joint tenancy.   (NB: only if there were Mutual Wills (these are wills which go beyond being mirror image wills and  are rare) by both owners would there by severance).   Therefore simply leaving the property or part of it in a Will does not amount to a severance and such a  Will ordinarily is not an express act or evidence of a mutual agreement.

In the Carr case there was no act of severance and on the death of the first of the joint tenants, his share passed to the other joint tenants and on her death it passed to her beneficiaries.

The motto of this is when making a will check how any jointly owned property is held. If a property is owned as joint tenants and you intend to leave your share to someone other than the other joint owner then sever the joint tenancy, record it at the Land Registry and ensure your will is correctly drawn.

* Disclaimer: The information on the Anthony Gold website is for general information only and reflects the position at the date of publication. It does not constitute legal advice and should not be treated as such. It is provided without any representations or warranties, express or implied.*