Estates – Mutual wills – Validity

Angela Marilyn Charles (2) Derek Goddard (3) Anne Mabel Thompson v Jill Deborah Fraser: ChD (Jonathan Gaunt QC): 11 August 2010

The claimants (C) challenged the validity of a will made by the deceased (E) in 2006 under which the defendant (F) was the sole beneficiary.

In 1991, when E was aged 76 and her sister (M) was aged 78, they had made wills in which they bequeathed their estate to each other. Both wills provided that where one sister did not survive the other, then the subsequent clauses of the will should take effect in lieu of the previous bequest. Each will then named executors and trustees and devised and bequeathed all the residue of each testatrix’s real and personal estate to her trustees upon trust to convert the same into money and divide the proceeds into 40 shares to be divided between 15 named beneficiaries in specified shares. C, who were relatives of E and M, were among the named beneficiaries under that will. M died in 1995.

In 2003, E altered her will to add two individuals, including F, as beneficiaries, each entitled to shares under the earlier will, and altering allocation of the other shares. In September 2006, when aged 92, E indicated to her solicitor an intention to make a new will by which she would leave her estate to people who had been good to her, and she named F as such a person. The solicitor prepared a short new will whereby E revoked all former wills, appointed F as her sole executrix and bequeathed the whole of her real and personal estate to F. E died in November 2006 and F acquired over £300,000 under the terms of the 2006 will. She used some of those proceeds in the purchase of a property. C’s solicitors later wrote to F asking her to take no further steps to distribute or wind up E’s estate until they had completed enquiries. C subsequently informed F that, because M and E’s wills had been mutual wills, E’s estate fell to be distributed in accordance with her 1991 will, and they called on F to refund the net estate for distribution among the beneficiaries there named. F declined to do so, and C brought a claim on behalf of all the beneficiaries under the 1991 will.

It fell to be determined whether the court could be satisfied from the evidence as a whole that E and M had intended to distribute their estate in a particular way and that that agreement was intended to be irrevocable. C contended that, taking the evidence as a whole, the terms of the wills, the surrounding circumstances, the close relationship between the sisters and the evidence of number of witnesses, there was the strongest evidence of an agreement not to revoke in the absence of a contemporary document evidencing it.

F submitted that the fact that E had made a new will in 2003 clearly showed that she had not regarded herself as having made an agreement not to alter or revoke her will after M’s death. F did not place any reliance upon E having changed her will in 2006, having accepted that the evidence showed that at that point she had become confused and her memory was failing her.

Held: (1) Mutual wills were wills made by two or more persons, usually in substantially the same terms and conferring reciprocal benefits, following an agreement between them to make such wills and not to revoke them without the consent of the other. For the doctrine to apply, there had to be what amounted to a contract between the two testators that both wills would be irrevocable and remain unaltered: a common intention, expectation or desire was not enough, Goodchild v Goodchild [1997] 1 WLR 1216 CA (Civ Div) followed. The agreement might be oral or in writing, incorporated into the will or proved by clear and satisfactory extraneous evidence, Goodchild followed and Cleaver (Deceased), Re [1981] 1 WLR 939 ChD applied. The agreement was enforced in equity by the imposition of a constructive trust on the property which was the subject matter of the agreement, Cleaver applied. The beneficiaries under the will that was not to be revoked might apply to the court for an order that the estate was held on trust to give effect to the provisions of the old will.

(2) The court found as a fact that there was an agreement between M and E in 1991 that (a) the first sister to die would inherit the estate of the other; (b) thereafter the cumulative estates would pass to 15 specific individuals in various shares on the death of the survivor; (c) in the event of any beneficiaries predeceasing the surviving sister, their shares would lapse and be taken by the remaining residuary legatees whose shares would be increased proportionately; (d) the respective wills were not to be altered after the death of the first of the sisters. Accordingly, C had established the requirements for mutual wills and F held the proceeds of E’s estate on trust to give effect to the provisions of E’s 1991 will.

Judgment for claimants.

Lynne Counsell (instructed by Clifton Ingram) for the claimants; Elissa Da Costa (instructed by Brett-Holt) for the defendant.