Demystifying Will Formalities

135 year old law firm appoint Family Solicitor as Partner

A secret trust can be used to conceal the identity of the recipient of a legacy. An example would be in the testator’s will it might read ‘I leave £50,000 to John’. On the face of it, this may look like the Testator has left £50,000 to John. However, the Testator has secretly asked John to hold the £50,000 on trust for Simon. As the Will does not make any reference to the trust, no one would know that the £50,000 is being paid to Simon. This can cause problems, as the success of the gift depends on John acting honestly and passing the money onto Simon. There could be problems also if John dies before the Testator. A half secret trust is where the Will creates a trust, but it does not reveal any of the details of who the beneficiaries usually are. The Will would leave the gift to the trustees to hold on trust ‘for purposes already communicated to them’. The existence of these sorts of trusts can create further complications for executors when administrating an estate.  If you require further information please contact our Private Client department on hsamra@blackhams.com or telephone 0121 233 6916.

The fast-tracked Economic Crime (Transparency and Enforcement) Act 2022 received Royal Assent on 15th March 2022, creating a new public Register of Overseas Entities (the OE Register). UK entities already have an obligation to disclose their beneficial ownership information under the PSC (People with Significant Control) regime however, this new register will apply where the UK property is held by a non-UK legal entity. This register will capture any overseas entities who hold freehold titles or leasehold titles of longer than seven years in England and Wales (a Qualifying Estate). The register will document the name, address and start date of the person who is the beneficial owner as well as the nature of the person’s ownership. This information must then be updated every 12 months. The scope of a Qualifying Estate is wide-reaching. For any Qualifying Estate that has been acquired since 1999 and still owned by an overseas entity, then that entity will be required to register. Additionally, any property dealings post 28th February 2022 will require the overseas entity to be registered.  It is not yet clear when the register will be implemented but with the deadline for compliance six months from implementation, overseas entities that could be caught by the new legislation should assess their position immediately to ensure compliance. If you require further information please contact our Conveyancing department on rsnipe@blackhams.com or telephone 0121 233 6912.

In our Contested Probate department, we often come across a common area of contention which is the test for capacity when drafting a will. The legal test for testing ones testamentary capacity is set out in the case of Banks v Goodfellow [1870]. In this case, John Banks owned an estate of 15 cottages in the Lake District. Unfortunately, Mr Banks suffered from delusions and epilepsy and had spent time in an asylum. Most notably, Mr Banks believed he was being visited by devils and evil spirits and was being molested by a local man, Mr Alexander, even since Mr Alexander’s death Mr Banks still believed this. On 2 December 1863 Mr Banks made a new will leaving his estate to his niece. He sadly passed away two yeas later. Thereafter, another two years passed and Mr Bank’s niece also passed away. Her inheritance (inclusive of Mr Bank’s estate) passed to her half-brother who was no relative of Mr Banks. The son of Mr Bank’s half-brother contested the will to have his will set aside due to lack of capacity. However, it was ruled that these delusions posed no bearing on the content of his will and therefor he was deemed to have sufficient mental capacity and the will still stood. One element of the test that has derived from the will is the Testator must not be suffering from ‘any insane delusions’ or ‘disorder of the mind’. This test from 1870 is still upheld today as evidenced in the case of ‘Re Clitheroe’ in 2021.

Tenants’ break clauses, giving tenants the right to bring their lease to an end early are becoming increasingly common in commercial leases with the object of giving the tenant a degree of flexibility in relation to their rented premises. It is vital to get things right both when the break clause is being drafted before the lease is granted and when seeking to operate the break. From the tenants’ point of view any conditions attached to their ability to operate the break clause should be kept to an absolute minimum. Landlords will always insist that the rent (and probably other payments) due under the lease must be up to date and that possession of the premises is given up by the break date (which in practice means clearing the property completely) but other conditions such as compliance with all of the other tenant’s covenants in the lease (e.g. the covenant to keep in full repair) should be resisted by the tenant at the negotiation stage. Other considerations are whether the break opportunity is to be a one-off on a specific date or if it will be a “rolling break” which could be operated at any time after a certain date and the length of notice that must be given to the landlord.