The Supreme Court handed down judgment in Ilott this morning and allowed the charities’ appeal – restoring the decision of the District Judge to award Mrs Ilott £50,000. Judgement in Ilott v The Blue Cross & Others [2017] UKSC 17 is available here.
In essence, the unanimous view (Lord Hughes giving judgment, with which the other Justices agreed) was that District Judge did not err in taking into account the estrangement between the parties and Mrs Ilott’s lack of expectation [35].
Further, the District Judge had not failed to take account of the impact upon means tested benefits [38]. Notwithstanding the impact upon means tested benefits, there was a real benefit to Mrs Ilott in the award of £50,000, which would enable her to purchase household goods and fund other domestic expenditure such as replacing furniture and carpets.
The need for that expenditure had formed part of Mrs Ilott’s case before the District Judge and she had made a strong case for the necessity of that sort of expenditure, which could properly be described as necessities for daily living [40].
Whilst the District Judge justified his award by reference to the provision of capitalised maintenance rather than expressly providing for that sort of expenditure, it could be used to provide for this sort of expenditure, which fell within the concept of maintenance, so as to put the household on a much sounder footing without for long retaining capital of over £16,000 that would disqualify the claimant for means tested benefits [41].
Interestingly, the justices all appeared to consider that it might have been legitimate to have made no provision at all [35] (see also Hale’s supplementary judgment at [65], with which Kerr and Wilson agreed).
Moreover, Lady Hale in her supplementary judgment [65] suggests that the district judge might have legitimately have made a range of orders including (1) making no provision, alternatively (2) providing for the property to be purchased for Mrs Ilott, as per the Court of Appeal decision (Lady Hale thought it might be more reasonable for this to be on the basis of a life interest and then for the capital to revert to the estate), or alternatively (3) making provision, as per the order he made, for a lump sum of capitalised maintenance.
Hale considered that the best choices were between (1) and (2) – either no order or the acquisition of the property (starkly different outcomes!), nonetheless the district judge’s decision should not be disturbed.
The decision rolls back the most difficult aspects of the decision of the Court of Appeal – that dependence on means tested benefits might increase a claimant’s needs and the failure to give due weight to the estrangement between Mrs Ilott and her mother and her mother’s testamentary wishes [45, 46].
I do consider that the decision – and particularly the indication that no provision might have been a reasonable outcome – will discourage some of the ‘less deserving’ adult claimants. However, it is also appears from the judgment that a broad range of outcomes would have been reasonable at first instance and unimpeachable on appeal.
As noted, Hale (albeit that this is a minority view) suggests that “a respectable case” could be made for the very different outcomes of no order, the purchase of a property, or a capital lump sum.
Hale concludes: “I have written this judgment only to demonstrate what, in my view, is the unsatisfactory state of the present law, giving as it does no guidance as to the factors to be taken into account in deciding whether an adult child is deserving or undeserving of reasonable maintenance.” I agree! The decision underscores the very broad discretion that court has in these cases and the difficulty for advisors of predicting the outcome.
The points of greatest importance for future cases, arising from the judgment, are the view that housing need, if it should be met by the estate, should be provided for by way of life interest (often not a particularly palatable option for either side if it precludes a clean break), and the view that the qualifying relationship plus financial need are not necessarily enough to justify provision and that ‘something more’ will be required (I predict that this point will vex future courts greatly).
The other point to flag from the decision, which is of significance from the perspective of preparing these sorts of cases on behalf of a claimant, is that the Supreme Court Justices also appeared to share the view that the very ambitious way in which the claimant’s case had been presented at first instance had not been helpful. The various schedules and calculations proposed for the claimant exceeded the value of the estate. From the perspective of running a case for a claimant, particularly in a case of this nature featuring an adult entitled to provision for maintenance only, the point to take away, in my view, is that running an unattractively ambitious and over inflated case may result in a situation where the ‘baby is thrown out with the bathwater’ and a judge ends up disregarding all of the budgets and schedules prepared and making an order of their own devising, which might be less generous than had the claimant pitched a more modest proposal.
