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Divorce settlements and the Inheritance Act collide - Sismey v Salandron [2021]

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Divorce settlements and the Inheritance Act collide - Sismey v Salandron [2021]

Divorce settlements and the Inheritance Act collide - Sismey v Salandron [2021]

The Inheritance (Provision for Family & Dependants) Act 1975 (“the 1975 Act”) enables certain categories of people to make a claim that they are entitled to reasonable financial provision from a deceased’s estate.

The case of Sismey and Salandron is the first time that Section 11 of the 1975 Act has ever been tested to trial.

Section 11 is intended to limit a testator’s ability to make contractual agreements leaving a legacy to another person to defeat the reasonable financial provision clauses of the 1975 Act.

In or around 2017, John Sismey (J) and his third wife Shelia (S) divorced on terms that the matrimonial home in J’s name would be left to their only son Thomas (T) on J’s death. The divorce settlement that they entered into was approved by the Family Court by an Order made in 2017. Subsequently J made a Will as per the Order leaving the property to T. At the time, J’s partner Marissa (M) signed the divorce settlement to show she was aware of its contents.

In 2019, following a terminal diagnosis, J married M so that M would be able to receive the widow’s benefit of J’s pension post-death. The consequence of the marriage between M and J was that it revoked J’s earlier Will and M became the sole beneficiary of J’s estate.

T claimed against J’s estate for breach of the 2017 divorce settlement. This in turn, sparked a counter claim from M under Section 11 of the 1975 Act for an Order that, notwithstanding the divorce settlement of which she has been aware, the property should be used to make reasonable financial provision for M.

The Court concluded that the son’s claim should be upheld and M’s claim was rejected. It was also found that there had been “collusion” between J and S and there was a potential to overturn the divorce settlement as unfair. However, the Judge upheld the settlement because J had received full valuable consideration for the divorce settlement as it had bought off the risk of a pension sharing Order. Therefore, the property was held on trust for T and M’s claim under Section 11 was dismissed.

This case brings uncertainty on the value of reaching a settlement in divorce on terms that a property is to be left by a Will. It shows the complex interaction between financial arrangements on divorce and the position on death.

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For more information on this update please contact Karen Young.

This article was prepared by Claudia Pert.