Tackling financial abuse within Wills

Tackling financial abuse within Wills

With an increasing ageing population, financial abuse is depressingly common. Sometimes it is picked up during the victim’s lifetime and, if they lack capacity, the Court of Protection may become involved. However, often financial abuse is not picked up until someone has died.

Financial abuse usually involves a weak and vulnerable individual who is a risk owing to poor physical and mental health, dependency on another person, a long history of poor family relationships, relatives having limited time due to work commitments, social isolation and/or lack of funds to pay for care.

The abuse can take many forms and includes having money or other property stolen, being defrauded, put under pressure to give away assets or gifts or to change a Will, having money or other property misused and even predatory marriages. Often controlling or coercive behaviour or violence can take place alongside in the form of depriving a person of their basic needs, limiting their access to their finances, or denying them access to support or medical services.

As a specialist in trust and probate disputes, I usually come across allegations of financial abuse in the following context:

  1. During the lifetime of the victim of the abuse to dispute the validity of a lifetime gift of cash or other property
  2. Post the death of the victim to:
  • dispute the validity of lifetime transactions involving the deceased’s assets whose effect is to significantly reduce or extinguish the value of their estate; and/or
  • dispute the validity of their Will

If the abuse has been carried out by the administrator of the deceased’s estate, a feature of a dispute is likely to include action to remove that person(s) from their role as estate administrator.

Key questions that arise in any dispute is whether the victim had capacity to manage their property and affairs and/or whether the transactions involving their assets were procured by means of undue influence.

Expert medical opinion evidence is important when trying to establish a lack of capacity on the part of the alleged victim of financial abuse. Often that will be a retrospective opinion if the victim has died, based on a review of the deceased’s medical records.

However, positive evidence of undue influence is rare. In most cases, direct evidence does not exist, and an inference must be drawn from other proven facts. It is necessary to weave a complex tapestry of evidence, but the more the circumstantial evidence is strong and aligned in one direction, the less likely it is that the court will be as exacting in requiring direct evidence of undue influence or the precise mechanism by which undue influence was brought to bear.

Key indicia of undue influence commonly include the following:

  • The perpetrator saw an opportunity and had an opportunity to exercise undue influence
  • They were motivated by previous family history to seize the opportunity and greed
  • They became hugely interested in the victim’s property and financial affairs
  • The victim was dependent upon the perpetrator
  • The perpetrator has a domineering character
  • They acted as a gatekeeper to communications with the victim
  • They poisoned the victim’s mind against friends and family
  • The perpetrator’s character is one of a person who would engage in undue influence
  • There is no other reason that exists to explain the transaction in question or the Will of the victim
  • The victim was a weak and vulnerable person at the time
  • The victim made a Will which was a real departure from their previous Will making pattern

Solicitors are well placed to identify actual or possible financial abuse and therefore it is important that they understand their role in preventing it, identifying it and taking action on behalf of clients in the event of actual or suspected financial abuse in the course of their practice.

Accordingly, in July 2020, the Law Society published guidance aimed at solicitors who advise clients who are or may be at risk of financial abuse, in particular, those conducting private client work involving estate and financial planning, property transactions, execution of Wills or LPAs.

Early intervention is important whenever financial abuse is suspected or discovered. Too often financial abuse is not picked up until after the victim has died when evidentially it might be more difficult to unravel a lifetime transaction, or assets have been dissipated, not to mention the impact upon the victim during their lifetime.

John Lambe, Senior Associate, Forbes Solicitors

John is the senior member of the firm's Contentious Trusts and Probate team at Forbes Solicitors. John is an experienced probate litigation solicitor and has a proven track record of successfully resolving disputes. Designated a "rising star" by the Legal 500.

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