Karen Walsh: Be aware of Section 117 when drafting a will
Succession planning can often be a daunting task, especially when there is only one main asset in the estate, as in a family farm situation.
Where a farmer has a number of children, Section 117(1) of the Succession Act 1965 (“the 1965 Act”) should be considered, when drafting a will, and proper financial advice taken, if appropriate, to avoid any conflict in a family following the death of the parent farmer, the testator (the person who makes a will).
Questions concerning a person’s rights, whether there is a will or not, can give rise to much complexity, particularly given changes in recent years that have extended inheritance rights to both civil partners and cohabitants.
Sadly, many of the bitter inheritance disputes are the product of distrust and poor communication, born of a lack of appreciation for each party’s rights.
There may be an expectation, but there is no automatic entitlement of a child to inherit from their parent.
Section 117 does not create an obligation to leave something to each child.
S.117 (1) of the 1965 Act provides as follows:
“Where, on application by or on behalf of a child of a testator, the court is of the opinion that the testator has failed in his moral duty to make proper provision for the child in accordance with his means, whether by his will or otherwise, the court may order that such provision shall be made for the child out of the estate as the court thinks just.”
Before a court can interfere, there must be clear circumstances, and a positive failure in moral duty.
The Law Reform Commission (LRC) published a report in 2017 on s. 117 of the 1965 Act, but to date there has been no change to the legislation.
It recommended, among other things, that s. 117 should extend to intestacy (where a parent dies leaving no will) and also that s.117 should be amended by the removal of references to “moral duty” and should simply provide that a deceased parent has a duty to make “proper provision” for a child.
It should include a presumption that proper provision has been made for adult children, with specific exceptions.
Under the current law, where a parent dies intestate, the estate is distributed in accordance with specific fixed shares which are set out in the 1965 Act.
The courts may not vary these shares, even in cases of particular hardship, and under the current law, an application under s. 117 is not possible.
In the meantime, however, where a S.117 application is made, any determination is reached by a two-stage process:-
The court must decide whether the testator has failed in his moral duty to make provision for a child and
Only if so failed, the court will look to see what provision should be made for the child.
It is important to note that s. 117 applications only arise on a testate death (where there is a will), and where the dissatisfied child (the applicant in the court case) is a child of the testator.
Any order under a s. 117 application cannot affect the legal right share of a surviving spouse, or if the surviving spouse is also the parent of the applicant child, an order under s. 117 cannot affect a devise or a bequest to the surviving parent.
Where the entire estate of a testator is left to a surviving spouse who is a parent of the applicant child, an order under s.117 cannot be made.
Careful consideration must be made and proper legal advice taken before considering any such application.
