The problems which can arise when there is an intestate estate that involves business assets were made clear recently when the High Court had to rule on a complex claim relating back to a death that occurred many years ago.
At stake was a share in a farm, claimed by the children of a woman who died in 1993 without leaving a will. Her estate had been valued at a figure which meant that it passed to her husband under the rules of intestacy. Had the valuation been greater, a formal account would have been necessary and some of the woman’s estate would have been distributed amongst her family. However, at the valuation put on the farm, the whole of her estate passed to her husband.
The woman’s husband died in 2005, leaving a will which passed the farm to one of his sons. The son who inherited it claimed that it had passed beneficially to his father on the woman’s death. Her family went to court to challenge the administration of the estate. In question were:
- the validity of the will made by the intestate woman’s late husband;
- the ownership of the farm; and
- whether the woman’s estate was undervalued so as to allow the son to take the whole of the estate.
The Court upheld all of the challenges.
Click here for information on the Intestacy rules.