Testamentary freedom and administering an estate in the United Kingdom and the Crown Dependencies – an overview

An overview of testamentary freedom and administering an estate in the United Kingdom and the Crown Dependencies.

Testamentary freedom

In many countries and in particular in civil law jurisdictions in Central or South America, Central or Eastern Europe and East Asia, a prescribed portion of one’s estate must pass to a spouse or descendants on death. In the United Kingdom, this is commonly referred to as ‘forced heirship rules’.

Conversely, succession law in England and Wales follows the common law principle of ‘testamentary freedom’. This means that testators in England and Wales are free to leave their assets as they wish. As an example, someone could choose to leave their estate to their close friends and preferred charity rather than to their estranged family. This principle of testamentary freedom also applies in Scotland and Northern Ireland.

However, in England and Wales the principle of testamentary freedom is not absolute and legislation allows certain individuals to bring a claim against an estate. To be successful, the claimant must show that reasonable financial provision has not been made for them or that they were financially dependent on the deceased. The merits of such claims are decided at the discretion of the court, but generally this route is open to disinherited spouses or children.

One common error is to consider offshore islands such as Jersey, Guernsey and the Isle of Man as being within the same jurisdiction as England and Wales. In fact these have their own legal systems and separate courts. Succession law in each of these jurisdictions can vary considerably from England and Wales, and indeed from each other.

Broadly speaking, Jersey law distinguishes between immovable assets (such as property) to which testamentary freedom can apply and movable assets (such as cash and shares) which can be subject to forced heirship rules known as légitime.

Guernsey applied forced heirship rules until 1 April 2012 when a greater element of testamentary freedom was introduced. Different rules apply depending on the date of the Will,  types of asset and whether the deceased’s permanent home or ‘domicile’ was Guernsey or elsewhere.

No forced heirship rules apply in the Isle of Man.

Administering an estate

Similarly, different rules apply to transfer assets to the beneficiaries of an estate depending on the jurisdiction in which the assets are located. A grant of probate is typically required before an executor can administer the estate in accordance with the Will.

Grants of probate issued by countries that follow the common law can typically be re-sealed in England and Wales to allow executors to deal with the assets. This is far simpler than having to apply for a new grant of probate. However, a grant of probate in a foreign language cannot be re-sealed.

If the grant of probate or equivalent document has been issued in a civil law jurisdiction, a separate grant of probate will be required to deal with the assets in England and Wales. This requires an application to the Probate Registry and the payment of court fees, as well as payment of any UK inheritance tax.

The processes are similar in Scotland and Northern Ireland, the primary differences being that in Scotland the grant is known as the ‘confirmation’ and neither jurisdiction will re-seal a grant issued in a common law country.

To reiterate, the systems in Jersey, Guernsey and the Isle of Man can vary significantly and advice from experts in the applicable jurisdiction should be obtained. Each has its own rules on whether foreign grants will be recognised and a designated institution to which probate applications are made.

For example, in Guernsey applications are dealt with by the Ecclesiastical Court, and fees are, relatively speaking, lower. Also, as a consequence of its location and history, grants obtained in France can be fast-tracked and re-admitted to probate in Guernsey, alongside those obtained in the jurisdictions of the UK.

Jersey also has a fast-track procedure for grants obtained in the UK, Guernsey or the Isle of Man, but not those issued in France. Applications are dealt with by the Royal Courts of Justice at the Judicial Greffe in St Helier and, importantly, the application must be made by the executor in person or by an attorney resident on the island. In addition, the fees set by the Courts of Justice for the application can be significant, possibly as much as £100,000.

In contrast, courts on the Isle of Man do not recognise grants of probate made in another jurisdiction and require anyone seeking to administer assets located there to have an address for service within its borders, as grants will not be sent outside the island.

Our legal team specialises in the administration of estates in England and Wales and have contacts throughout the Crown Dependencies who can help you to administer an estate in any of these jurisdictions.