The Scottish Government recently published the outcome of its Consultation on the law of succession. The Consultation considered recommendations which had been made by the Scottish Law Commission on changes to substantive succession law dealing with three key areas: Intestacy, Disinheritance & Cohabitation.
The law of intestacy covers the distribution of estate when there is no Will, or where a Will does not dispose of all of a deceased person’s possessions.
The Commission had criticised the current law because of its ‘complexity’ and because the distribution of the estate could vary dramatically depending on the type of assets in the estate. They had proposed a new method for distributing an intestate estate among beneficiaries.
Their first suggestion was that, where there a deceased person is survived by either a spouse or by descendants then the spouse or the descendants would be entitled to receive the whole estate. The Consultation responses to this proposal were uncontroversial, and the Government noted its intention to introduce this provision in future legislation.
The remainder of the Commission’s proposed scheme provided for the distribution of the estate where a deceased person is survived by both a spouse and children. The Government’s Consultation found that the public held widely divergent views on how an intestate estate should be divided in these circumstances. The Government’s view is that any default intestacy rules should be based on consensus. In the absence of agreement, the Government will not introduce these provisions until further Consultation has been carried out.
One feature of the current Scots law of Succession is that the surviving spouse and descendants of a deceased person enjoy legal protections against being disinherited.
This protection is referred to as “legal rights”, and applies to succession of a deceased’s moveable estate. The current system was criticised by the Commission as being flawed, as there are certain planning opportunities which are available to prevent or minimise a legal rights claim.
As with intestate succession, there was little consensus on whether a surviving spouse or children should continue to receive protection from disinheritance and, if they should, the level of protection which should be provided. Although the current system has been criticised, the Government noted that it attempted to strike a balance between protecting a spouse and children and enabling a person to dispose of their estate as they wish. Based on the lack of consensus, the Government do not propose to bring forward reforms in the area.
Currently, a surviving cohabitant can apply to the court for provision from the estate where the deceased died intestate. The application to the court must be made within six months of the death of the deceased cohabitant.
The current system of providing for a surviving cohabitant, and particularly the time limit for applying, has received significant criticism since its introduction in 2006. The Commission recommend the introduction of a new process for establishing cohabitant’s rights.
The proposed process would identify whether a couple was “cohabiting”, and then assess the “quality” of the cohabitation to identify what provision should be made. The Consultation proposed various assessment criteria for making the assessment. There was no clear consensus on amending the process, and the criteria which would be used.
There was consensus on extending the six month time limit to one year, and the Government indicated its support on this point. The Government considered, however, that it is an appropriate time to consult on a change of approach in relation to cohabitants rights, and so it is likely that any extension to the time limit will be incorporated into changes made following this Consultation.
A cohabitant can only apply for provision where the deceased cohabitant died intestate. The Government consulted on whether a cohabitant should be able to claim where the deceased left a Will which excluded them. A significant proportion of respondents believed that they such a claim should not be allowed, and the Government indicated that it does not propose to bring forward any reforms for the time being.
Although many areas of Scots succession law are subject to criticism, the Consultation highlights the lack of consensus in many proposed areas of reform.
In areas where opinions are sharply divided, such as in the area of protection from disinheritance, it is unlikely that any Government will wish to make reforms until support can be identified.
As a result of this, and with the Government’s comments on cohabitants’ rights, we should expect further Consultation before any significant overhaul of the law of Succession takes place.