Unlocking the Potential of Section 10 in the Inheritance Act 1975: A Case for Greater Utilization by Solicitors

Under-Utilised Power of Section 10 in Inheritance Disputes Highlighted by Recent Case

Tara McInnes, an associate in the Dispute Resolution team at a notable law firm, has shed light on the potent yet under-utilised powers granted by section 10 of the Inheritance Act 1975. This provision, she argues, could significantly impact inheritance disputes if employed more frequently by legal practitioners.

While it has become routine for solicitors to file claims under the Inheritance (Provision for Family & Dependants) Act 1975 on behalf of applicants, section 10 of the Act remains largely overlooked. This section empowers courts to annul gifts made by the deceased up to six years before their death if it’s proven that these gifts were intended to circumvent a claim under the Act.

The case of Ruanne Dellal v Guy Dellal & Ors [2015] EWCH 907 serves as a prime example of section 10’s effectiveness. It involved the estate of the late property magnate Jack Dellal, who left his entire fortune to his wife, Ruanne Dellal, amounting to £15.4 million—a fraction of the reported £400 million estate value. Despite already possessing assets worth £41 million, Ruanne sought additional provision under the Act, suspecting Jack had deliberately dispersed his wealth to preclude any claims.

Ruanne’s claim, which also invoked section 10 to reintegrate Jack’s gifts into the estate, faced opposition from Jack’s children and sister. The court’s decision to reject their application to strike out Ruanne’s claim underscores the necessity of thorough examination, including the disclosure of relevant documents, before a fair judgment can be made.

Mr Justice Mostyn’s insistence on disclosure highlights the critical role of evidence in substantiating claims of intentional asset disposal. The potential for a section 10 application to lead to an out-of-court settlement further illustrates the power it wields, as parties may be reluctant to fully disclose received assets, fearing the repercussions of a judgment in the claimant’s favour.

This landmark case underscores the importance for legal practitioners to consider the strategic use of section 10 in inheritance disputes, especially when there is a significant discrepancy between the probate value and the deceased’s reported wealth. It serves as a potent reminder of the law’s capacity to ensure fair provision for dependants and family members, even in the face of deliberate attempts to defeat such claims.