The best way to ensure that your affairs are in order when you die is to make a will. This allows you to carefully consider what you want and clearly set out your wishes. Unfortunately the reality is that not everyone makes a will and this can be for a number of reasons such as lack of time or not considering that their death could be imminent. As a result some people will make gifts or promises on their deathbed and there are occasions where a court will uphold promises of this nature. The technical term for a deathbed gift is a donatio mortis causa.
The recent case of Vallee v Birchwood (Re Bogusz Deceased) dealt with a deathbed gift.
Brief facts of the case
The claimant was the adopted daughter of the deceased. Shortly before he passed away she visited him and said that she would return again at Christmas. The deceased told her that he did not think that he would live for much longer and that he wanted her to have his house (which formed the bulk of the estate) when he died. He gave the claimant the title deeds and a key to the house.
Almost 3 months later the claimant was informed that her father had passed away and that he had not left a will. She instructed solicitors to contact the Treasury Solicitor to inform them that the property had been gifted to her by the deceased. The Treasury Solicitor rejected this claim and an advertisement was put out for other potential claimants to the estate.
A genealogist found that the deceased had a surviving brother. That brother applied for letters of administration (to allow him to deal with the estate) and at that point the claimant issued court proceedings seeking a declaration that a deathbed gift had been made to her.
The court made a declaration that such a gift had indeed been made and that the deceased’s brother was holding the property on trust for the daughter’s benefit. The deceased’s brother appealed the decision.
Dismissal of the brother’s appeal
The initial decision was correct. It was found that the essential conditions for a deathbed gift to operate are:
- The gift must be made in contemplation (although not necessarily in expectation) of impending death; and
- The gift must be made upon the condition that it will only become absolute when the donor dies; and
- There must be a delivery of the subject matter of the gift, which amounts to a “parting with dominion” and not merely parting with physical possession.
Although the deceased lived for almost 3 months after his promise, he had made the gift because he was afraid that he would not live to see his daughter again at Christmas. The crucial point was the motive for the gift. It was not relevant whether the deceased had good reason to anticipate death in the near future, but that he personally believed that his death was imminent.
One point which can cause particular difficulty in a claim of this nature is what form of document will satisfy the requirement for a delivery of the subject matter of the gift. Examples of documents which have been held to satisfy this test are: bank notes, a deposit passbook, bonds and certificates for building society shares. However examples of documents which have been held not to satisfy the test (and accordingly not to operate as a deathbed gift) are: certificates for railway stock and private savings bank books.
If a deathbed gift is successfully made it is treated as a lifetime gift which gives the donee absolute title if the donor dies. As the donee’s title becomes absolute upon the death of the donor, the property does not vest in the donor’s estate. However, such gifts can be taken into account as part of the estate if an application is made for financial provision under the Inheritance (Provision for Family and Dependents) Act 1975.
If you believe that you may be the recipient of a deathbed gift, or have any other enquiry in relation to a disputed estate, please do not hesitate to contact our Anna Sutcliffe for a no obligation free chat concerning your matter.