Case Study

Why Should I Make a Will?

Thursday 19th June 2008

  

Making a Will is something we all know we should do, but a recent survey conducted by the Scottish Consumer Council found that only 37% of respondents had a Will in place. With family structures becoming ever more complex and an increase in the number of cohabiting couples, having a Will in place to ensure that your family are protected in the event of your death has never been more important.

 

WHO SHOULD MAKE A WILL?

  • The simple answer to this is everyone! Changes in circumstance, e.g. the purchase of a new home may make people think about putting a Will in place. However, it is not just home owners and those with valuable assets who should make a Will - no matter how small or large your estate, having a Will in place is essential to ensure your wishes are met on death.
  • There are certain categories of people who should give particular consideration to making a Will:-

 

(i)    Cohabiting Couples - Although rights now exist for cohabiting couples, these are not automatic nor guaranteed. In order to share in the estate of a deceased cohabiting partner, the surviving partner would have to apply to the court. The court will then determine whether the surviving partner is entitled to any share, having regard to various considerations (e.g. length of relationship etc). This is a long and complicated process at what is already a difficult time. However, this regime applies only where the deceased person did not leave a Will. Therefore, if you wish to make specific provision for your cohabitee, or wish to exclude him/her you must have a Will in place.

 

(ii)   Parents - There are automatic rights of succession for children in Scotland, but these are second in priority to those of spouses. Under the law of intestate succession (where there is no Will in place), a spouse is entitled to the marital home (up to the value of £300,000 - where the value of the home exceeds this limit, they are not entitled to the property itself, but to its value up to £300,000) plus any furniture/furnishings in that home up to the value of £24,000. They are also entitled to the first £42,000 from the remainder of the deceased's estate where the deceased left children, or £75,000 where there were no children. The rights of a spouse (known as prior rights) are a first claim on the estate and come before those of children.

 

After prior rights have been fulfilled, the surviving spouse and any children are entitled to certain legal rights from the deceased's estate. The spouse is entitled to a further one third of the moveable estate (i.e. this excludes any land/buildings owned by the deceased, but includes such things as shareholdings, cash etc) where there are children, and to one half of the moveable estate where there are no children. Similarly, children are entitled to one third of the deceased's moveable estate where there is a surviving spouse, and to one half where there is no spouse.

 

Therefore, if you wish to make specific provision for your children and your spouse, this must be done in a Will as it may be that your moveable estate is not sufficient to meet both the prior and legal rights. If you have children, a Will is also essential to cover such practical matters as who would care for your children in the event of your death.

 

(ii)   Step-Parents - Under the present law, stepchildren have no automatic right of succession to a step-parent's estate. Therefore, if a person was to die intestate (without a Will) leaving step-children, these children would not be entitled to anything from their deceased step-parent's estate. At present, the only way to protect the interests of step-children is by making a Will.

 

  • WHAT IS THE COST INVOLVED?

One of the most popular reasons given in the Scottish Consumer Council's survey by those who did not have a Will, was that they did not want to incur the cost of solicitors' fees. However, if a person dies without a Will, the cost to their estate will end up being far greater than the cost of making a Will in the first place.

 

Where a person dies intestate, a court application is required to have an Executor appointed (referred to as an Executor-Dative). The court will require the Executor-Dative to have in place an insurance policy known as a Bond of Caution. Depending on the size of the estate, the premium for this policy can run into hundreds of pounds. On top of this, the administration of an intestate estate tends to be more complex and drawn out than that of a testate estate (where a Will is in place), potentially leading to increased legal fees, court expenses and outlays.

 

  • DO I NEED TO CHANGE MY WILL?

Once you have a Will in place, it is easy to become complacent and think that everything is in place to allow your wishes to be honoured in the event of your death. However, it is important that you review your Will on a regular basis to ensure that it is up-to-date and reflects your current circumstances. In many cases, a change in circumstance does not necessarily require an entirely new Will - the change could be dealt with in a Codicil (a formal addition to the original Will) or by way of an informal writing to be placed with your Will.

 

The above gives only a brief summary of why it is so important to have a Will in place. Please contact our Private Client Department should you wish further information - our staff are more than happy to assist should you wish to put a Will in place or review the terms of an existing Will.

 

  • Isabel Ewing (Partner) E-mail: iee@tcyoung.co.uk Direct Dial Telephone: 0141 225 2563
  • Lesley Hurst (Partner) E-mail: lah@tcyoung.co.uk Direct Dial Telephone: 0141 225 2579