The Woodland Trust v Loring & Ors
2014
COURT OF APPEAL (CRIMINAL DIVISION)
United Kingdom
CORAM
- LORD JUSTICE LEWISON
- LORD JUSTICE CHRISTOPHER CLARKE
- SIR COLIN RIMER
Areas of Law
- Probate and Succession
- Tax Law
2014
COURT OF APPEAL (CRIMINAL DIVISION)
United Kingdom
CORAM
AI Generated Summary
This case is an appeal on the interpretation of clause 5 of Valerie Smith's will concerning the distribution of her residuary estate. The crux of the dispute was whether the nil-rate band for inheritance tax should be considered at the time of death or include any retrospective increase due to claims under section 8A of the Inheritance Tax Act 1984. The court upheld the lower court's decision favoring the Lorings, as the retrospective increase under a valid section 8A claim was to be included. The judgment emphasized the importance of considering a testator's intent and the legal implications of retrospective statutory provisions.
Judgment
Sir Colin Rimer :
Introduction
This appeal is against the order dated 28 November 2013 made by Asplin J in the Chancery Division by which she answered a question raised by Barrie and Terry Loring, the executors of the will of the late Valerie Smith, as to the correct construction of clause 5 of her will.
Clause 5 disposes of the testatrix’s residuary estate, of whom the beneficiaries are (i) the two executors and Debbie, Oliver and Alexander Loring, and (ii) the Woodland Trust, a charity that, as one might guess, is concerned with the conservation of woodland. The issue is as to the shares of the residuary estate to which the Lorings and the Trust are respectively entitled. The judge found in favour of the Lorings. The Trust asserts on this appeal that she fell into error in so deciding. Ms Reed QC and Mr Wilson represented the Trust and the Lorings respectively, both before us and below.
The will
The will is a professionally drawn, one and a half page document that was executed by the testatrix on 2 February 2001. Clause 1 appoints the executors, the two sons of the testatrix. Clause 2 declares her wish to be cremated. Clause 3 gives her personal effects to her two sons. Clause 4 provides that, subject as aforesaid and to the payment of her debts, her residuary estate is to be disposed of in accordance with clause 5. Clause 5 provides materially:
‘ MY TRUSTEES shall set aside out of my residuary estate assets or cash of an aggregate value equal to such sum as is at the date of my death the amount of my unused nil rate band for Inheritance Tax and … hold the same for such of the following as shall survive me and in the case of the grandchildren attain 23 and if more than one in equal shares absolutely.’
Clause 5 then lists the five Loring beneficiaries I have described in [2] above, of whom three are children and two are grandchildren of the testatrix and all of whom survived her. Clause 5 makes substitutional gifts in favour of the children of any of them who should predecease her, a provision that did not take effect. Clause 6 provides that, subject as aforesaid, the executors are to hold the remainder of the testatrix’s estate for the Trust.
The facts
The testatrix died on 1 September 2011. The executors proved her will on 13 December 2011. The net value of the estate is £680,805.
At the date of the testatrix’s death, the amount of her single unused nil-rate for inheritance tax purposes was that set out in Schedule 1 to the Inherit