Whilst legacies and gifts in wills have always been important to charities, as a result of the COVID-19 pandemic maybe now, more than ever, legacies represent a lifeline.
The lockdown has meant many income streams for charities dried up overnight as retail shops closed and large scale fundraising events were cancelled. For many small charities the only income they received during this period was from legacies – they literally kept the lights on! That is why gifts in wills are so vital to allow charities to carry on the good work that they do.
For many potential donors who are now facing their own financial hardships and uncertainties, it may simply not be possible for them to make regular donations or gifts during their lifetime, even though they would like to help a charity, particularly one which they have a connection or affinity with. Leaving a gift in a will is still a way that a person can support that charity after their death.
Make sure your wishes are upheld
It is important that having made the decision to make a will and benefit a charity, that a donor’s wishes are upheld. Unfortunately, the rules on making a will are strict and if not followed properly, then the will is not valid and the gift fails. This often doesn’t come to light until after a person has died and by then it’s too late to rectify. It can also happen that disappointed family members may also try to challenge the validity of a will after a person’s death, or bring a claim against the estate for financial provision.
With an aging population and family relationships getting ever more complex, we have seen a steady increase in claims relating to wills and estates. We expect this trend to continue especially for wills made during the current pandemic. If a will challenge is successful, the will is overturned and the important gift meant for the charity never reaches them. Even if the claim is unsuccessful, it will have caused delay and stress and the charity is still likely to have used up some (if not all) of the value of the gift in legal fees.
Whilst it’s not possible for an individual to completely safeguard their legacy and prevent claims being made, there are some steps which they can take to reduce the risks.
Use a solicitor
These days a will can be downloaded from the internet for less than the cost of a large family pizza and while the technology offers speed and ease and may save some money in the short term – it can often simply be false economy. No independent advice is given about the terms of the will and no one is checking the donor’s capacity. And there is often that suspicion that the person sat behind the laptop completing the will form is not actually the 80 year old donor themselves but rather someone else. Charities may inadvertently find themselves caught up in such issues and they risk losing the gift over the perceptions and suspicions of disappointed family members.
Therefore, donors who wish to leave legacies to charities are encouraged to use a solicitor or professional will writer to prepare their will as:
- The solicitor can ensure that the donor’s wishes are followed properly and recorded, particularly their reasons for making the legacy to the charity if it is to the detriment of other family members.
- The solicitor can ensure that the will is validly executed (many wills are invalid because they aren’t witnessed properly)
- The solicitor should satisfy themselves that the donor has capacity to make the will and to advise the donor to get a medical report if capacity is in doubt.
If a claim is made against the estate, then the solicitor’s will file will contain crucial evidence and the solicitor who prepared the will can be a key witness.
Donors should communicate with their family and be open about their testamentary wishes either speaking to them during their lifetime or leaving a letter of wishes with their will setting out their reasons. Some family members simply cannot accept that their parent/relative didn’t want them to inherit and are immediately suspicious of any will which doesn’t align with their expectations, even if there is no real grounds to contest it. If the donor has had “the conversation” with their family and addressed concerns during their lifetime or else left a note detailing their reasons, then that makes it less likely a claim will be made against the estate.
When the terms of the will become known, charities should be encouraged to liaise with the donor’s family members in a timely and sensitive manner– explaining the good work that the charity does, how the legacy will be used and how the legacy is not a windfall for the charity, but helps keep the charity operating.
The charity can also use this opportunity to address the often held mistaken belief that the charity is free to give the money back to the family if they really wanted to. Many people simply don’t know that the charity is legally obliged to only use legacies for its charitable purposes and only in very specific circumstances is it free to depart from that.
As legacy giving is on the increase, so are disputes so it’s always important that if a charity is faced with a challenge to a will or a claim against an estate, that they take their own specialist legal advice.
No matter where you are on your journey, we can help to support and guide you through the process. For further information on will-making and legacy giving please contact Debra Burton, Anne Tromans or a member of our charities team.
Our free legal helpline also offers bespoke guidance on a range of subjects, with a team of experts on hand for any queries relating to personal and family matters. Available from 10am-12pm Monday to Friday, call 0800 689 4064.
The uncertainty of what’s to come as a result of the COVID-19 pandemic is understandably keeping many people awake at night but, whilst the scope of what our future may look like is still evolving, one aspect that can be controlled is putting measures and provisions in place to plan for the future and protect the wealth of you and your family. Our guide to recovery and resilience highlights the opportunities currently out there for effective wealth planning that will make a real difference.