I write as a tax adviser, rather than a lawyer so please excuse my lack of legal expertise.
The deceased (A) created a will trust over his property with a life interest for his retired son and with the remainder going to his grandchildren (GC). The son (B) is planning to move into the property with his younger second wife (W2) of a few years standing and the wife’s adult son (WS) who does not work.
It appears that the will trust was written to protect the interests of the grandchildren (GC), and there is no provision for the son’s wife (W2) or her son (WS).
I can envisage a scenario in some years’ time when the son (B) has died and the trustees wish to obtain possession of the property for the residuary beneficiaries (GC). The wife (W2) and / or her son (WS) may not wish to leave.
What rights might the wife (W2) and / or her son (WS) have acquired over the property? It appears to me that they would not have any rights under the Inheritance (Provision for Family and Dependants) Act 1976 as the property would be governed by the will trust which arose from the will of A and not B. Presumably it would only be B who would be considered to have an obligation to provide for his wife and possibly the wife’s son (WS). Are there other rights that they might have obtained, eg housing rights, protection from eviction rights?
What steps should the trustees take now to make life easier later on? Is it customary for trustees to ask non-beneficiaries to sign a licence before occupation of a trust property? What type of terms would it contain?
One useful piece of information that my researches has identified is that trustees are subject to checking the “right to rent” of all occupiers, and this would include B, W2 and WS. This might be a good starting point for requiring some documentation from all three future occupants.
Thank you for your help. When I have more understanding I will be encouraging the trustees to obtain legal advice to put in place suitable documents to protect the interests of the beneficiaries and the trustees.
Jane Evans Taxation Limited