Whilst the power to add the housekeeper is in the will, to which she was a witness, her addition as a beneficiary will be in a separate document and subject to the exercise of the trustees’ discretion.
I understand that the primary reason a witness to a will cannot benefit under that will is to reduce the possibility of them exerting undue influence the testator. If there is a codicil including them as a beneficiary, that entitlement is not affected by them having witnessed the will.
Whilst a witness to the will could exert undue influence over the terms of any subsequent codicil, it is for anyone seeking to exclude that witness from benefiting to establish they had exercised undue influence, which is a high barrier to cross.
I am inclined to the view that the letter of wishes should be treated similarly to a codicil in this instance, and it is for the trustees to exercise their discretion as to whether or not to add her as an object of the trust having considered the relevant circumstances.
If, during the testator’s lifetime, the housekeeper can be shown to have had an overbearing personality, this might be significant, but would be but one factor to inform the trustees’ decision.