Case Summary

When Alexander and Barbara Moody got married, they were very much in love. They had found each other later in life and both had children from previous relationships. They were looking forward to setting up home together and their solicitor, Mr Laws of Laws & Co was only too happy to help them with the purchase of their house.

Mr Laws met with the happy couple to discuss their intended property purchase. At the consultation, Mr Laws explained that a “survivorship destination” could be inserted into the title, so that, if the worst were to happen and one of them were to die, the title would simply transfer to the surviving spouse. Mr Laws outlined that this clause wouldn’t require the couple to make specific Wills and it would operate regardless of whether there were Wills in place. He mentioned that the clause could help reduce any administration costs in the future and would be ‘less hassle’. Alexander and Barbara were happy with Mr Laws’ suggestion and instructed him to include the survivorship destination in the disposition.

The path of true love doesn’t always run smoothly and, a few years later, Alexander and Barbara separated, with Barbara moving out of the matrimonial home. Alexander engaged a family lawyer at Laws & Co. Barbara went elsewhere for legal advice. Things got messy and Alexander and Barbara could not agree a financial settlement. As time passed by without agreement, Alexander decided to change his will to make sure that his daughter, and not Barbara, would inherit his estate. He left everything, including his half share of the jointly owned home, to his daughter, Lucy. Mr Laws had retired by now and a new associate prepared the Will. The title deeds were not checked.

Shortly after making the new Will, Alexander tragically died suddenly. Only on his death did it become apparent that the survivorship destination had not been evacuated. As Alexander and Barbara had not yet divorced, Alexander’s half share in the house passed to Barbara. On learning that she would not inherit a share in the house his daughter Lucy complained to Laws & Co and said that she was considering taking action against the firm.

The Claim Notification

Dear Lockton

We wish to intimate a potential claim against our firm.

We acted for Mr Alexander Moody who instructed us to prepare his Will last year. We took his instructions, and he executed a Will, which included a bequest for his daughter to inherit half of his half-share in a property he owned with his estranged wife, Barbara.

When Mr Moody died, it transpired that the title to the property contained a survivorship destination in favour of Barbara. We hadn’t picked up on this when we drafted the Will.

Mr Moody’s daughter is now taking the position that we had a duty to investigate the existence of survivorship destinations when taking instructions. She says she intends to make a claim against our firm for the loss of her intended share in the property.

I’d be grateful if you could notify the insurers.

Kind regards

Laws & Co

Underlying cause of claim

What was the underlying cause of this claim?

  • A misunderstanding as to the effect of the survivorship destination in the title?
  • A failure to identify the existence of the survivorship destination?
  • Perhaps a failure to appreciate the requirement for the destination to be evacuated, for the provisions of the Will to receive their intended effect?

Lessons to be Learnt.

The property purchase

Going back to the beginning of the case, it’s not clear if Mr Laws ever fully advised his clients of the effect of the survivorship destination.

In conveyancing transactions, a survivorship destination might be appropriate in certain situations. However, it should not be included without full consideration and without proper instructions and explanation.

When acting for clients in the purchase of a property, a solicitor should make clients aware that the way that they choose to take title might end up being very significant for them at a later date. At the stage of including a survivorship clause in the title, it’s always sensible to advise clients that, to change it in the future for whatever reason, would require the consent of BOTH parties. For example, if one of the parties, at a later date, has a change of heart over the title arrangement, both of them need to agree to evacuate the survivorship clause and remove it from the title.

Whenever a survivorship destination is being considered, it’s important that the solicitor explains the effect and potential consequences to the clients and takes written records (file notes and emails) so that there is evidence that appropriate advice has been given.​​​​​​​​​​​​​​

The Will

In this case, Laws & Co’s failure to consider the title held in joint names at the time of drafting the Will has given rise to a claim.

From a risk management perspective, it’s important to consider jointly owned property when advising clients on the preparation of a Will.

Solicitors should be aware of the possibility of a special destination in the title to the testator’s heritable property and bear in mind that such a provision might prevent the Will from being effectual. There is no point in the client setting out his or her wishes and bequests which Will never be capable of being implemented, due to the terms of the title.

In these types of cases, legal titles to any joint property should be checked and clients should be advised on survivorship destinations.

How to prevent a recurrence?

Robust Risk Management procedures:

  • Checklists (conveyancing and Wills checklists - prompting examination of title deeds and specifically, to consider the effect of any special destination)
  • Comprehensive file notes
  • Confirmatory letters of advice to clients
  • Written instructions from clients

Lockton Tools: Red Flag Wills Checklist