Family: Death and financial provision

A recent UK Supreme Court decision, Unger v Ul-Hasan [2023] UKSC 22 has emphasised further the difference in approach to financial provision (or financial relief, in England) between Scotland and England. This case concerns whether the availability of a claim for financial relief in England is an individual’s personal right (i.e. ends on death), or one which survives the death of a spouse. If the latter, the court was asked whether the claim was capable of being brought against the spouse’s estate.

Spouses Nafisha Hasan and Mahmud Ul-Hasan married in 1981 and divorced in Pakistan in 2012. Hasan applied to the High Court for financial relief in England on the basis that the parties’ overseas divorce was recognised in England, affording her the ability to make financial claims similar to home-divorcing couples.

Ul-Hasan passed away before the matter was determined by the court. Hasan sought to continue the action against his estate. The High Court refused Hasan’s claim stating that, in brief, the right to claim financial relief is a personal right that ends on death of the spouse, in line with previous Court of Appeal authority. The judge however questioned whether that authority was wrongly decided and certified the case as suitable for a “leapfrog” appeal direct to the UKSC, which granted permission to appeal. Hasan died prior to the appeal hearing and her daughter and son in law were substituted as appellants.

The UKSC affirmed the High Court’s view and clarified the law as follows:

1. Rights against spouses for financial relief are personal rights which can only be adjudicated between living parties. If these rights survived death, it would create implications for insolvency and succession law. To change the law would require Parliament’s involvement, as its intention to create a personal right was clear in legislation and successive case law.
2. Given the above position, the court need not consider whether such an action can survive against a spouse’s estate.

Scottish contrast

In Scotland the transmissibility of lifetime monetary actions to the deceased’s executors in the event of a pursuer or defender’s death before court order, is a matter of established general legal principle. The status of marriage or civil partnership comes to an end on divorce or dissolution of the partnership, or else when one of the parties dies. It follows that a party’s ability to claim financial provision against their spouse or civil partner also terminates on death, but it is replaced by rights of succession insofar as those rights have not been revoked by prior agreement during lifetime. In other words, a surviving spouse or civil partner has an automatic right to receive a fixed amount of the deceased’s net heritable and moveable estate even if the pursuer and the deceased were separated.

A spouse or civil partner’s right to inherit from the other’s estate cannot be defeated by a will. There are only two ways a spouse or civil partner will lose their rights of succession. The first is to formally discharge them during lifetime (which is often done following separation and before divorce/dissolution is granted). Or, secondly, on getting divorced or on dissolution of a civil partnership, per s 1 of the Succession (Scotland) Act 2016.

Cohabitant claims

Interestingly, contrast this with the right of a cohabitee in Scotland. Cohabitation does not confer the same legal status as marriage. It does not require legal intervention to bring it to an end. A relationship terminates on cessation of cohabitation, which is a matter of fact. Therefore, a former cohabitant cannot replace a lifetime action brought under s 28 of the Family Law (Scotland) Act 2006 with a s 29 claim in the event of the other’s death. A s 29 claim is only appropriate if the deceased died intestate; was domiciled in Scotland; and was cohabiting with their former cohabitant immediately before death. A former cohabitant has no entitlement to inherit any extent of their partner’s estate unless there is specific provision made for them in a will, nomination or survivorship destination. However, a cohabitant does have the right to make a monetary claim against the deceased’s estate so long as that action is served on the executors within six months of the date of death.

What happens if a party to a s 28 claim dies before an agreement is reached, or an order of the court granted? Can the former cohabitant’s claim be transferred from the deceased to the deceased’s estate (or vice versa)?

There is no specific authority regarding the transmissibility of s 28 claims. Accordingly, general principles would apply which state that pecuniary claims can be made on behalf of and against the estate of a deceased, and this was reiterated by the Scottish Law Commission in its report (No 135) which led to the 2006 Act. Assuming a s 28 claim has satisfied the definition of cohabitation and was brought within one year of separation, it is a contingent liability of the deceased’s estate which requires to be determined by the court, or conceded by the executors, in the same way as any other liability of the estate.

Last November the Scottish Law Commission published its Report on Cohabitation (No 261). There is, however, no proposed change to the above legal procedure should a party to an action die before the matter is resolved.