Familiar territory?

England and Wales and Scotland are linked geographically, culturally and politically. Movement between the two jurisdictions has always been common. The implications of this for clients, however, seem to receive scarce attention in the legal press. This may result from the thinking that conflicts of private international law and double taxation issues do not arise in cases involving England and Wales and Scotland.

Indeed, the two jurisdictions apply the same principles of situs and domicile to determine the applicable law governing succession to immovable and movable property. They are also subject to the same UK-wide capital taxation regimes. Nonetheless, where internal succession rules are concerned, distinctions abound. The principles relating to beneficial interests, validity of wills and devolution of testate and intestate estates provide a few examples. The following case studies practically illuminate significant distinctions and their implications.

Execution errors

Bill and Ben both have domiciles of origin of England and Wales. After meeting at Edinburgh University, Bill settles in Edinburgh. Ben returns to Newcastle. After several years, they commit to buying a Scottish property together. While looking for a suitable home, they accrue separate savings and instruct a Scottish solicitor to prepare mirror wills. The testing clauses conform to the requirements of s.7(1) of the Requirements of Writing (Scotland) Act 1995.

Ben’s will is sent to him in Newcastle and he executes this in the presence of one colleague. He dies unexpectedly shortly afterwards. The will is invalid given it was not executed in accordance with the law of the territory where it was signed, where Ben resided nor where Ben was domiciled.[1]

Ben therefore dies intestate, leaving no surviving spouse nor issue. The intestacy provisions in England and Wales apply so that Ben’s parents receive his estate in equal shares.

Complexities of cross-border intestacy

Fred and Wilma married in 2020. Neither party has children. Fred has a Scottish domicile of origin. After Wilma, Fred’s closest relatives are his father and his only sibling, Julie. Fred and Wilma own a home in Manchester as tenants in common. Fred’s share is worth GBP250,000. Fred also owns a property in his hometown of Aberdeen, worth GBP400,000, and GBP800,000 of cash investments. Given Fred and Wilma are largely financially independent, Fred does not update his English will, prepared in 2016 when the couple acquired their Manchester property. This provides for Fred’s estate to pass to trust for Julie. Since retiring from a role involving extensive travel in 2022, Fred spends most time in Manchester but returns to Aberdeen occasionally to see Julie. Fred dies in October 2023. Wilma consults a Manchester-based solicitor, who considers that Fred died having acquired a domicile of choice in England and Wales. Fred’s will was not made ‘in contemplation of marriage’ and was therefore revoked on marriage to Wilma.[2]

Assuming the solicitor’s domicile analysis is correct, the intestacy provisions in England and Wales apply to determine that Fred’s share of the Manchester property, as well as all personal effects and investments, pass to Wilma.

However, the Scottish intestacy provisions determine succession to the Aberdeen property. Wilma has no right to the property itself, as she would if she resided there when Fred died. She will receive GBP89,000 plus interest, realised on sale. Half of the remaining net value of the Aberdeen property passes to each of Fred’s father and sister.

Wilma is exclusively entitled to take the grant of letters of administration (the Grant) from the Probate Registry in England and Wales. The Grant is recognised in Scotland, enabling Wilma to sell the Aberdeen property.

Fred’s sister cannot bring a claim under the England and Wales Inheritance (Provision for Family and Dependants) Act 1975, as Fred was not financially maintaining her before he died. She may wish to challenge Wilma’s assertion of Fred’s domicile in the Grant application, given she would receive half of Fred’s movable assets if he retained his Scottish domicile of origin at death.

Conundrums of contemporaneous deaths

Homer (68) and Marge (65) are married with two adult children; Lisa (37) and Bart (34). Homer and Marge have always been domiciled in England and Wales. Their mirror wills provide that their children receive the GBP10 million second estate equally.

Lisa and Bart prepared wills in 2012, before meeting their spouses. Each will benefits their sibling exclusively or, if that gift fails, a charity. Lisa’s will was prepared in Scotland during her studies there. She later married Logan and they settled permanently in Glasgow. Bart’s will was prepared in England, where he remains, now living with his wife Betty in a property owned in his name. Lisa contributed GBP250,000 to the purchase price. Betty and Bart have one young child. None of the wills contain minimum survivorship provisions.

Homer, Marge, Bart and Lisa die in an accident in August 2023. The order of deaths cannot be determined. The law of England and Wales deems that Marge survives Homer, as the younger party. Marge therefore inherits Homer’s estate. Half of Marge’s net estate then passes to each of Bart and Lisa, as they are also deemed to survive their mother.

Lisa’s Scottish will has not been revoked by marriage. She dies domiciled in Scotland. Scots law deems that she and Bart died at the same instant. The gift to Bart therefore fails and the charity takes Lisa’s estate. Logan’s only entitlement is to a ‘legal rights’ sum, legal rights being the form of forced heirship applying to the movable death estates of Scottish domiciliaries leaving a spouse and/or issue.

Bart’s English will was revoked upon marriage to Betty.[3] He therefore dies intestate. Betty receives all of Bart’s personal effects, GBP322,000 (plus interest) and half of his residuary estate. Her child will be entitled to the other half, on turning 18.

A resulting trust (implied by the law of England and Wales) is presumed to apply over a share of Bart’s property, corresponding to Lisa’s contribution, in the absence of evidence that Lisa intended it as a gift or loan.[4] This interest ‘results’ to Lisa’s estate. It is immovable and therefore irrelevant to Logan’s legal rights entitlement.

Majority matters

Cecile is domiciled in England and Wales. She wishes to pass significant cash to her four grandchildren, aged between nine and 16. She dismisses settling a substantive trust, confirming she is content, ‘provided they can’t demand it all before they’re 18’. Her English solicitor creates a bare trust in May 2023, with funds held for Cecile’s four grandchildren, equally. Her grandsons Bob (16) and Paul (15) have always lived in Scotland, with their mother (Cecile’s daughter), Ruth. Ruth married their father Fergus (a Scottish domiciliary) before their birth, but is now separated from him. Bob can demand his share of the funds, having turned 16.[5]

Paul dies in July 2023. Aged 15, he could have prepared a Scottish will. As he did not, the Scottish intestacy provisions apply to Paul’s quarter-share, to benefit Ruth (25 per cent), Fergus (25 per cent) and Bob (50 per cent).

The non-dom distinction

Enid has a domicile of origin of England and Wales. She owns property in Denmark, Scotland and Wales. She prepares a will in Wales, exclusively disposing of her UK assets, and a distinct Danish will. Enid later immigrates to Denmark and dies domiciled there, having retained the Welsh will.

As Enid dies domiciled in Denmark, the grant of probate of the Welsh will (issued in England and Wales) will not have UK-wide effect. A distinct application to the Scottish Sheriff Court for confirmation of the Welsh will would be required. A lawyer qualified in England and Wales must confirm the will’s formal validity according to that jurisdiction’s laws.

Conclusion

The laws relating to succession in England and Wales and Scotland markedly differ. Advice should be sought from qualified lawyers in each jurisdiction where clients have connections to both.