Benefitting from the proceeds of crime?

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Most of us have watched episodes of ‘Poirot’ where the motive for the murder was to inherit the victim’s estate or heard couples openly joke about inheriting the other’s life insurance after they have a fatal ‘accident’. However, it’s not that simple!

The Forfeiture Act 1982 prevents a person who has unlawfully killed another person from inheriting any benefit from their victim’s estate.

The forfeiture rule is strict and there is no requirement for specific intent for the killing, so even negligent manslaughter will suffice to deprive someone of their inheritance. However, equally, the act does provide the courts with very wide powers to modify the rule.

In two recent cases this discretion was considered by courts and the first illustrates that if there is no intentional wrongdoing, the rule is likely to be lifted.

An unfortunate case of careless driving

The first case of Amos v Mancini & Ors [2020] involved a 74-year-old woman who had caused the death of her husband by careless driving.

In January 2019 Mr and Mrs Amos had been travelling from their Welsh home to Kent for a family funeral when Mrs Amos drove straight into the back of a queue of stationary vehicles which resulted in Mr. Amos suffering fatal injuries.

Mrs. Amos was charged with causing her husband’s death by careless driving to which she pleaded guilty she received a suspended prison sentence and was disqualified from driving for 12 months.

Under his Will Mr Amos had left his wife his residuary estate and she would also inherit his share of their jointly owned property under the rules of survivorship.

Mrs. Amos’ inheritance was challenged by Mr Amos’ daughter by his first marriage, Mrs Mancini who, together with two other family members, stood to inherit Mr. Amos’ estate if Mrs. Amos was disqualified from inheriting under the Forfeiture Act.

Mrs. Amos’s barrister admitted that her offence amounted to unlawful killing as set out in the act but that it should not attract the forfeiture rule because she had not deliberately or intentionally killed Mr. Amos and therefore that the court should apply its discretion to allow her to inherit.

The judge stated that there was no reason why the forfeiture rule should not apply to Mrs. Amos’ case because the rule applies to a person causing the death of another by dangerous or careless driving and every instance of manslaughter no matter how culpable or innocent.

However, this rule is subject to the Court’s discretion and he took into account the extent of Mrs Amos’ culpability and the loss of her husband and commented that depriving Mrs. Amos of her inheritance would be ‘significantly out of proportion’ to her fault.

He therefore found in her favour and allowed her to take her husband’s share of their matrimonial home and inherit his residuary estate under the terms of his will.

A complex case of diminished responsibility

The second case involves Sally Challen who beat her husband to death in 2010. She was convicted of murder in 2011 but in 2019 her conviction was quashed. The charge was also reduced to manslaughter by reason of diminished responsibility.

The Forfeiture rule prevented Mrs Challon inheriting her husband’s estate or their joint assets by succession, so in September 2019 she issued proceedings under the Forfeiture Act.

The court held that the test to be applied was firstly, was the Forfeiture rule engaged and secondly should the court exercise its discretion? The court held that the forfeiture rule was engaged in this case notwithstanding the abundant evidence of psychiatric illness justifying a plea of diminished responsibility.

The court then considered exercising its discretion. Mrs Challen had been the subject of 40 years of coercive control and a history of isolation and humiliation and abuse from her husband. Her children supported her throughout and the court considered hers a tragic and extraordinary case.

If the forfeiture rule was disapplied Mrs Challen would inherit her husband’s estate including the matrimonial home resulting in a substantial refund of inheritance tax but HMRC had declined to oppose the application. In those circumstances the court decided to disapply the forfeiture rule entirely.

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Our private client lawyers advise business owners, directors and senior executives on all

aspects of estate planning, including wills, succession, inheritance tax, family trusts, powers of attorney and probate.

For further information or assistance, please contact Julie Garbutt on 0191 211 7863 or email [email protected].