Court of Appeal sets the law straight on Donatio Mortis Causa

The recent decision of the Court of Appeal in King v Chiltern Dog Rescue [2015] EWCA Civ 581 seeks to constrain the law of gifts in anticipation of death, and clarifies the test to be applied in determining such claims.

The Facts

June Margaret Fairbrother was a consummate animal-lover, keeping cats and dogs and supporting several animal charities. In 1998 she made a will leaving the bulk of her estate between seven charities, including the Chiltern Dog Rescue and Redwings Horse Sanctuary, the appellants.

Mr King, her nephew, led a less enviable life. He was bankrupted in 1990 and again in 2000. In 2005 he was convicted of acting as a company director despite being disqualified, and spent 3 months at Her Majesty’s pleasure. He separated from his wife and, in 2007, moved in with his aunt who was increasingly frail.

Mr King claimed that his aunt promised him her home after her death. She wrote a short note in 2010 leaving him her home ‘in the hope that he will care for my animals after my death’ – the note was not a valid will.

At about the same time a conversation took place in which the testatrix presented her nephew with the deeds to her home and said “this will be yours when I go”. The property was unregistered.

Two further documents were prepared purporting to gift the house to Mr King in the event of the testatrix’s death, but neither were valid wills.

Mrs Fairbrother died on 10 April 2011, and Mr King promptly dispatched all of her animals to homes and claimed ownership of the house or, in the alternative, reasonable financial provision under the 1975 Act.

Charles Hollander QC, sitting as a deputy High Court Judge found that there was a donatio mortis causa (‘DMC’). He accepted Mr King’s evidence ‘with a very considerable degree of circumspection’ and found the requirements for a DMC were satisfied.

The Law

The Court of Appeal began, inevitably, with Justinian’s codification of the rule (Institutes, book 2, title 7). This is followed in several of the eighteenth and nineteenth century cases, which repeat the need for strict proof of the alleged DMC. Nearly every such claim failed – Cosnahan v Grice (1862) 15 Moo. P.C. 215; Re Beaumont [1902] 1 Ch. 889. Rare examples of successful claims are Wilkes v Allington [1931] 2 Ch. 104 and Re Craven’s Estate [1937] 1 Ch. 423, neither of which involved real property, but Sen v Headley [1991] Ch. 425 (in which the dying donor presented the only key to a box containing the deeds) was also successful.

Nourse LJ set out a three-part test in that case:

  1. A must make a gift to B in contemplation of impending death;
  2. The gift must be conditional upon death. Until then it may be revoked, and will revert if A survives;
  3. There must be some delivery of the subject-matter of the gift, amounting to parting with dominion.

The recent decision of Vallee v Birchwood [2013] EWHC 1449 (Ch); [2014] Ch 271 came under much scrutiny. An elderly father, in poor health, handed his daughter a key and deeds to his house, saying he wanted her to have it when he died. The claim succeeded.

But Jackson LJ held the first requirement – contemplation of impending death – was not satisfied in Vallee. The donor did not “have reason to anticipate death in the near future from a known cause”; if the donor survives that cause, the gift reverts, even though he will ultimately die nevertheless. Vallee was, the Court held, wrongly decided.

The second requirement – gift must be stated to revert if the donor survives – is an essential requirement, although there may be circumstances where the donor is so certain of imminent death that it is not expressed in terms – see Wilkes (supra).

The third requirement – delivery of ‘dominion’ – has caused the most difficulty, particularly where the gift is conditional and revokable.  Jackson LJ’s conclusion was that ‘dominion’ means physical possession of:

a)    The subject-matter itself;

b)    Some means of accessing the subject matter; or

c)     Documents evidencing entitlement to possession of the subject-matter.

Application to the Facts

Applying those three requirements to the facts in hand, the Court found that Mrs Fairbrother was not contemplating an imminent death, and the first requirement was not satisfied. In the words of Jackson LJ “If [the testatrix] was dissatisfied with her existing will and suddenly wished to leave everything to the claimant, the obvious thing for her to do was to go to her solicitors and make a new will.”

Moreover, Mrs Fairbrother’s words “this will be yours when I go” did not satisfy the second requirement; they are more consistent with a testamentary disposition, albeit one which does not comply with the Wills Act 1837. Her subsequent attempts to make new wills of her property show that she had not gifted the house to her nephew. It was suggested that the subsequent (invalid) wills implicitly revoked the gift, but this was held to be wrong.

The delivery of deeds to Mr King did satisfy the third requirement.

Comment

Donatio mortis causa is an exception to nearly every rule; the Statute of Frauds 1677, The Wills Act 1837; s.52 Law of Property Act 1925; the rule that equity will not perfect an imperfect gift. It is a positive invitation to abuse, having none of the protections afforded by a formal will, such as independent witnesses. It is for this reason that the Court of Appeal felt it should be ‘kept within its proper bounds’. This is achieved in two ways:

First, there is a stringent burden of proof on the claimant to the gift. This is variously described as demanding ‘the strictest scrutiny … evidence of the clearest and most unequivocal character’. Although Jackson LJ did not allow the charities’ perversity appeal, he expressed serious doubts on the judge’s decision to believe Mr King, and Patten LJ for his part would have allowed the appeal on that ground. Comparison might be made with the standard set out in Re B (Care proceedings: standard of proof) [2008] UKHL 35.

Second, it is clear after King that the first requirement is now more stringent than previously appreciated. The donor must (a) anticipate death in the near future, (b) from a known cause. Mere old age or frailty will not suffice. The ‘near future’ in these circumstances is hinted at by Patten LJ’s judgment: He considered the periods of survival in the successful cases – Sen v Headley (three days), Re Craven’s Estate (five days) – as opposed to the six months in Mr King’s case, the clear indication being that ‘near future’ should be measured in days rather than weeks.

In practical terms, a better way of approaching the latter question is: ‘Did the donor (subjectively) have time to execute a will or codicil to dispose of the subject-matter?’. If the answer is plainly no, then the first requirement is likely to be satisfied. If not, the Court is likely to find that the donor ought to have followed that course, and thereby avoided the hazards which plague the doctrine of donatio mortis causa.

Aidan Briggs