This year marks the 100th anniversary of the adoption of what are known as the intestacy rules, which came into force on 1 January 1926 as part of the Administration of Estates Act 1925. The rules are a default framework for determining who should benefit from someone’s estate if they die without a will.
As is often the case with law, even when the language does not explicitly discriminate, the impact of a particular change may fall disproportionately on different sections of the population. In this instance, the intestacy rules refer repeatedly to the ‘surviving husband or wife’ (the widow or widower), but it is important to remember three things:
1) then, as now, in heterosexual marriages, the man tends to be a little older than the woman (today, the gap is two to three years on average);
2) women tend to live a little longer than men (a two-year advantage in 1926; a four-year advantage today); and
3) men tend to have more assets than women; currently, men, on average, have 21% more wealth than women.
These facts mean that there are far more widows than widowers (a 4 to 1 disparity among older surviving spouses), and the surviving women are likely to have less wealth than surviving men.
Taking this into account, whenever you read the term ‘surviving husband or wife’ in the intestacy rules, you need to think ‘highly likely a woman’ and ‘likely with much less personal financial security than the person who has died’.
To show how changes in the rules have disproportionately affected women, I will take you through how the rules would have treated a surviving widow, whether with or without children, over the past 100 years.
In 1926, a widow without children would have received £1,000 (called the statutory legacy, worth around £75,000 today adjusting for inflation), plus a life interest in the rest of the estate. Again, a reminder that a life interest means limited rights to benefit from the estate assets, but no access to the underlying capital.
A widow with children would have still received £1,000 but would only have a life interest in half of the rest of the estate, with the other half passing to the children outright on them turning 18.
In both cases, on the widow’s eventual death, the assets in the life interest trust would go to the children, if there were any, but if not to the deceased’s other relatives (which, in order, would be: parents, siblings and their descendants, half siblings and their descendants, grandparents, uncles/aunts and their descendants, and half uncles/aunts and their descendants).
To reiterate the point, the widow in a typical decent-sized estate could receive an inheritance of far less real value than the inheritance due to pass, eventually, to much more distant relatives, such as cousins.
In 1953, two changes came into force which improved things somewhat for the widow. First, the statutory legacy was increased to £5,000 (around £185,000 adjusted for inflation). The second big change was that, while the widow’s position remained the same if there were children (namely, a life interest in half the estate, with the other half passing to the children), the situation was improved if there were no children.
If the deceased had been survived by the deceased’s parents or full siblings (or their descendants), the widow would get half the estate outright (as opposed to being held in trust), and the rest would go to those surviving parents or siblings. If there were no surviving parents or full siblings, but only more remote relatives (such as half-siblings, uncles and aunts, or grandparents), then for the first time, a widow would inherit the entire estate.
Hence, it was only in 1953 that a wife was recognised as being more ‘important’ to the deceased than half-siblings, grandparents, uncles and aunts. However, it is still worth remembering that at this stage, children were considered to be more important (assuming the couple had children) than the wife, who would only get a life interest in half the estate in addition to the statutory legacy.
As years passed, the statutory legacy was revised periodically so that by 2009 it was set at £250,000 (around £450,000 today).
The final big evolution in the intestacy rules came in 2014. While the statutory legacy remained at £250,000, a framework was put in place to increase the amount periodically in line with inflation (the current figure is £322,000).
The more significant reform, however, was that for the first time, a widow with children would receive the statutory legacy and half the estate outright, as opposed to being held in trust. Furthermore, if there were no children, then the widow would receive everything while the deceased’s parents or siblings would no longer receive an interest.
To understand how the evolving rules reflect a fundamental change in the treatment of widows, consider the following:
1) In 1926, the rules suggested that, in terms of who deserved absolute ownership of the estate, the order of importance was:
a. children;
b. all other blood relatives descended from the deceased’s grandparents;
c. The widow.
2) In 1953, the revealed order of importance was:
a. children;
b. the widow on a slightly higher standing than parents, siblings, or nieces/nephews;
c. everyone else.
3) In 2014, the widow ascended to the top of the order:
a. the widow;
b. children;
c. everyone else.
This 100-year evolution of the intestacy rules is a story of recognising wives as equal members of the family unit with their husbands, to the point where they are now treated as the most important surviving person under the rules.
While changes in the rules were always sex-neutral and may never have been explicitly heralded as bolstering the rights and position of women, if one considers the demographic context, that is precisely what they have done.
Alexander Mahdavi is a partner in the private client team at Bindmans, London
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