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Wills: Offshore Investments – A Case Update

Published October 28, 2016 in Expatriate wills, Wealth management

THE ROYAL SOCIETY V ROBINSON [2015] EWHC 3442 (Ch)

1. THE TAKE-AWAY
The international community does not always get that “the United Kingdom” is a country comprised of Great Britain (which is comprised of England & Wales and Scotland) and Northern Ireland. These are not synonyms.

As an international lawyer, I can say with experience that people talk commonly of “British law”, or even “United Kingdom law”, although there is actually no singular legal system that meets this description. While usually well meant, this carries unnecessary risk.

Second, there are also many overseas dominions of the United Kingdom (Gibraltar, British Virgin Islands, Jersey, Guernsey, Hong Kong if it predates 1998, and so on). All of them are separate jurisdictions. Some of these jurisdictions have only a limited legal order of their own and they refer back English law by default, where there are no local laws specifically enacted. Despite that, they are still strictly not part of “the United Kingdom” or “Great Britain”.

It is not unusual to have several wills covering different countries. For this purpose, it is critically important to ensure that the right assets are covered by the right will. This is not as easy as you might think.

2. LEGAL CONSTRUCTION OF A WILL

The courts have to decide what a will means. Generally, this is decided by reference to what the words of the will would ordinarily mean, unless a specific meaning should be attributable to the words of the will, based on what the testator understood them to mean.

This is addressed in the case of Royal Society v Robinson [2015] EWHC 3442 (Ch), where the testator was living in Switzerland and simultaneously put in place a Swiss will and a United Kingdom will, although he held additional assets in the Isle of Man and Jersey. The beneficiaries under both wills were different.

Without more, Isle of Man and Jersey assets would fall outside both of these wills. If so, this would be a partial intestacy case, which would mean that a further list of beneficiaries would take the assets.

In this case, it was proved that the “United Kingdom” reference was intended to cover the Jersey and Isle of Man assets. However, that should not be treated as a general rule. The best way to ensure what is covered is to clearly state it, and ensure you keep your will up to date. Otherwise, it could be very expensive indeed to resolve this after the fact.

3. RELEVANCE

Many international business people take out off-shore financial products based in Jersey, Guernsey, BVI, Cayman, etc, or hold bank accounts off-shore in these jurisdictions. These investments can be an important part of tax planning during our lifetimes, and so should be fully covered in plans for succession.

Multiple wills should be read together in an integrated way, in order to avoid assets falling between the gaps.