When the only way is a will

At the time of his death, the 31-year-old was not married to his long-term partner, Kate, and father to an eight-year-old son, Bear, from a previous relationship with Cheryl Tweedy. According to court documents, Payne left a net estate valued at over £24 million. The absence of clear guidance regarding his wishes carries significant legal and personal implications for those he left behind and highlights an issue that affects everyone, namely the importance of making a valid will.

There are subtle differences between how the law in England and in Scotland will treat the situation, but the fundamentals are identical. In simple terms, under the laws of intestacy (which govern what happens when someone dies without a will), Bear will inherit everything, albeit not until he is an adult. Liam’s partner has no automatic entitlement to anything. Cheryl, as well as the wider Payne family, are in a similar position. None of Liam’s friends or inner circle will benefit either. It seems clear Liam would have wanted Bear to have been well looked-after, but whether he would have wanted his son to benefit to the exclusion of everyone else is far from certain. Even if this was his intention, the fact Bear should be receiving over £13m on his 18th birthday with no restrictions is unlikely to have been Liam’s wish.

It’s been reported Bear’s mother might try to alter the age at which Bear receives his inheritance, but there are also suggestions that Kate may raise a claim against the estate. The law means she would have to do this within a very short timescale, so we will need to see what happens next. It seems likely that a long-running saga, possibly involving several claims and legal actions, will now occur.

Had Liam’s affairs fallen under Scots Law, the effect of the absence of a will would be even more pronounced. Bear would still have received everything, but this would happen on his 16th birthday. Depending on the closeness of Kate and Liam’s relationship, Kate’s potential claim to the courts could have been substantial – possibly amounting to the equivalent of what she would have got had they been married. Any award would have depended on many factors and be at the courts’ discretion.

This situation once again brings into sharp focus the chaos, uncertainty, distress and extra cost that not having a will can cause for all concerned.

Some of the effects of Liam’s sudden death could not have been avoided even with a will being present. These would include the significant sums (in the region of £10m) which HMRC will now receive in Inheritance Tax. It is possible those who benefited from gifts from Liam in the seven years prior to his death will also now be faced with unexpected tax bills. Again, careful planning could have mitigated any tax liability and ensured more went to who Liam would have wanted, not the Treasury.

Overall, while death is not something any of us want to contemplate, planning is vital and having a will is fundamental irrespective of age and circumstances – possibly the most important advice any private client lawyer can provide.

Graeme Dickson is a Partner, Thorntons​