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High Court Estate Valuation Dispute

When a deceased’s estate, made up of property and other such assets where the value is less obvious such as unquoted shares, is to be distributed amongst a number of beneficiaries, there is potential for dispute over the valuations of those assets.

A recent contentious probate case which reached the High Court demonstrated this point. It concerned the £3m estate of a wealthy Sheffield woman, Adrienne Kershaw. When she died Mrs Kershaw named her three children, two daughters and a son, Mr Kershaw, who lives in France, as her inheritors. The daughters were named as her executors, along with her accountant.

The Court heard how the value of how much the son was to receive depended on the probate value of the estate – the valuation was in the hands of the executors, the sisters, who were said to be benefiting from underestimating the estate’s true worth. Under the terms of the Will, 40 per cent of the estate went to her son in cash. The other 60 per cent was to be split between her two daughters in the form of property.

Valuation of the estate was crucial

Mr Kershaw argued that his sisters and the accountant should be removed as executors and replaced by an independent professional as they had placed an artificially low valuation on the properties which the sisters were set to inherit.

In the end the judge concluded that he had “…not been persuaded there is good reason for anyone to be removed as executor. The matters on which Mr Kershaw relies don't provide any real basis to suppose the estate will not be administered properly."

Nevertheless, the case explains why the valuation of an estate is so crucial and why when drawing a Will there should be a provision to ensure that an independent valuation of assets takes place.

Pearson Hinchliffe Solicitors are experts in Contentious Probate cases.

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