In re Goodchild, decd (Goodchild v Goodchild)

The doctrine of mutual wills requires a contract at law, proved by clear evidence, that both wills will remain unaltered and that the survivor will be bound to leave the combined estates as agreed. Identical wills, a common expectation, or a shared wish about the ultimate beneficiary is insufficient. If the agreement is proved, equity may impose a floating trust which becomes irrevocable on the first death.

Family provision is a separate inquiry. Under the Inheritance (Provision for Family and Dependants) Act 1975, a moral obligation and the child’s straitened circumstances may require maintenance provision even without legal entitlement. Statutory variation orders must also be demonstrably within the jurisdiction.

Dennis and Joan Goodchild made wills leaving their estates to the survivor, intending that their son Gary would ultimately benefit. After Joan’s death, Dennis remarried and made a new will in favour of Enid. The High Court held that the earlier wills were not mutually binding, that no separate agreement or estoppel had been established, but that Joan’s understanding created a moral obligation supporting an award under the Inheritance (Provision for Family and Dependants) Act 1975. Gary was awarded £185,000.

Enid appealed against the award. Gary and Margot cross-appealed on the mutual-wills issue. The central questions were whether the wills created an irrevocable equitable obligation and whether provision for Gary was justified despite the absence of a legal obligation.

The appeal and cross-appeal were dismissed unanimously. Leggatt LJ gave the leading judgment. Morritt LJ agreed and added observations; Phillips LJ agreed.

1. Mutual wills. The doctrine requires a contract at law, established by clear evidence of a mutual agreement that both wills would remain unaltered and that the survivor would be bound to leave the combined estates to the intended beneficiary. The resulting equitable mechanism is a floating trust, which becomes irrevocable on the first death and crystallises on the second.
2. Identical wills, a common expectation, or a mutual desire that a child should inherit does not establish the necessary agreement. The survivor must have undertaken to remain bound even if the intended beneficiary later behaved in a way regarded as unpardonable. In re Cleaver [1981] 1 WLR 939 was distinguishable because it contained specific evidence of the testators’ intentions when the wills were made. The evidence here did not establish a mutual intention that the survivor would be bound.
3. Family provision. The inquiry under the Inheritance (Provision for Family and Dependants) Act 1975 was independent of the mutual-wills issue. Where a testator has breached a moral obligation owed to a child who is in straitened financial circumstances, adequate maintenance provision must be made, having regard to the statutory factors. Joan’s understanding that Dennis would give effect to their common intentions created such a moral obligation concerning the part of the estate derived from her. Gary’s needs, the estate, Enid’s position and his conduct were properly evaluated by the trial judge. The award was not an impermissible reward for merit.
4. Variation and tax. Morritt LJ observed that, where an order under section 2(4) is structured to obtain a substantial tax advantage at the Revenue’s expense, the court should demonstrate that the order is within its jurisdiction and properly made. Consent and tax efficiency alone are insufficient. This was additional guidance and was not necessary to the disposition.

The costs order was within the judge’s discretion. The order was appeal and cross-appeal dismissed, with no order as to costs save legal aid taxation.

• Court of Appeal (Civil Division): dismissed Enid’s appeal and Gary and Margot’s cross-appeal.
• High Court of Justice: Carnwath J held that the wills were not mutually binding and that no separate agreement or estoppel had been proved, but awarded Gary £185,000 under the Inheritance (Provision for Family and Dependants) Act 1975. The decision is reported at [1996] 1 WLR 694.