The worldwide number of people living with dementia in 2015 was estimated at 47 million. By 2030, that figure will reach more than 75 million, and by 2050, more than 135 million[1]. The latter is equivalent to the combined populations of the UK and France with one new case being diagnosed every 3.2 seconds[2].
This demographic time bomb has well-documented socio-economic consequences. It is also of critical importance for the international legal community and in particular those advising on wills, probate and trust affairs.
Between 2013 and 2014, the number of claims reaching the High Court in England and Wales involving a contested will rose by more than 80 per cent – and those claims represent only the tip of the iceberg, which looks set to increase in size as a result of several factors:
- Increase in property values: The enthusiasm for a challenge to testamentary disposition is directly affected by the amount in issue. A claim is not worth bringing unless the potential rewards justify the expense of litigation. Property prices have enjoyed unprecedented growth in recent years, and the values need not be very high in order to justify mounting a challenge.
- Interest rates: Historically low rates of interest since 2008 have also allowed older and more cautious homeowners to pay off substantial amounts of mortgage debt rather than borrow big and upscale. This means that parties have a share of the unencumbered property in their sights when assessing the merits of a claim.
- Taxation: Changes in domestic taxation laws – for example, inheritance tax and the laws governing pensions – will also have an impact on the size of the estate.
- Blended families: As we live longer, there is an increased potential for people to tire of one life partner and form a new relationship, complete with stepchildren or adopted children, as well as those born to the relationship. As the number of potential beneficiaries increases, so too the potential for discord and litigation.