Solicitors often act as a steadying influence when you are most vulnerable and will advise on the decisions you make that are not as sound as you think as the following case shows, where a wealthy financier was terminally ill and wanted to give £5 million to a girlfriend.
The girlfriend had been well looked after by the terminally ill financier, he had purchased a flat for her and was giving her an allowance of £10,000 a month. He was older than her by some 30 years and had an offshore trust of approximately £30 million, he knew that he had a terminal illness so spoke to his solicitor about the gift of £5 million.
The trustees were not happy and they had a lot of discretion regarding payments and had to consider the other people who were to benefit, not least the man’s children. They were not happy with the decision to pay the woman and one in particular felt that she was a gold-digger, so they compromised by arranging to pay her in installments of £500,000 over a five-year time span, which would equate to 10 payments.
The trustees reconsidered this decision as they felt the woman was disruptive in the financier’s care arrangements and was having an undue influence on him while receiving excessive financial gain. They decided to stop the payments although two had already been made.
After the man died the woman took the law firm to court arguing that they had not acted in her best interests as she considered that she was a client of theirs even though the financier had used them for many years, it also owed her a duty of care in the financial transactions with the trustees.
The High Court dismissed her claim, and noted that she was a beneficiary only by virtue of the financier’s generosity as she had no claim on his estate. On that basis the law firm had a duty of care to him and exercised it by ensuring the gift to her was challenged and the court praised them for protecting their client’s best interest.
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