Dying without making a will can leave your loved ones in limbo

ONE of the world's most charismatic, controversial and secretive billionaires died 35 years ago last month - and his death continues to offer an invaluable lesson for the rest of us.

Howard Hughes - aviator, playboy, engineer, industrialist, movie mogul and ultimately eccentric recluse - died in April 1976 leaving an estate worth $2.5 billion, and he had no will.

Although he died all those years ago, the legal wrangling caused by the absence of a will continues to dog his massive estate. The courts eventually found in favour of its distribution to 22 of his cousins in 1983, but that didn't end the legal challenges.

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The most notable of these has been from a Utah gas station owner, Melvin Dummar, who claims Hughes left him a sizeable inheritance after being rescued by Dummar from a breakdown at the side of a Nevada highway. Dummar claims that Hughes himself delivered a handwritten will leaving him $156 million - a will found by at least one court in the US to be a forgery. Dummar continues to press his claim, most recently in late 2007. Each time, the estate is forced to defend the claim.

And what did Hughes want to happen with his enormous fortune? No-one knows, but the simple expedient of drawing up a will would have ensured this most enigmatic of men could have gone to his grave secure in the knowledge that his wishes would be respected.

More recently, controversy has surrounded the estate of Stieg Larsson. The estate of the bestselling Swedish author of a trilogy of books, most famously The Girl With The Dragon Tattoo, is estimated at more than 20m.

Larsson died aged 50 in 2004 - and, like Hughes, had failed to draw up a will. This meant that Eva Gabrielsson, his partner of 32 years, had no claim on his estate as the couple had never married. Instead, it all went to his family.

Eva, an architect, continues to press her claim, in particular arguing that Stieg would have wished her to be in control of the literary aspects of his estate. She still has a laptop computer with a 200-page unpublished manuscript.

But what relevance do these celebrity cases have to us mere mortals in Scotland? Well, quite a lot as it happens.

Around 60 per cent of Scots die without making a will, according to official estimates. When you factor in that around 54,000 deaths occur in Scotland annually, that means that some 32,400 people die every year without making sure their estate is distributed according to their wishes. Putting that into context, the figure is equivalent to the population of Stirling.

Changes to the way that many of us choose to live our lives these days reinforce the importance of leaving a will. The most obvious example is that, like Larsson and Gabrielsson, many choose to live together rather than marry.

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Many more remarry, and take stepchildren into their lives. All of these growing trends generate additional legal complications which, left unresolved, can make dealing with a loved one's estate a much more difficult and daunting task than it needs to be.

Considerable confusion remains about who needs to make a will, and when this should be done. Coupled with a natural reluctance to tackle this issue, this leads to emotional and financial difficulties for many families.

Whether young or old, a clear definition of what is to happen with an individual's estate helps those left behind enormously.

A number of matters relating to wills are either not widely known or are commonly misunderstood.

People often assume that the law of succession will cover matters as they would wish, even if they do not make a will.

They particularly expect that if there is no will, their spouse will inherit their estate. Although a surviving spouse has certain rights (known as prior rights and legal rights), even in a fairly modest estate a significant proportion of it may pass to other relatives.

After payment of the prior rights and legal rights to the surviving spouse, the other relatives who may succeed in preference to the spouse are children, then brothers, sisters and parents. As the law stands, even nephews and nieces might inherit ahead of the surviving spouse.

If there is no will, cohabitants can make claims on an estate. These claims are precluded if a will is made. The amount that a cohabitant can claim depends on the circumstances, but it cannot ever be more than a surviving spouse would have received. The exact amount awarded is left to the discretion of the court.

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To avoid a cohabitant making a claim, you need to make a will. Even if it is intended that a cohabitant should benefit, it is better to make a will to specify exactly what amount the cohabitant should receive.

Many people assume that if they only have a small estate there is no need to make a will. Yet in almost all cases it is better to make a will than to do nothing as it usually clarifies and simplifies the administration of the estate; even if the estate is quite small, the distribution of the assets can still lead to difficulties amongst the family if it is not clear who is responsible for distributing the furniture and personal effects and who should benefit.

It is true that most people die when they are elderly, but young people should always consider making a will so that appropriate provision is made for intended beneficiaries and especially for a surviving spouse and any young children.

Especially careful consideration needs to be given to the appointment of a guardian to children under the age of 16 if both parents die in an accident; a guardian is usually the person who will look after the children if they have no parents. The will can also regulate when income and capital should be paid to children.

• David Reith is a partner at law firm Lindsays