For people with substantial estates, the concern that the next generation might not deal wisely with a large inheritance is a common one.
When the owner of a successful company had such a worry, he arranged for his will to be drafted in such a way as to transfer his shareholding in the company into a discretionary trust for the benefit of his partner and children.
The will was drafted with a standard 'nil-rate band' clause for Inheritance Tax (IHT) purposes. Such clauses are common and operate to transfer into the trust the maximum amount allowable before an IHT liability would arise (currently £325,000).
However, the will was drafted by an inexperienced solicitor, and the clause used was not appropriate for the circumstances. In practice, it resulted in the establishment of a trust that contained no assets.
When the man died and the mistake came to light, his family went to the High Court to have his will rectified to give effect to his obvious intentions. Fortunately for all concerned, the Court accepted that the will as drafted contained a 'clerical error' and ordered that the nil-rate band clause should be interpreted as having the inappropriate wording removed, allowing the business assets to pass into the trust.
The drafting of a will should be done with great care, as changing its terms after the death of the testator can be a difficult and costly process, reducing the distributable estate and causing unnecessary delay.