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Mutual Wills are a means by which two individuals can make Wills knowing that once one of them has died, the other is not free to change their Will. They are extremely rare and often unwise but a recent court case (Charles and others v Fraser) has leading to a finding that two sisters had made mutual wills - only the third such finding in 80 years.
Mabel and Ethel made identical Wills in 1991; at which time they agreed that these would be binding on whichever of them survived, but this was not stated explicitly in the Will or in writing elsewhere. Mabel died in 1995 and Ethel inherited her estate. In 2003 and 2006, Ethel made new Wills and she subsequently died. The beneficiaries under the 1991 Will sued the main beneficiary of the 2006 Will to get their inheritance.
It is very common for couples to make Wills in identical terms but that doesn't make them mutual wills. There has to be a binding agreement that the survivor will honour the terms agreed and not chance the terms of their own Will later; importantly, the agreement only becomes binding once one of them has died and up to that point either of them is free to change their Will.
It was unfortunate in this case that the 1991 Will did not explicitly state that it was a mutual will because that would have made the situation much clearer for everyone and the costs of the litigation might have been avoided. Without that clarity of evidence, it is very hard indeed to establish that there was actually an intention to make a binding agreement which is why when the picture is uncertain enough that it has to go to court, the courts usually decide that there was no such agreement.
Mutual Wills are sometimes raised by couples with 2nd marriages as a way of ensuring that children from an earlier marriage are protected. This can lead to litigation even if the fact of their being mutual wills is made clear. Such Wills are therefore usually discouraged. If people are going to do them however, the agreement has to be set out clearly on the face of the Will and also in other written evidence, and couples might even consider making a joint will for clarity.
More importantly, mutual wills do nothing to prevent the funds from being spent in the lifetime of the survivor and in particular they offer no protection against them being used by the survivor to pay care home fees. In most of these situations, the use of a trust by the first person to die is a much better solution and is usually what we would recommend.
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