A landmark ruling that an aristocrat’s son can potentially benefit from family trust funds despite being born to a surrogate mother highlights the need for new inheritance laws, a lawyer has said.
The 8th Marquess of Bath supported the trustees of his family fortune in recognising the legitimacy of his younger son despite the historical descriptions of family relationships in legal settlements.
Henry, nine, is the biological child of the marquess, Ceawlin Thynn, and his wife, Emma, Marchioness of Bath.
The couple had their firstborn, John, in 2014
The couple, who married in 2013, had their second child by surrogacy after the marchioness suffered hypophysitis, a swelling of the pituitary gland, during her first pregnancy and was warned a second birth could prove fatal.
Thynn, 51, who runs the 9,000-acre Longleat estate and safari park on the Wiltshire-Somerset border, described their joy after Henry was born in December 2016, two years after the birth of his heir, John, 11.
His wife, 39, a model and former contestant on the BBC programme Strictly Come Dancing, said: “We are simply ecstatic. His arrival has completed our little family and brought us so much happiness.”
The family trusts were worth an estimated £215 million in 2020, according to the Sunday Times Rich List.
The Longleat estate in WiltshireEnglish Heritage/Heritage Images/Getty Images
However, there were concerns about inheritance and tax issues because Henry was born to an American surrogate in the US.
The High Court was told that the three family trusts retained the “pre-1970, common law meanings of descriptions of family relationships” so there was “uncertainty as to whether Henry falls at present within the class of beneficiaries”.
The trustees asked the court for approval to make potential provision for Henry.
Henry Legge KC, who represented the trustees, told the court that Henry could reasonably expect to inherit after his elder brother “in the same way as any future legitimate naturally born sibling” and “take priority over any such subsequently born sibling”.
Mr Justice Matthews ruled last week that the issue could “not have arisen in practice until the egg extraction technology was developed which led to the birth of Louise Brown in this country in 1978”.
The judge said that the trustees had been advised “that it is at least doubtful that Henry is within the class of beneficiaries” of the family trusts. The marquess and his wife “consider it would be unfair and unfortunate if their second son and his issue were excluded from benefit”.
At this stage the trustees only want the power to add Henry as a beneficiary, not yet to exercise it.
The judge, sitting in Bristol, said: “This is to avoid any problems with US tax, as he was born in America to an American surrogate mother. A decision can then be taken at a later stage, in the light of appropriate advice, whether to exercise the power to add him … The present proposed advance on new trusts will achieve that object, and will be a material benefit to [the marquess] as the father of both boys, who will not have to make provision for Henry out of his own resources.”
The judge concluded that he was “satisfied” the court should approve the proposal and that the trustees had the power to do what they propose.
Alexander Thynn, 7th Marquess of Bath, and his son Ceawlin in 1984David Montgomery/getty images
Sarah Aughwane, who specialises in trusts, estates and inheritance disputes at the law firm Withers, said after the ruling: “Our legislative framework has arguably failed to keep up with the modern concept of family, particularly when it comes to dealing with blended families and families navigating the complex world of international surrogacy.”
The number of parental orders transferring legal parentage from a surrogate mother are reported to have increased from 100 in 2011 to more than 500 last year.
Aughwane said: “Dynastic trusts, of the type often used by families like the Marquess of Bath’s, will frequently have been drafted decades ago, when the concept of family was very different, and what was medically possible less advanced.
“The courts appear to be broadly sympathetic to finding a way to ensure that modern families are not discriminated against. However, there can be challenges, depending on the trust and the family involved. Legislative change may be needed if there is to be a consistent approach.”
Henry is named after his great-grandfather, the 6th Marquess, who opened the 16th-century Longleat House and gardens to the public after the Second World War and created the country’s first safari park.
The 7th Marquess, who was notorious for his relationships with numerous “wifelets”, handed over the running of the estate to his eldest son in 2010. The pair became estranged when Thynn removed some of the erotic murals painted by his father.
Thynn inherited his title when his father died aged 87 having contracted Covid in 2020. His wife, whose father was a Nigerian oil tycoon, became Britain’s first black marchioness.