It’s not often you hear of someone turning down a substantial inheritance. But that’s exactly what happened in a case decided by the high court last week. The motivation of insolvent Nicholas Valasis? To avoid paying a debt.
At this stage, Valasis signed a formal document in which he purported to repudiate the bequest from his mother, saying it should devolve on his three children instead. Not long afterwards, Ahmed, who had still not been paid, applied for Valasis to be declared insolvent and, a few months later, a final order to that effect was granted by the court.
Valasis tried again, now simply stating that he renounced the bequests from his mother. This time, the trustees of his insolvent estate claimed his renunciation of the bequests was fraudulent and took the matter to court. One implication of renunciation is that a debtor heading for insolvency could prevent creditors from claiming that inheritance merely by repudiating it, she said. But where the debtor accepts a bequest, it forms part of the insolvent estate.