Firstly, my sympathies for the news about your Mum.
There are a number of points that I think you and she need to consider, some of them being as follows:
during the week my good lady will be appointed power of attorney.
Assuming you’re intending a Lasting Power of Attorney, bear in mind that these are currently taking a couple of months to register, and can’t be used until they are registered. I don’t know whether or not there’s any urgency, but if there is it might be worth considering an ordinary Power of Attorney that doesn’t need registering. This is an extremely simple, one page document, and it could, if needed, be used pending registration of the LPA.
Your Mum needs to consider who to appoint as executors / trustees. If she goes ahead as planned then there is going to be a trust that could easily exist for 30 years or more until the cousin dies.
This is going to be quite an onerous task, which is why the beneficiaries of a Will are often appointed as executors, having a vested interest in getting the job done. However, your daughter can’t be appointed, as she’s too young, and the cousin clearly isn’t appropriate either.
Of the available choices you would seem to be an obvious choice, but as there is a minority interest (your daughter) there will have to be at least two trustees. Your sister wouldn’t be appropriate, not only because she lives in Australia but because it seems likely there would be conflict.
She would like to leave her home to my 14 year old daughter on the premise that my cousin is allowed to live in the home rent free until he passes or leaves. He's 60.
This is possible, but as others have warned, such life interests are often problematical, especially where they might last 30 years or so, as in this case. The normal arrangement is to make the life tenant (the cousin in this case) responsible for maintaining and insuring the house, but there are often arguments about major items of expenditure, such as an extension / a new heating system / a new kitchen or bathroom, which add significant value to the house and are far more than just maintenance.
It may go without saying that the longer the term of the life tenancy the greater the scope for such arguments.
Your Mum also needs to consider the trigger events for the cousin to vacate other than his death. What happens, for example, if he goes into care, but it’s not clear whether it’ll be permanent or not, or if he starts to cohabit with someone – does your Mum want to provide lifelong accommodation for his partner as well? Or he may go on holiday to sunny Spain and just stay there indefinitely – should that mean he loses the right to live in the house, and if so how will you define these events in the Will?
Your mother therefore needs to give very careful thought to this.
There are also various alternatives that she might consider, such as limiting the period of occupation until say, your daughter reaches 18, or to a fixed term, such as 5 or 10 years. She could also give him the option of buying the house at a hefty discount for a period of, say, a year after her death.
But overall, I think it would probably be better to give him perhaps a year’s rent free occupation, which would give him time to sort something else out, and a decent cash legacy that he could perhaps use towards finding somewhere else.
The purpose of my post is really to ask if anyone knows if we can raise a will respecting my Mum's wishes or would it be a will that could be challenged.
You can certainly produce a Will that reflects your Mum’s wishes. Whether it would be sensible to do so is another matter.
Likewise, any Will can be challenged. The object of the exercise is to try to make sure that it wouldn’t be worth anyone challenging it. However, in this case it seems that the biggest threat by far would be from the cousin.
This is because although he’s not `cohabiting’ with your Mum, and is not therefore within one of the defined categories of claimants, he may well be able to demonstrate a degree of financial dependency on her. If he’s living in her house rent-free then that would almost certainly amount to being `maintained’ by her for the purposes of the 1975 Act, and would provide a strong basis for a claim.
Consequently, even if your Mum wasn't inclined to provide for him I would have advised her to do so, simply to avoid a claim. In fact, had the relationship not been a close one (which it evidently is) it would have been an ideal candidate for a `no contest' clause!
It’s obviously a very delicate situation, and although I can appreciate that your Mum would probably not want to involve the cousin in a discussion about what he wants after her death it may save a lot of problems in the long run if such a discussion were to take place.