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Summary Wills and Administration of Estates LPC BPP Consolidated Exam Notes - 90%
Consolidated exam notes for open book exam
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WILLS AND ESTATESKEY ISSUES
Testate/ • A person who makes a will is called a testator
Intestate • How the estate is distributed depends on their will (or lack thereof) when they died:
Testate There is a will disposing of all the All property is distributed according to the will
deceased’s property
Totally intestate There is no (valid) will All property is distributed according to the intestacy
rules in the Administration of Estates Act 1925
Partially intestate There is a will, which does not dispose of The will is followed as far as possible, and any remaining
all of the deceased’s property property is distributed according to the intestacy rules
Succession/ • Comprises of all assets which pass by either a will or intestacy rules
Distribution • Passes into the hands of the deceased’s personal representatives (PRs) who are legally responsible for administering
Estate the estate
• PR’s usually generally pay the deceased’s debts, funeral, and other administrative expenses
• Remaining assets are distributed according to the order of priority under the intestacy rules or the terms of the will
• Some categories of property are not included within the estate:
Jointly • Where the deceased held the property as one of two or more joint tenants their property does
owned not form part of the estate, but passes directly to other joint tenants under the survivorship rule
property o For tax purposes, there is deemed to be a severance of the joint tenancy immediately
prior to death (s171 Inheritance Tax Act 1984)
• Where the deceased held the property as one of two more tenants in common their “share”
does form part of the estate for distribution purposes
Insurance • The policy holder pay a monthly premium to the policy provider who pays a lump sum to the
policies deceased’s estate
written in • Value of the lump sum is agreed when the policy holder takes out life assurance
trust • Common for these policies to be written in trust and, if so, does not form part of the succession
estate
Discretionary • Terms of some pension schemes oblige pension fund trustees to pay out a lump sum of money
pension following the death of the person who held the pension
schemes/ o If no-one is nominated, the amount is payable to the PR
Lump sum o If someone is nominated or the proceeds are written in trust, the money is paid
pension directly to the named beneficiary upon presentation of the death certificate and does
benefits not form part of the succession estate
• In other schemes, the pension fund trustees may have discretion to make a lump sum payment
following death
o Usually, the deceased indicates during their lifetime who should receive the money
(usually an ‘Expression of Wish’ form)
o The lump sum paid to the third party does not form part of the succession estate
Statutory • Possible to make a statutory nomination in writing to transfer ownership on death of sums of
nominations money held in certain friendly society bank accounts
• The nominated beneficiary receives the money and does not form part of the succession estate
• Nominations are limited to £5,000 and rare in practice
Donation • A gift made during the donor’s lifetime in contemplation of, and conditional upon, the death of
mortis causa the donor
(‘DMC’) • The donor may recover the asset if they change their mind before death
• The subject matter of a DMC does not form part of the succession estate
Trusts/ • Assets held in trust/settlement from which the deceased benefited do not usually form part of
Settlements the deceased’s distribution estate
• The deed that created the trust controls the destination of the trust property
Life Interest Trust:
• Life Tenant (£ income during lifetime) and Remainderman (£ capital when life tenant dies)
• Life Tenant’s interest is called a life interest (e.g., rental income from a property)
• Remainderman’s interest is called a remainder or reversionary interest
• Trust fund is not part of the life tenant’s succession estate as it passes to the remainder
beneficiary, as in the trust deed
• Debts:
o Any debts or other liabilities must also be identified
o Debts must be met out of the estate before the remaining assets (the net estate) are distributed
o Where the estate is insolvent, the debt must be paid in a defined order
• Valuation:
o An accurate valuation of all assets must be obtained at the date of death
o Valuations require expert advice
o A schedule of assets and liabilities can then be produced
hcnotes
, INTESTACY
Entitlement to • Main categories of beneficiary:
the estate o Spouse/civil partner –
§ ‘Civil partner’ refers to same sex couples who have entered into a civil partnership
o Issue – children and remoter linear descendants
§ Includes legitimate, illegitimate, legitimated, and adopted children
• For a spouse/civil partner to inherit, they must survive the intestate by at least 28 days
• All E&W legislation whenever passed or made containing a reference to ‘marriage’, ‘married couple’, ‘husband’,
‘wife’, ‘widower’, ‘widow’ or any related expression is to be read as including a reference to marriage of a same sex
couple
Statutory order • If the intestate dies and is not survived by a spouse or issue, the statutory order of entitlement applies as follows:
of entitlement o To parents, but if none;
o To siblings of whole blood on the statutory trusts, but if none;
See Appendix 1 o To siblings of half blood on the statutory trusts, but if none;
o To grandparents, but if none;
o To uncles and aunts of whole blood on the statutory trusts, but if none;
o To uncles and aunts of half blood on the statutory trusts, but if none;
o To the crown as bona vacantia
• Where a category of relative is entitled (e.g., siblings) the amount available is equally divided between all members
of that class
Statutory trusts • Beneficiaries (other than spouses, parents, or grandparents) take their inheritance on statutory trust
• Terms:
o Share of the estate is held for any child(ren) of the intestate who survive the intestate and reach the age of
18 or marry earlier in order to inherit
§ Until this is satisfied, a beneficiary has a contingent interest
o If a beneficiary is 18 or older (or married), they will inherit absolutely and immediately as the contingency
is already satisfied
§ In this case, the beneficiary has a vested interest
AND
o If an entitled beneficiary dies before the intestate, that beneficiary’s children can inherit in their place,
provided they reach the age of 18 or marry earlier
§ This is the substitution limb of the statutory trusts
WILL DRAFTING
General • Traditionally drafted without punctuation
• Follow a standard pattern
See Appendix 2 • Numbered clauses
• Each clause will begin with the words that explain the purpose of the clause capitalised (e.g., I GIVE; I APPOINT)
Valid will Capacity • Testator must be over 18 (unless they have ‘privileged’ status)
• Testamentary capacity must exist at the time the will is executed
• Testator must have the requisite testamentary capacity
o Statutory test: s1-3 Mental Capacity Act 2005
o Common law test: Banks v Goodfellow – “soundness of mind, memory and understanding”
§ Testator must understand the nature of his act, extent of his property and moral
claims he ought to consider
• Code of practice that accompanies the MCA 2005 states that the statutory test is intended to tie in
with the common law position rather than create a new test
• Exception – Parker v Felgate – where a testator lacks capacity at the date of execution it is sufficient
that:
o The testator had capacity when giving instructions for the will; and
o The will is prepared in accordance with those instructions; and
o At the time of executing the will, the testator understands he is executing a will for which
he gave instructions
• Where the will appears rational, testamentary capacity is presumed
o If evidenced is produced that raises doubt, the onus of proof is on those seeking to have
the will confirmed as valid (usually the PRs)
Intention • Testator must have a general and specific intention to make the particular will in question
• To have specific intention, the testator must have knowledge and approval over the contents of the
will they are executing
• There is a presumption that the necessary intention exists where testamentary capacity exists, but
this can be rebutted (e.g., where the testator is blind or cannot read)
Formalities • Must comply with formalities found in s9 Wills Act 1837:
o Will must be “in writing and signed by the testator or by some other person in his presence
and at his direction”
o The testator must have intended to give effect to the will
o The will must be signed in the presence of two witnesses; and
o Each witness must attest and sign the will in the presence of the testator
hcnotes
, • If the will contains an attestation clause, this raises a rebuttable presumption that the formalities
have been complied with
o Explains the circumstances in which the will is executed and must clearly state that the
necessary formalities under s9 WA have been complied with
o Without such a clause, proof that the correct procedure was followed would be required
before probate by, e.g., affidavits of due execution
o Clause should explain any special circumstances
• Witnesses:
o Both witnesses must be present for the testator’s signature, but not for each other’s
o Should be adult and capable of attesting (i.e., must be mentally and physically present)
o Must be able to see the testator sign
o Should be traceable and able to provide evidence of due execution and the testator’s
mental state at execution
§ Full names and addresses should be obtained
o If a beneficiary of a will, or their spouse at the time of execution, acts as a witness, the
beneficiary will not be able to inherit under the will (s15 WA)
§ If there are at least two other witnesses, or if the will is subsequently confirmed
by a duly executed codicil, then the attestation by the beneficiary/spouse can be
disregarded
• Date:
o A will is not invalid without a date, but its inclusion enables the Probate Registry to
ascertain the last will of the testator
o Can appear as a separate clause at the start (commencement or revocation clause) or end
(attestation clause) of the will
Incorporation • Provisions are normally contained in one properly executed document
of documents • Changes or additions to the will are made by a codicil or revocation of will
• Terms of an unexecuted document can be incorporated into a will and can be admitted to probate (even if it does
not comply with s9 WA)
• For a document to be validly incorporated, it must:
o Be clearly identified in the will; and
o Already exist at the date of the will; and
o Be referred to in the will as already in existence at the time of execution
• Incorporation of documents should be avoided wherever possible
CHANGES AND ADDITIONS
Codicils • Formal testamentary instrument which acts as an add-on to an existing will
• The original will plus the codicil are read together, and the estate is distributed according to their combined effect
• Codicil must comply with the same formalities as the original will (s21 WA) to be valid
• Can be used to add or revoke a provision
• Republishes the will to which it expressly refers, so the will is treated as if it had been executed on the date the
codicil was executed
Alterations • s21 WA
• An alteration to a will made before the will is executed is valid and will be given effect to, provided that it was made
with the knowledge and approval of the testator
• An alteration to a will that is itself attested (i.e., signed by the testator and two witnesses (s9 WA)) is valid whether
made before or after the will itself was executed
• Presumption that unattested alterations are made after the will and therefore invalid (but can be rebutted with
intrinsic or extrinsic evidence)
Invalid An unattested alteration made after the will has been executed is invalid (s21 WA) and the alteration will not
alterations be given effect unless re-executed or confirmed by a later codicil
Effect of • If the original wording is apparent, then the will with the original wording is admitted to probate
invalid and the attempted alteration is ignored
alterations • Apparent – original wording can be deciphered by natural means
• If the original wording is not apparent, because it has been obliterated, covered over, or cut out,
then the will is admitted to probate with a blank space where the obliteration was
• No extrinsic evidence is permitted to work out what the original gift was, and the
beneficiary loses out
• If the testator has obliterated the original gift and attempted to replace it with an alternative, but
the alteration/substitution fails because it is unattested, this is called a conditional intention to
revoke
• Court considers that the testator only intended to remove the original gift if the attempt at
substitution was successful, and if it was unsuccessful, the original gift should take effect
• If the original gift is visible, this is given effect to
• If the original gift cannot be easily deciphered, the court will allow extrinsic evidence to
determine the original wording, so the beneficiary receives something
hcnotes
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