INTESTACY Flashcards
The rules of intestacy apply when:
*The deceased died having made no will, or at least no valid will (a whole intestacy); or
ENTITLEMENT OF SPOUSES AND OTHER RELATIVES
The rules for distribution of an intestate’s estate are set out in Section 46 Administration of Estates Act 1925. The bene-fcial entitlement is dependent upon whether the deceased was survived by a spouse or civil partner. The spouse must survive the deceased by at least 28 days.
Surviving Spouse with No Issue
If there is a surviving spouse but no issue, the spouse is enti-tled to the entire estate.
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Surviving Spouse with Issue
If there is a surviving spouse and issue, the spouse takes:
*Personal chattels (tangible moveable property, other than money and other than assets used for business or held for investment purposes) absolutely;
*£322,000; and
*One-half of the residue absolutely.
The deceased’s issue take the other half of the residue once they attain the age of 18.
Matrimonial Home
surviving spouse with issue
A surviving spouse can require the personal representatives to appropriate the matrimonial home (or the deceased’s interest in it if they were benefcial tenants in common) to the spouse in partial or total satisfaction of their interest. If the property is worth more than the entitlement of the spouse or civil partner, they can still require appropriation provided they pay over the diference (‘equality money’) to the estate.
EXAMPLE
Roberta died without a valid will. She was married to Fabio. They had two children, Emilio, aged 27, and Octavia, aged 23. Roberta’s estate comprised chattels worth £80,000 and other assets valued at £600,000. Under the rules of intestacy, Fabio is entitled to the chattels, £322,000, and 50% of £278,000 (£600,000 less £322,000). If Roberta’s estate comprises an interest in the matrimonial home, this can be transferred to Fabio in part or full satisfac-tion of his entitlement.
The remaining 50% of the residue (after any inheritance tax due) is inherited equally by Emilio and Octavia.
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No Surviving Spouse
If there is no surviving spouse, there is a strict order of enti-tlement. Earlier classes take to the exclusion of later classes. As soon as a person falling into a particular category (for example, a sibling) is identifed, the subsequent categories of persons are ignored. The order of entitlement is:
*Issue of the intestate on statutory trusts;
*Parents (equally if both alive);
*Brothers and sisters of the whole blood (that is, those who share the same parents as the deceased) on statuto-ry trusts;
*Brothers and sisters of the half blood (that is, those who share only one parent with the deceased) on statutory trusts;
*Grandparents (equally if more than one);
*Uncles and aunts of the whole blood on statutory trusts;
*Uncles and aunts of the half blood on statutory trusts; and
*The Crown as ‘bona vacantia’.
Class Members Take Equally
A class of benefciaries take equally between all members of that class if they reach age 18.
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STATUTORY TRUSTS
- ‘Statutory trusts’ means that for all classes,** other than parents and grandparents,**
- a class member’s issue takes their parent’s share ‘per stirpes’ if the class member has predeceased (provided the issue attain age 18). Per stirpes means ‘through the root’, and this term is used because children inherit through their parent’s share.
EXAMPLE
Simon dies without a valid will. He was divorced. He had three children: Amy, Bob, and Claire. Amy and Bob survived Simon, but Claire had died three years before. She had two children of her own, Diana and Eva. Simon’s estate will be divided as follows:
*One-third each to Amy and Bob; and
*One-sixth each to Diana and Eva (that is, they inherit Claire’s share equally between them as her issue).
Exam Tip
Do not confuse statutory trusts with the rule that saves a gift contained in a will from lapsing (but only if the giftis to the testator’s issue). Note that statutory trusts differ in two ways: (1) they can apply to any class of intestate
benefciary, except grandparents or parents, and (2) they apply only to intestacy.
Potential Benefciaries
When a potential benefciary is living at the intestate’s death but subsequently dies before attaining a vested interest (that is, before attaining age 18), their issue (if any) take their deceased parent’s share on statutory trusts. If the potential benefciary dies without issue, the estate will be administered as if that benefciary had never existed.
ADOPTED CHILDREN
Adopted children are treated for intestacy as the children of their adoptive parents and not of their natural parents. If an adopted individual dies intestate without spouse or issue, their estate will be distributed between the closest relatives in the adoptive family. An adopted child may also inherit on
the intestacy of any member of their adoptive family.
ILLEGITIMATE CHILDREN
The intestacy rules apply regardless of whether or not an individual’s parents were married to each other. However, if a person dies intestate and their parents were never married, the law presumes that their father has not survived the deceased—unless there is evidence to the contrary or their father was named on their birth certifcate.
