Wills 16 Flashcards
When can legacies under the will be paid?
Only after having paid off the debts of the deceased, plus funeral and other administrative expenses.
In order to vest a gift of chattel in beneficiaries, what is required of the PRs?
Transfer is achieved by delivery, in return for a receipt. Insurance should be cancelled.
In order to vest a gift of company shares in beneficiaries, what is required of the PRs?
A stock transfer form should be completed and sent with an office copy of the grant and the share certificate
In order to vest a gift of land in beneficiaries, what is required of the PRs?
- Transfer requires an assent in writing (note, this is an exception to the rule that it should be transferred by deed). * Insurance should be cancelled. * The beneficiary needs to register their interest at HM Land Registry.
Who bears the cost of a transfer of property under a will?
Beneficiary unless the will says otherwise.
If income arises on property gifted to a beneficiary after death but before it has been transferred to the beneficiary, who is entitled to the income?
Beneficiary
How are pecuniary legacies paid?
- The will usually states the source from which pecuniary legacies should be paid-it is normally the residue. * In practice, the procedure used for payment of unsecured debts is also used for paying pecuniary legacies e.g. the residue may be left “subject to” or “after payment of” the ‘ “debts and legacies”, or on trust for sale with payment out of the proceeds of “debts and legacies” before division.* Note, if there is undisposed of residuary property held under intestacy provisions, this will be used to pay pecuniary legacies before other residuary gifts
What is the doctrine of abatement of debts and legacies?
A common law doctrine of wills that holds that:* when the assets of a deceased person are not sufficient to satisfy fully all the creditors, their debts must abate proportionately, and the creditor must accept a lower value in satisfaction of the debt* in the case of legacies/annuities, when the funds or assets out of which they are payable are not sufficient to pay them in full, the legacies abate in proportion-unless there is a priority given specially to any particular legacy.
A testator left £10,000 to A, £5,000 to B, and £1,000 to C. However, the estate’s only got £4,000 with which to pay these legacies. How much does each beneficiary receive?
Because the estate has 25% of the total amounts, the beneficiaries will each receive 25% of their legacies. In other words, their legacies abate proportionately. Therefore, A receives £2,500, B receives £1,250, and C receives £250.
What is the doctrine of appropriation in the context of distributing legacies under a will?
A beneficiary can ask the PRs to use a particular asset to satisfy a pecuniary legacy.
When a PR distributes legacies, what are they required to ensure the beneficiary gives them?
A receipt from a beneficiary to prove the PRs have satisfied their obligations (note minors cannot give receipt unless the will says otherwise)
What options are available to PRs when distributing property to minors given they generally cannot give a good receipt?
Unless the PRs accept the alternative view that anyone with parental responsibility for the child can give a receipt, the PRs have the following options: * Hold the property until the child reaches age 18* Use the power of appropriation, with the minor’s parent or guardian or the court giving any consent (this negates the need to retain the asset(s) until the child reaches age 18 and can save capital gains tax overall)* Appoint trustees to receive and hold the property until the child attains age 18 or * Obtain their discharge by payment of the legacy into court.
