Wills - house to Beneficiary 1 and rest of estate (cash etc) to Ben. 2. House sold to pay for care

sillygoose1

Hypothetical situation, I would like to know what would happen (with a straightforward will and no special circumstances that I haven't mentioned)

Jane (say) is a widow and has written the will to leave the house (owned outright) (worth, lets say £300,000) to Beneficiary 1 and the rest of the estate (cash, savings accounts, shares etc) (around £200,000) to Beneficiary 2.

Jane then goes into care towards the end of her life (not expected at the time of writing the will) and decides to sell the house to pay towards the fees (which she has to pay as she has more than the £23,000 in 'capital'). £50,000 of the cash from the house is subsequently used to pay for care during Jane's lifetime.

At probate would the executor have to give £450,000 to Beneficiary 2 and nothing to Beneficiary 1 (as there is no 'house' to speak of, since it's been sold) or would they have to treat the remaining cash from the house as Beneficiary 1's "share" and would give £250,000 to B1 and £200,000 to B2?

I ignored solicitors fees etc etc for the purpose of the question to keep it simple, obviously I realise the amounts wouldn't be exactly that after the admin costs and so on.

Thanks!

Edited to add:
Jane now has doubtful "capacity" due to fairly advanced dementia (diagnosed). There's a power of attorney in place, so "Jane's" decision about what's the best thing to do (sell the house, or not...etc) would probably be the attorney's decision. All the relevant paperwork is in place.

B1 and B2 are joint attorneys (able to act separately)

The attorney has to act on Jane's best behalf, not (e.g.) what's the best outcome for me and B1. And it may well be that from Jane's own perspective, it's best to sell the house at this point.

All very tricky!!

gettingtheresometime

My understanding is that if the property is specifically mentioned in the will but no longer under the ownership of Jane at the time of death, that bequest fails.

If the sale proceeds are in a bank account bequeathed to another beneficiary then they get what's in the bank account.

Of course they could do a Deed of Variation.

swingaloo

Whats to say the savings wouldn't be used to pay for the care first rather than the house being sold?

sillygoose1

swingaloo wrote: »

Whats to say the savings wouldn't be used to pay for the care first rather than the house being sold?

Yeah, they could be (it's a "hypothetical situation" in that it is real but hasn't fully happened yet, if that makes sense!) and from a certain point of view it would make more sense to do that, but it's Jane's decision (and her reasons for selling it would probably be something like: I won't be moving back out of the care home, no one else is living there, don't want to deal with renting out the house or leaving it empty, etc) so in some sense it is a "cleaner" solution to sell the house up front.

silvercar

At the time Jane sells her house she should rewrite her will.

getmore4less

What does Jane want to happen?

Fix the will if that won't happen with all the various scenarios.

Owain_Moneysaver

sillygoose1 wrote: »

At probate would the executor have to give £450,000 to Beneficiary 2 and nothing to Beneficiary 1 (as there is no 'house' to speak of, since it's been sold)

Correct, the bequest fails.

Jane should have her Will rewritten to leave three-fifths of her estate to B1 and two-fifths to B2. That takes care of there being no house, or alternatively a house but no money in the bank.

Keep_pedalling

silvercar wrote: »

At the time Jane sells her house she should rewrite her will.

Even better don’t leave specific assets to major beneficiaries. No one knows when they could suddenly lose mental capacity through accident or illness and if it happens then you can’t make changes to reflect your new situation.

A good will will cover such situations and not accidentally disinherit a loved one.

sillygoose1

There's a "power of attorney" in place for Jane (both types - financial and the other one which I can't remember what it's called) and at this point it's not clear that Jane is capable of re-writing/amending a will with the new instructions (dementia - officially diagnosed). The 'attorney' is Beneficiary 2. I know that the 'attorney' wouldn't take any kind of "corrupt" action to benefit himself though.
And if you haven't guess it - I'm Beneficiary 1. (and I'm a joint attorney actually!)
Beneficiary 2 isn't the executor, as Jane appointed the family solicitors for that.

getmore4less

POA has no relavance at the time Jane sold her house?

sillygoose1

getmore4less wrote: »

POA has no relavance at the time Jane sold her house?

Sorry, I may have over-simplified in the original post with things I thought "not relevant" but may actually be relevant.

Jane has doubtful capacity at the moment. The attorney would have to sell the house etc on Jane's behalf.

I will edit the original with some additional info, as I hope that will help answer/explore the situation!