Inheritance if beneficiary dies first? 13 December 2022 at 4:47PM in Deaths, funerals & probate 18 replies 1.1K views

Fingers1234

We have a situation in our family where a beneficiary is likely to die before their parent.  There is a will in place and its a sensistive subject.

Is the below true or does it need to state in the will that if the beneficiary dies first it automatically goes to their children?  Certainly in my own Father and Mother's will it states specifically that if the beneficiary passes it goes to their children.  This snippet from the Co Op Legal Services seems to indicate that its general law.

Could someone help?  Of course you could ask to look at the will but that isnt really appropriate in this case.

Generally if a beneficiary dies before the deceased, the beneficiary's gift will lapse (fail) and they will not inherit anything from the deceased's estate. Whatever they were due to receive will fall back into the deceased's residuary estate to be redistributed. However the deceased may make provision in their will for the gift to be redirected in those circumstances stating that if the original beneficiary dies before them then alternative beneficiaries will receive the gift instead.

This can also happen under general law in the following circumstances:

• Where a will contains a gift to a child, adopted child or grandchild of the deceased, and
• The child dies before the deceased, leaving children of their own; and
• These children of the intended beneficiary are living at the time of the deceased's death

Then, unless the will expresses a contrary intention, the gift will take effect as a gift to the children of the initial beneficiary.

In effect, this means that if a parent leaves their child a gift in a Will and that child dies before the parent, leaving children of their own, then those children (the parent's grandchildren) will receive their parent's share.

Mojisola

Fingers1234 said:

Then, unless the will expresses a contrary intention, the gift will take effect as a gift to the children of the initial beneficiary.

In effect, this means that if a parent leaves their child a gift in a Will and that child dies before the parent, leaving children of their own, then those children (the parent's grandchildren) will receive their parent's share.

That's the default position.

getmore4less

Section 33 of the wills act

 is the term you are looking for.

Fingers1234

So I strongly suspect (but who knows!) that the person concerned would not have deliberately left out the said children but this will was done many many years ago.  

Keep_pedalling

Fingers1234 said:

So I strongly suspect (but who knows!) that the person concerned would not have deliberately left out the said children but this will was done many many years ago.  

Does the testator have the mental capacity to make a new will if necessary? Very old wills often have clauses in them that are now obsolete and in some cases can be costly tax wise.

Fingers1234

Yes, they do have mental capacity.  That is an excellent point re clauses being obsolete.  Thank you

Mojisola

Keep_pedalling said:

Does the testator have the mental capacity to make a new will if necessary? Very old wills often have clauses in them that are now obsolete and in some cases can be costly tax wise.

And, if the grandchildren are still minors, the grandparents may want to name trustees to look after the inheritance until they come of age.

Brie

And the other beneficiaries could agree to a variation of the will to include the children.  Different country but my mom's will leaves everything to us kids split evenly between us.  But nothing to grandchildren if any of us siblings die before mom.  We siblings agree that things should be split evenly to children and spouses (in my case) should any of us pop off too soon.  

Savvy_Sue

Brie said:

And the other beneficiaries could agree to a variation of the will to include the children.  Different country but my mom's will leaves everything to us kids split evenly between us.  But nothing to grandchildren if any of us siblings die before mom.  We siblings agree that things should be split evenly to children and spouses (in my case) should any of us pop off too soon.  

Exactly what we agreed: explicit term in our parents' wills excluding the children of any pre-deceased beneficiaries, tacit agreement that we'd do a Deed of Variation if it became relevant. 

Savvy_Sue

One thing to be aware of in this situation is 'blended families'. As I understand it, Section 33 applies to 'direct issue', and that would include adopted children but not stepchildren who weren't direct descendants. This possibly isn't relevant, but you never know!

MobileSaver

Fingers1234 said:

So I strongly suspect (but who knows!) that the person concerned would not have deliberately left out the said children but this will was done many many years ago.  

I'm helping someone make a will right now and they are specifically excluding grandchildren should their own child pre-decease them; their rationale is that the (adult) grandchildren have never visited or shown any interest so they want their estate to only be shared amongst their own children still alive at the time.