Intestacy & Succession

Question 2

What are the two key issues to consider when ascertaining how a deceased’s estate will pass?

Answer 2

1. Whether the deceased left a valid will
2. The nature of the assets owned by the deceased

The will determines distribution if valid, otherwise intestacy rules apply.

Question 3

What is a ‘testator’?

Answer 3

A person who has left a valid will determining asset distribution

This term is used when the deceased’s will is valid and covers their entire succession estate.

Question 4

What does it mean when a deceased is considered ‘partially intestate’?

Answer 4

When there is a valid will in place, but it does not cover the entire estate

This often arises from poor will drafting.

Question 5

What is the most common cause of ‘partial intestacy’?

Answer 5

Poor will drafting.

Question 6

What does it mean when a person dies ‘intestate’?

Answer 6

When a person dies without making a valid will.

Question 7

What are the consequences of dying intestate?

Answer 7

The intestacy rules apply to determine who inherits and what each beneficiary receives.

Question 8

What is referred to as the deceased’s ‘succession estate’?

Answer 8

Assets capable of passing under a will or by intestacy.

Question 9

Name some types of property that do not form part of the succession estate.

Answer 9

• Donationes mortis causa
• Discretionary pension scheme benefits
• Insurance policies written in trust
• Statutory nominations
• Property held as beneficial joint tenants
• Some other beneficial interests under trusts.

Question 10

What is a Donationes Mortis Causa (DMC)?

Answer 10

A gift made in contemplation of death with specific requirements.

Question 11

What are the three requirements for a valid DMC?

Answer 11

• The gift is made because the donor believes they may die imminently
• The gift is conditional upon the donor dying
• The donor parts with the property or something representing ownership.

Question 12

What happens to the proceeds of a simple life insurance policy upon the death of the insured?

Answer 12

The proceeds pass to the succession estate.

Question 13

What happens to the proceeds of an insurance policy written in trust?

Answer 13

The proceeds do not form part of the succession estate and belong to the nominated beneficiaries.

Question 14

What is a statutory nomination?

Answer 14

Where an individual nominates an amount (not exceeding £5,000) to be passed to someone rather than under the will or intestacy.

Question 15

What happens to property held as beneficial joint tenants upon the death of a tenant?

Answer 15

The property automatically passes to the other joint tenant(s) by survivorship.

Question 16

What is the difference between joint tenants and tenants in common?

Answer 16

• Joint tenants: property passes by survivorship
• Tenants in common: separate, divisible share that passes into the succession estate.

Question 17

What is the significance of the family home in terms of beneficial co-ownership?

Answer 17

Typically the most valuable property owned jointly, can be held as joint tenants or tenants in common.

Question 18

What does the term ‘issue’ refer to in intestacy rules?

Answer 18

Children and grandchildren, including adopted children and children conceived but not yet born.

Question 19

Under the intestacy rules, what happens if the intestate leaves a spouse but no issue?

Answer 19

The spouse inherits the entire succession estate absolutely.

Question 20

What must a surviving spouse do to inherit under intestacy rules?

Answer 20

Survive the deceased by at least 28 days.

Question 21

What is the statutory legacy amount under intestacy rules?

Answer 21

£322,000 free of tax and costs plus interest from the date of death.

Question 22

What is the entitlement of issue when an intestate leaves a spouse and issue?

Answer 22

Half of the residue estate (if any) on the statutory trusts.

Question 23

What is the ‘contingency limb’ in statutory trusts?

Answer 23

Each entitled beneficiary must survive the intestate and reach 18 years old to inherit.

Question 24

What is the statutory trust?

Answer 24

A legal arrangement where the estate is distributed according to statutory rules in the absence of a will.

Question 25

Define the 'Contingency Limb' in statutory trusts.

Answer 25

Each entitled beneficiary must survive the intestate and reach the age of 18 to inherit.

Question 26

What happens if a beneficiary is 18 or older when the intestate dies?

Answer 26

They inherit absolutely and immediately, having a vested interest.

Question 27

What is the 'Substitution Limb' in statutory trusts?

Answer 27

If an entitled beneficiary dies before the intestate, their issue can inherit in their place, provided they satisfy the contingency limb.

Question 28

True or False: A beneficiary must survive the intestate by 28 days to inherit.

Answer 28

False.

Question 29

What is the entitlement of a spouse under intestacy rules?

Answer 29

The spouse inherits the entire estate if there are no children. If there is children, the spouse inherits £322,000, personal chattels and half of the residue estate.

Question 30

What is the position if an intestate leaves no spouse but has a child aged 18?

Answer 30

The child inherits the entire estate with a vested interest.

Question 31

What occurs if a child is under 18 at the time of the intestate's death?

Answer 31

The child has a contingent interest until they reach the age of 18.

Question 32

How is the estate divided if the intestate is survived by two children, one aged 18 and the other aged 14?

Answer 32

The 18-year-old has a vested interest in half of the estate; the 14-year-old has a contingent interest in the other half.

Question 33

What is the total entitlement of a spouse if the estate is worth £530,000, including personal chattels worth £10,000?

Answer 33

Spouse receives £10,000 (personal chattels) + £322,000 (statutory legacy) + £99,000 (half of the residue).

Question 34

If an intestate has no spouse or issue, who inherits first according to section 46 AEA 1925?

Answer 34

Parents inherit first.

Question 35

True or False: Siblings of half blood rank higher than grandparents under intestacy rules.

Answer 35

False.

Question 36

What happens if both parents survive the intestate and the deceased leaves no spouse or issue?

Answer 36

The estate is divided equally between the parents.

Question 37

What is the order of entitlement if an intestate is survived by siblings only?

Answer 37

Siblings of whole blood, then siblings of half blood.

Question 38

How do grandchildren inherit if their parent predeceased the intestate?

Answer 38

They inherit via the substitution limb.

Question 39

What is the distribution process if the intestate leaves a spouse and children?

Answer 39

Step 1: Determine spouse's entitlement - (£322,000, Personal Chattels & half of the residue, if any) Step 2: Determine children's entitlement. (half of the residue split in equal parts between children)

Question 40

Calculate the total assets received by a spouse where an intestate dies leaving a surviving spouse, 3 surviving children and a net estate is £579,000 including personal chattels worth £5,000.

Answer 40

£5,000 (personal chattels) + £322,000 (statutory legacy) + £126,000 (half of the residue) = £453,000.

Question 41

How is the residue estate divided among three children if the spouse's share is accounted for?

Answer 41

Each child receives an interest in one third of the remaining residue.

Question 42

What is the definition of 'personal chattels' according to s55 AEA 1925?

Answer 42

Tangible movable property excluding certain items ## Footnote Exclusions include money, business property, and investment property.

Question 43

What must the surviving spouse do to appropriate the marital home?

Answer 43

Make an election in writing to the personal representatives within 12 months ## Footnote This election allows the spouse to buy the deceased's share.

Question 44

What is required if the spouse's estate entitlement is lower than the value of the home they are appropriating?

Answer 44

The spouse must pay the difference from their personal funds ## Footnote This applies when the home is the only or main asset of the estate.

Question 45

What is the highest ranking class of relatives under intestacy rules?

Answer 45

Deceased spouse and issue ## Footnote This class has the first claim on the estate.

Question 46

If a deceased left a spouse but no issue, who inherits the estate?

Answer 46

The spouse inherits the estate ## Footnote This is applicable when there are no children or descendants.

Question 47

What happens if the deceased left issue but no spouse?

Answer 47

The issue inherit the estate on the statutory trusts ## Footnote This means they inherit according to specified legal guidelines.

Question 48

What rights does a spouse have regarding the marital home under intestacy rules?

Answer 48

A statutory right to appropriate the marital home ## Footnote This allows the spouse to claim the home in satisfaction of their entitlement.

Question 49

What is the time frame for a spouse to elect for appropriation of the marital home?

Answer 49

12 months from the date of the grant ## Footnote This is the deadline for notifying the personal representatives.

Question 50

True or False: The personal representatives can sell the marital home without the spouse's consent during the election period.

Answer 50

False ## Footnote The personal representatives cannot normally sell the home without consent during this time.

Question 51

With reference to appropriation of the marital home, what happens if the marital home is part of a larger building or a farm?

Answer 51

Consent of the court is required for appropriation ## Footnote This restriction applies to shared or business properties.

Question 52

'A' dies intestate, leaving an estate worth £500,000. A leaves no spouse but is survived by daughter, B (50). A’s son, C died last year, leaving a son, D (16). What is the position re the intestacy rules and who inherits what amount?

Answer 52

Daughter(B) - Entitled to half of the residue estate (£250,000). Grandson (D) - inherits Son/C’s share of the residue (£250,000) via the substitution limb. D’s interest is contingent on reaching age 18.

Question 53

'A' dies intestate, leaving an estate worth £500,000. A leaves no spouse but is survived by her sons, B (18) and C (14). What is the position under the intestacy rules?

Answer 53

B and C share £250,000 each on the statutory trusts. B’s interest has vested. C’s interest is contingent upon reaching age 18.

Question 53

A dies intestate, leaving an estate worth £500,000. A leaves no spouse but is survived by her father, F (70) and daughter, D (14). What is the position under the intestacy rules?

Answer 53

D would inherit A’s entire estate under the intestacy rules but D’s interest is contingent upon reaching age 18.

Question 54

Under the intestacy rules, what would happen if an intestate’s surviving spouse died 2 weeks after their intestate spouse?

Answer 54

The intestacy rules apply as if the deceased was not survived by their spouse. ## Footnote This means the spouse has no entitlement under the intestacy rules and therefore cannot pass their interest to their own estate.

Question 55

If the deceased died partially intestate what determines what happens to their estate?

Answer 55

The will applies where possible and any remaining property is dealt with under the intestacy rules.

Question 56

If the deceased died intestate, what determines what happens to their estate?

Answer 56

The intestacy rules apply.