View more on these topics

Blood simple

How the rules on intestacy and partial intestacy apply when the deceased leaves a spouse but no children

Last week, I looked at how, under English law, the intestacy prov- isions operate where a deceased leaves a spouse and issue. This week, I am going to look at how the provisions operate if a deceased leaves a spouse or civil partner and specified relatives but no issue. Being aware of these provisions in relation to those of your clients without issue is essential.

It would be understandable if the (childless) couple were to think that the survivor would inherit all – and, up to a given level, this would be true but for larger estates this may not be so.

As for all aspects of the intestacy provisions, where the couple own their residential home as joint tenants, the right of survivorship would ensure that the deceased’s interest in the property would pass automatically to the survivor outside of the intestacy provisions. Even if there were a will, property owned on a joint-tenancy basis would not be disposed of on death through the will as it would not form part of the deceased’s disposable estate. So let’s have a look at how the provisions would work.

Surviving spouse/ civil partner takes

i: All the personal chattels absolutely

ii: £450,000 (the statutory legacy) plus interest at 6 per cent

iii: One-half of the residuary estate

Specified relatives take

The remaining half of the residuary estates passes to:

i: Parents (in equal shares if more than one) and if neither survives

ii: Brothers and sisters, or issue of deceased brothers and sisters, in equal shares per stirpes

If the deceased has issue but no surviving spouse, then the intestacy provisions would probably deliver the result that the deceased would have wanted in that the deceased’s issue would take the entire estate absolutely subject to the statutory trusts (if appropriate).
Where there is no surviving spouse/civil partner or issue, then the specified relatives take the whole estate in the following order; and only if there is nobody in a prior class will the next class benefit:

  • parents,
  • brothers and sisters of the whole blood,
  • bothers and sisters of the half blood,
  • grandparents,
  • uncles and aunts of the whole blood, and
  • uncles and aunts of the half blood.

The classes above, except parents and grandparents, take subject to the statutory trusts which provide for the issue of a deceased member of the class to take his share.

In the absence of all the above, the Crown, Duchy of Lancaster or the Duchy of Cornwall, as appropriate, takes the whole estate as bona vacantia.

Before looking at what the statutory trusts provide, I will consider what happens if there is a partial intestacy.

The term partial intestacy refers to a situation where an individual leaves a will which does not dispose of the whole of the estate.

This could occur where not all the assets are covered by the will or where a beneficiary under a will disclaims his or her interest under the will.
A partial intestacy may also arise where the residuary beneficiary under the will dies first.

The above-mentioned rules of intestacy apply equally to partial intestacy. That is, to the extent that the will does not deal with particular assets, the above rules will apply as if the estate subject to intestacy was self-contained.

Where an individual dies partially testate and partially intestate, the dispositions in the will are effected first and the personal representatives then deal with the undisposed property under the partial intestacy.

Until the Law Reform (Succession) Act 1995, the hotchpotch rules applied which meant the issue and the surviving spouse had to bring into account the value of certain beneficial interests received under the will in determining their entitle- ment on intestacy. The 1995 Act (section 1(2)) abolished the hotchpotch rules in respect of partial intestacy for issue and spouses.

The abolition of the hotchpotch rules means that where there is partial intestacy, a beneficiary will not have his or her fixed net sum under the intestacy rules cut down by the value of any interest she or he takes under the will.

The same applies to children’s entitlements on an intestacy.

For example, where there are two children and there is a will which disposes of half of the estate only, leaving it all to one child, the undisposed half of the estate will be divided equally between the two children, with the result that one child takes three-quarters of the estate and the other one-quarter.

Under the old hotchpotch rules, the child who benefited under the will would have to bring his share into hotchpotch as part of his equal share under intestacy so that the result would be that the whole of the estate would be split equally between the two.
Although the latter might seem fairer, it might not have been in accordance with the testator’s wishes.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment