Will: a legal way to secure properties or estates for your loved ones.



Leaving a valid will is always crucial to secure your properties and estates for your loved ones. There are certain legal requirements for a will to be valid. You must seek legal advice before leaving a will for your loved ones. When a person dies, it is necessary to consider two key issues before you can ascertain how and to whom their estate will pass.

==> Whether the deceased died testate or intestate. This determines whether the intestacy rules or a will are followed when distributing the deceased’s assets to beneficiaries.

==> The nature of the assets owned by the deceased. Assets capable of passing under a will or by intestacy are referred to collectively as the deceased’s succession estate or distribution estate. A number of assets are excluded from the succession estate and are distributed in accordance with their own specific rules.

Testate / Intestate:
A person who makes a will is called a testator. If the deceased made a valid will, he/she has died testate. The terms of the will determine who inherits the succession estate.

If the deceased died without making a valid will he/she has died intestate. In this case, statutory provisions in the Administration of Estates Act 1925 (‘AEA’), as amended by the Inheritance and Trustees’ Powers Act 2014 (‘ITPA’), referred to as the intestacy rules, apply to determine who inherits the succession estate and what each beneficiary receives.

If the deceased made a valid will, but the terms of the will do not dispose of all of the succession estates, the deceased has died partially intestate. In this case, the will is followed, but any property that remains undisposed passes in accordance with the intestacy rules. Partial intestacy often arises as a result of poor will drafting rather than intentionally.

Identifying the succession estate:
A person’s succession estate comprises all of their assets which pass by either a will or the intestacy rules. The succession estate passes into the hands of the deceased’s personal representatives (‘PRs’), who are legally responsible for administering the estate. Out of the succession estate the PRs generally pay the deceased’s debts, funeral and other administrative expenses. The remaining assets are then distributed according to the order of priority under the intestacy rules or the terms of the will.

To identify precisely what assets comprise the estate for succession/distribution purposes, it is easier to identify property that is specifically excluded. If an asset is not specifically excluded, then it will be within the succession estate.

The following six types of asset are, or maybe, excluded from the succession estate:

· · Property held as joint tenants
· · Insurance policies written in trust
· · Pension benefits
· · Statutory nominations
· · Donatio mortis causa (‘DMC’)
· · Trusts /Settlements.

Intestacy:
If a person dies wholly or partially intestate, their succession estate, or part of it, will be distributed in accordance with the intestacy rules.

Entitlement to the estate:

Whether or not a person inherits from an intestate depends on the family relationship. The main categories of a beneficiary are the intestate’s surviving spouse/civil partner and issue. The issue means children and remoter linear descendants.

The issue includes those who are legitimate (born to married parents), illegitimate (born to unmarried parents), legitimated (born to unmarried parents who later marry), and adopted children.

Note that for a spouse or civil partner to inherit, they must survive the intestate by at least 28 days.

Distribution where an intestate die without leaving spouse or issue
If the intestate dies and is not survived by a spouse or issue, the statutory order of entitlement to the intestate’s succession estate applies as follows:
· · to parents, but if none;
· · to siblings of whole blood (share both parents with intestate) on the statutory trust, but if none;
· · to siblings of half-blood (share one parent with intestate) on the statutory trusts, but if none;
· · to grandparents, but if none;
· · to uncles and aunts of whole blood (whole blood siblings of a parent of the intestate) on the statutory trusts, but if none;
· · to uncles and aunts of half-blood (half-blood siblings of a parent of the intestate) on the statutory trusts, but if none;
· · to the crown as bona vacantia.

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