We are currently dealing with an estate where the Will provides for the deceased’s property to pass to X, his vehicle to Y and then several pecuniary legacies. There are insufficient funds to cover the pecuniary legacies. The beneficiaries of the property and vehicle are also included in the pecuniary legacy list.
The property has been transferred into X’s name and the vehicle has been transferred to Y.
As there are insufficient funds to cover the pecuniary legacies, they will need to be paid on a pro-rata basis.
My question is, does X and Y receive the full value of the property and vehicle respectively, or do the specific legacies get reduced down as well (hence what they receive in lieu of their pecuniary legacy will be much smaller as they have already received the full value of the specific legacy), or do they receive the specific legacies at their full value and all of the pecuniary legacies get reduced down accordingly, or do the pecuniary legacies get paid in full and the value of the specific legacies get reduced down?
We have looked at the Administration of Estates Act 1925 First Schedule Part II and are divided on opinion.
Any guidance would be gratefully received.
Harold Bell Infields & Co