DoVs always seem to create wide interest and discussion amongst TDF members. As fast as I think I have grasped the concept I have to re-visit my understanding.
Below, I attempt to respond to Julian’s last post and in the light of the earlier posts.
I think there is general agreement that a deceased’s joint beneficial interest in property passes by survivorship to the remaining surviving joint tenant; both legal and beneficial interests are then held by the surviving joint tenant absolutely and the previous trust automatically disappears.
A DoV represents a change in the devolution of the deceased’s property compared to how it would otherwise have devolved. It appears to be accepted that a DoV may be executed under which the joint beneficial interest is to be treated as having been severed prior to death. The resulting deceased’s interest, now as tenant in common, is to be then held qua trustee by the surviving tenant for those to whom that interest is to be redirected under the DoV.
In the real world as severance is not possible post death, to implement the terms of the DoV (ie re-direction) it would seem to require that the surviving tenant declares that he holds the legal title in trust for himself and those beneficiaries to whom a redirection has been made.
Has the DoV itself effected severance? In the real world it would seem not.
Until the surviving tenant declares the trust referred to above no deprivation in the real world has occurred. Once the trust is declared effectively severance occurs and the surviving tenant is voluntarily disposing of an interest which constitutes the deprivation.
Re Diana’s point I would have thought that the DoV is not in fact carrying out the deceased’s wishes. Prima facie, the deceased as joint tenant is aware that the survivor automatically inherits and under the DoV someone other than the survivor inherits. Unless, the view is taken that the deceased according to his beneficiaries was not aware of the survivorship rule and the DoV simply attempts to ensure that those who do inherit are those who the deceased had intended to inherit.