Interpretation of NRB Legacy

(Tobias Gleed-Owen) #1

We are dealing with a Will (not drafted by our firm) containing the following legacy:

“I give to them my children A, B and C in equal shares such maximum sum whether it be cash monies at Savings Accounts Bank Accounts or Building Society Accounts or from the proceeds of sale of any land or shares as may be transferred by me at the date of my death free of Inheritance Tax or any other Capital Tax chargeable at my death.”

I would be grateful for members’ views on whether this legacy includes relievable business assets.

I am led to believe that this was not the testator’s intention, and the words following “whether it be” suggest to me that the legacy is limited to those sources (i.e. cash)

Tobias Gleed-Owen
Hewitsons LLP

(Paul Saunders) #2

The problem with “whether it be” is that it could be a limitation, or an indicator of elements of a larger range (e.g. I like working around the house, whether it be gardening, cooking or painting).

To my mind, the words are more likely to be intended as words of limitation, provided that the testator also owned “relievable business assets” when he made his will. If he did not own such assets at that time, could he reasonably have had it in mind that they be excluded?

I suggest the will instructions be reviewed to see if they give any indication of the intended context of the words.

Depending upon how much is involved, it may be appropriate to obtain counsel’s opinion. Alternatively, if all the beneficiaries can agree an interpretation, consideration might be given to them entering into a variation to confirm the mutual understanding.

Paul Saunders

(Maxine Higgins) #3

Without knowing what else, if anything, the Will says - and as a non-legal lay person - the wording “such maximum share … as may be transferred by me … free of IHT or any other capital tax” combined with the words “from the proceeds of sale of any land or shares” suggests to me that once the IHT has been calculated after any relief for business assets etc., the whole estate is to be liquidated into cash and that cash divided between his children… (or is that being too simplistic?).

Maxine Higgins
Citroen Wells

(malcfinney1) #4

I wouldn’t place too much emphasis (if any !) on my view but it seems to me that “whether it be….” potentially encompasses any part of the deceased’s estate at the time of his death and is not restricted to the particular types of property listed (in my view simply by way of example). The restriction as to the property which may be left to A, B and C is simply to the property in the deceased’s estate which can be left free of tax.

Hence, business property qualifying for BPR is I believe included.

Malcolm Finney