Substitution gift in Will in favour of grandchildren


(saraharundel) #1

Standard family Will. On second death standard clause says along the lines of:

‘ I leave my residuary estate to be divided equally between my children or to the survivor(s) of them provided that if either/any of them die before me of before attaining a vested interest leaving a children or children of their own such child or children will that the share of their deceased parent and if more than in equal shares’

T want whole estate to end up with grandchild/ren if all children have predeceased.

But…. what happens if one child does not have any children and all of T’s children predecease T?

I don’t think the above clause would leave the estate to the children of the other deceased child of T. No child has survived T and therefore is it only the share of the parent of the grandchild would pass to grandchildren , leaving the share of the deceased child with no children of his/her own passing under a substitution provision or under the Intestacy rules? The intestacy rules may save the other share and under them the grandchildren would probably inherit, but what if it was a second marriage for T, and T had a surviving spouse ( step mum or dad to T’s children) who would potentially inherit under the intestacy rules?

I don’t think S.33 would save the situation.

It may be possible to run a successful construction argument and take a robust approach - not sure I would want to be the test case though.

Any thoughts welcome - I hope I am just being over cautious!

Sarah Arundel
Taylor Fawcett


(Paul Saunders) #2

You need to break the clause down into its various elements

  1.   Gift to children “to be divided equally between (them) or to the survivor of them”
    
  2.   “provided that if either/any of them die before me or before attaining a vested interest leaving a children (sic) or children of their own such child or children will (take) that share of their deceased parent and if more than (one) in equal shares”
    

In the absence of any direction that the estate is to be divided other than upon the death of T:

A. The children’s interests vest on the date of death

B. the estate is to be divided between those children who survive T

C. only should any children who died (or are deemed to have died) before T leave children of their own (who benefit under the second limb) does the deceased child’s share exist - to be shared between their own children.

On the above analysis, if all of T’s children predecease T, the estate will be shared by the grandchildren who survive T, on a stirpital basis The clause does not cause the engagement of any of the rules of intestacy (within England & Wales).

Paul Saunders


(andrew.goodman) #3

I tend to agree with you. Practical Will Precedents solve the problem with a few additional words, being:

"take the share of the Trust Fund which such child would have taken had that child survived me

It creates the temporary fiction that the child survived the deceased so received the entire trust fund and ensuring that the entire trust fund accrues to their own children. It would work here if you changed the final words to:

“will take the share of their deceased parent which such deceased parent would have taken had they survived me and if more than in equal shares”

(admittedly clunky using “deceased parent”).

Andrew Goodman
Osborne Clarke LLP


(Kaskar) #4

If the clause is phrased
" My Trustees shall hold my residuary estate for such of my children as shall survive me and if more than one then in equal shares absolutely PROVIDED THAT if any child shall predecease me leaving children then those children shall take the share which my deceased would have taken if he had survived me and if more than one then in equal shares"
This should then solve the problem highlighted by you. Hope this helps.

Ruksana Kaskar
Hamilton Davies LLP


(chris.wallworth) #5

Questions about the interpretation of clauses such as this invariably arise because of the antique language used. If the provision is written in modern English it is perfectly clear even to the non-lawyer:

“To divide the residue equally between those of my children [NAMES] who survive me. If any of them has died leaving children, then those children who attain the age of 25 shall take their parent’s share equally.”

Chris Wallworth
Ferguson Bricknell


(Vincent Oakley) #6

With increasing life expectancy the risk of a child predeceasing has increased. To compound this problem there is also a risk that both a child and that child’s own child will predecease the testator but will leave issue.

To add more complications there are risks that a potential beneficiary (either child or remoter descendant) will not predecease the testator but will fail to reach the qualifying age – say 25 and will leave issue, who may or may not reach the qualifying age.

The learned authors of Williams on Wills at 10 Old Square, Lincolns Inn considered these issues in detail between the 9th and 10th editions. The wording of the tenth edition has been substantially altered to reflect their thoughts.

For example, Williams on Wills, Volume 2 Precedents and Statutes, Section C Precedent C2.1 : Reciprocal Wills giving entire estate to spouse absolutely, with alternative gift to children and remoter descendants has been changed:

Ninth Edition
Beneficial trusts for issue
7. My trustees shall hold my residuary estate and the income thereof upon trust for such of my children [by my [wife/husband]] as shall survive me and attain the age of [18/25] years and if more than one in equal shares Provided that if any such child shall die before attaining a vested interest under the foregoing trust leaving a child or children living at or born after my death who shall attain the age of [18/21] years [or marry or form a civil partnership under that age] then such last-mentioned child or children shall take and if more than one equally between them the share of my residuary estate which their deceased parent would have taken had he or she lived to attain a vested interest.

New Version in the Tenth Edition
Beneficial trusts for descendants if the trust for the spouse fails
6.
(1) If my [wife/husband] shall predecease me or if the foregoing trust shall fail for any other reason then my trustees shall hold my residuary estate and the income thereof upon trust for such of my children [by my [wife/husband] ] as shall survive me and attain the age of [18/25] years and if more than one in equal shares;
(2) provided that if any child of mine [by my [wife/husband]] shall not attain a vested interest under the foregoing trust then any children or remoter descendants of him or her living at or born not more than [25] years after my death who shall attain the age of [18/25] years or shall be living but under that age at the expiry of [25] years from my death shall take and if more than one equally through all degrees according to their stocks the share of my residuary estate which such child of mine would have taken if he or she had attained a vested interest and so that no child or remoter descendant of a child of mine shall take whose parent or remoter ancestor attains a vested interest and section 33 of the Wills Act 1837 shall not apply to the foregoing trusts.
Please note there are different precedents in Section 3 Wills for married couples …with ADULT children.

Vincent Oakley