I have the following short clause in a Will and querying whether it is a simple Life Interest or in fact a Right to Occupy:
“I give my interest in the freehold possession known as ADDRESS unto PARTNER OF DECEASED for her life she paying all taxes and other outgoings and keeping the same in good repair and insured against all reasonable risks to the full value thereof as my Trustees shall approve and from And after the death of the said PARTNER OF DECEASED I give the same unto my two children X and Y in equal shares absolutely.”
The partner of deceased already has a 1/3rd interest in the property (held as tenants in common). The residue is split three ways between partner of deceased and the two children.
On balance I feel this is a life interest trust but the clause is silent as to the right of the life tenant to receive any income which has caused me to question it.
Separately if one of the two children should predecease the life tenant, am I correct in thinking that this would result in a partial intestacy? There is no accruer clause so I presume it would not automatically pass to the surviving child of the two and that it would not pass to the estate of that then deceased child?
The property is given to the partner for life and, upon their death to the testator’s 2 named children.
It seems to me a “conventional” life interest and, if the property is sold, I consider the partner will have a continuing life interest in the proceeds.
As regards the gift over on the death of the partner, there are no words of survivorship and so the gift of the remainder will vest in X and Y as at the date of the testator’s death. If either (or both) of X and Y die before the life interest terminates, their interest in remainder will pass into their individual estates.
Whilst I agree with Simon that it is a trust of land, and upon a sale of the property interest the trust would cease to be a trust of land, it is not clear to me why such a sale would necessarily bring the trust to an end.
The gift of the property interest is to the partner “for her life”, rather than for her occupation or residence.
A gift of, say, specified shares “for her life” would not normally terminate upon a disposal of all or any of those shares, and I do not quite understand why a gift of a property should be any different.
If I have overlooked something fundamental, I am happy to be enlightened.
My hesitation here relates to the property specific nature of the wording of the trust. It is clear to me that the testator (and unfortunately also the draftsman) does not contemplate the possibility of the sale of the property during the partner’s lifetime. If this was a trust of a chattel in similar wording, I would not necessarily consider the trust would apply to the proceeds of sale on a future sale.
Therefore, notwithstanding it is stated as being for life, I think it is arguable it only applies so long as the property is owned. If it is agreed there is some doubt, then this could be rectified by a deed of variation, if within 2 years of the death and the children are willing. If not, the partner will have to ensure the property is not sold during her lifetime, particularly if she wants to claim the RNRB in both her interests in the property, as the downsizing provisions will not apply on a sale of the trust interest.