Legacy OR percentage

Hello, I have a client who wants to include EITHER £20,000, OR 5% of residue (whichever is the lesser amount).
I cannot find a precedent clause anywhere that will work. Can anyone help me please?
Thanks in advance.

Residue will be calculated after deducting pecuniary legacies so the main cautionary point will be to define “Residue” in the clause in the alternative to be either before (which is more logical) or after deducting the £20,000, whichever is intended. It also seems to raise the spectre of valuing all the assets comprising residue and specifying a valuation date. That valuation might be necessary in any event but is not always. It will not be possible to settle the legacy until residue has been ascertained, which may or may not delay that. As the maximum gift is £20000 it might be advisable to oblige the legatee to accept the PRs’ valuations to avoid costs.

Jack Harper

Thanks so much Jack.

In this situation I have usually simply included an ordinary legacy of £20,000 and also a legacy of 19 x £20,000 (£380,000) to the intended residuary beneficiary, and made sure both legacies rank equally for abatement, and then also named the residuary beneficiary in the residue clause.
Then if the death estate is less than £400,000 then the legacies will abate and effectively the legatee will get the equivalent of 5% of the estate, whereas if the estate is more than £400,000 the legatee will only get £5000 and the rest will go to the other beneficiary.

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This is a clever idea - thank you!

What a clever idea - thank you!

Not sure if you have Williams on Wills. Form B10.55: Clause providing for reduction of legacies where the testator’s estate proves to have decreased in value seems to be the clause you need.

Best wishes