What happens when beneficiaries die before they have a chance to inherit? (via Irish Times)

An interesting question posed in the Irish Times:

Q&A: Rules of intestacy come into play in absence of clear instructions in wills

https://www.irishtimes.com/business/personal-finance/what-happens-when-beneficiaries-die-before-they-have-a-chance-to-inherit-1.4814322?localLinksEnabled=false

By Dominic Coyle

I wonder if you could throw some light on a query please. A testator has named three beneficiaries in a will. Let’s call them A, B and C with equal shares to the estate. A and B are bachelors, C is married with a family.

In the will, it specifically states that, should C predecease the testator, her share goes to her family. There is no specifications in the will in this regard for A and B. It turns out A, B and C have predeceased the testator.

My query is who are now the beneficiaries. Just to mention that A, B and C were siblings and they have other deceased and living siblings.

Ms GC, email

There’s one key bit of information you don’t give here. Is the testator – the person whose will we are discussing – a parent of these three people or not? I’m going to assume they are but it could have a bearing on what happens to the estate as I will explain later.

It is certainly an unlucky family. To lose three children in your lifetime is not something that you would wish on anyone. It’s also slightly unusual in that there are other family and no effort was made to change the will as intended beneficiaries died.

As an aside, as you will see below, it does serve to emphasise how important it is to draft a will carefully to ensure your estate is distributed as you intended. I’ve no idea what the assets are in this case but if they were, say, a farm or other physical property, there might be good reason why the person wanted a limited number of beneficiaries – or even specific ones, maybe those who had cared for them in their latter years.

In any case, as you suspect, the position will be different for C, the intended beneficiary who was married, and the other two people. In her case, the will specifically guides that her one-third share of the estate should pass to her own family which is fairly clear cut.

Bachelor brothers
But what then of the shares to the bachelor brothers – A and B? This is where timing becomes an issue. In this case, it appears that the two brothers died before the person who intended them to share the estate. If they had died after that person – the testator – but before the affairs of the estate were completed in probate, the position would be very different.

Who inherits, in what circumstances and order, is determined by the Succession Act, a piece of legislation dating back to 1965.

Specifically, in this case, it sets down what happens when a beneficiary dies before the person who has drawn up the will. The basic rule is that what they were going to receive goes back into the residue of the estate unless there is a specific alternate beneficiary named.

In the case of C, an alternate is named and that is why her share goes to her family. For the other two, no residuary is named and so the one-third they were due to get goes back into the residue. Even if the two men had wills of their own and had provided in those wills for this expected inheritance, the benefit never comes to them because they have predeceased the testator.

“Under the rules of intestacy, where the estate goes depends on who survives the dead person and their relationship to them”

In any case, they predeceased the testator, so their share goes back into the pot, so to speak. But what happens then?

Well, in the absence of alternate beneficiaries (as with C’s share), the rules of intestacy come into play. And this is where the relationship between the person making the will and the beneficiaries can become important.

Under the rules of intestacy, where the estate goes depends on who survives the dead person and their relationship to them.

First up, if there is a spouse or civil partner and no children, they get everything. If there is a spouse/civil partner and children, then the spouse/civil partner gets two-thirds of the estate and the children share the remaining one-third.

If there are children but no spouse or civil partner surviving, then those children share the estate equally.

Importantly, this is all the children, not just some of them regardless of what the will said. And, if one or more of the children has died, their share goes to their own children – ie the grandchildren of the testator.

So, if I am correct in assuming this person is the parent of A,B and C, and these other deceased and surviving children, the estate will be distributed equally between all the children, with the share of the deceased children going to their children if they have any.

If they don’t, as may well be the case of the bachelor brothers here, the estate is divided among those children living and those who have died but have offspring.

But what if the testator is not a parent but an uncle or aunt of A, B and C as could be common enough in certain parts of the country?

That changes things. Under the rules of intestacy, if this person had no children of their own or a spouse/civil partner, their estate is divided among their own brothers and sisters. This might not be A, B, C or those three people’s other siblings.

And if they had no surviving brothers or sisters, children or spouse/civil partner, then the whole estate – or the two-thirds we are discussing here because C’s family retains its one-third share regardless – is divided equally among nieces and nephews.

The interesting thing here is that it will only be surviving nephews and nieces who benefit: at this level, there is no provision for the children of dead nieces or nephews to inherit.

The same is true if this family are a more distant relation of the person whose will we are discussing – say cousins or some such.

Finally, if they are not blood relatives at all, none of them will benefit and the two-thirds of the estate that had originally been due to go to the bachelors A and B will instead go to the State.

So, you see, what happens here is very much dependent on the relationship between this will’s author and what I presume is your family.

Please send your queries to Dominic Coyle, Q&A, The Irish Times, 24-28 Tara Street, Dublin 2, or by email to dcoyle@irishtimes.com. This column is a reader service and is not intended to replace professional advice.

Leave a Reply

Your email address will not be published. Required fields are marked *