If you leave a gift to someone who is not your issue (child or grandchild or greatgrandchild etc.) and the person concerned dies before you die, then the gift will lapse unless you have instructed that there should be a gift over. Here is a simple example. I give £1000 to my friend John Patrick Smith but if he dies before me I give this gift instead to my friend Janet Petula Brown.
The situation is different if you leave a gift to your issue. The gift to issue does not lapse if the intended beneficiary has issue. For example: I give 50% of my estate to my son Anthony Donaldson and 50% of my estate to my daughter Belinda Donaldson. Anthony has two children. If Anthony should die before me then because of section 33 of the Wills Act 1837, Anthony’s share will go to Anthony’s children. Often this gives the desired effect.
However, it might be that one of Anthony’s children has become estranged and I would not want this estranged child to benefit from my estate. In such a situation section 33 would not give me my desired distribution.
A further example of where section 33 can cause a problem is where Anthony has children and stepchildren. I might consider them all to be “my grandchildren” but section 33 will differentiate between them. If Anthony has one child and four stepchildren then his one child will receive his share and the four stepchildren will receive nothing.
Section 33 can be excluded from a Will and it can be nullified by the use of a gift over but if you are not aware of how it works there can be some unintended and sometimes unwelcome consequences.
If you need further advice on this matter or would like one of our consultants to visit, please click here or telephone us on 01732 868190.