WRITING A WILL - A COMPLETE GUIDE

Intestacy Laws - What happens when there is no will

As the intestacy law stands, if a person dies without a will and leaves a child or other issue, then such person(s) will benefit from the realisation of all investments, property, etc on reaching the age of 18. If he or she is not 18, then the share is held in trust until the child reaches the age of majority, when usually he or she is able to receive it. However, the trustees may, in certain circumstances, advance monies from the trust for the purpose of 'maintenance, education or advancement of the child'. When the child eventually receives the trust's estate it should include any interest earned on the money.

It cannot be stressed too often that the prime importance of making a will is that you are able to specify whom you wish to deal with your affairs and to whom you wish to leave your estate. If you do not make a will and you die leaving no traceable relatives, your estate will go to the Crown and will form part of government funds. By making a will and appointing an executor, one of the advantages is the flexibility allowed to that executor to move money around in a variable market in order to make the safest investment for your appointed heirs.

If an executor has not been appointed in a will, or if a will has not been made out, then the deceased's property, including personal belongings, will be administered by a personal representative. This representative is appointed by the Probate Registry in accordance with strict rules of priority These rules state that a spouse has the first right to be appointed to administer the deceased's estate. But if the surviving spouse does not feel willing or able to handle the job, the couple's children may be appointed to act on their parent's behalf. When there is no surviving spouse or children then the task of administering the estate can fall on close relatives, ie parents, brothers, sisters or their issue. A close friend may be appointed attorney by the person entitled to act and, if suitable, will be appointed administrator, although this does not often happen.

Whoever is appointed has a duty to administer the estate to see that, where necessary, the assets are sold at the best possible price and any debts and expenses paid off. Once that has been done, distribution takes place in accordance with the Administration of Estates Act. This Act governs the distribution of an estate when the deceased has died intestate. Under the Act, if you were the appointed representative, you would have the power to deal with the estate as you thought fit in order to safeguard the assets. Of course, you are accountable for your actions.

You can claim administrative costs and out-of-pocket expenses from the estate, such as stamps, telephone calls and so on. Also, if you have had to forfeit a day's pay in attending to estate affairs you can reclaim the amount of pay lost, but you cannot charge for your time.

After letters of administration have been granted by the Probate Registry and once all debts and expenses have been paid distribution can take place. Again, there is an order of priority.

If there is a surviving spouse and issue, the spouse receives all the deceased's personal items (known as,personal effects) together with a sum up to the value of the statutory legacy which is £125,000. Should the value of the estate exceed this and there is also issue, then the surviving spouse would receive half of the balance of the estate for life. In other words, the half of what remains after the personal effects, the statutory legacy of £125,000, and debts and expenses have been deducted. The remaining half would go to any children immediately, except if they are under the age of 18. If any child did die in the lifetime of the deceased leaving children of his or her own, then those children would divide their parent's share between them.

On the death of the surviving spouse the half of the estate which he or she has had a life interest in would pass to the children. Therefore, it is important to understand fully what life interest means. Life interest could be described as borrowed ownership in that you have the right to use the interest from the capital but cannot touch the capital as it does not legally belong to you. Upon death, the life interest passes to the other beneficiaries, for example the children, and is divided up equally for their benefit. Again, if any children of the deceased died in his or her lifetime leaving children of their own, then the same applies as in the above paragraph.

When children are the nearest surviving relatives of the deceased, the estate passes to them or, if some have already died leaving children of their own, to their issue, ie grandchildren or great grandchildren of the testator. The shares are held in a statutory trust for the children, in equal parts, until each reaches the age of 18 or marries, whichever happens first. The definition of children now includes legitimate, illegitimate or legally adopted children but not stepchildren.

In a case where there is a surviving spouse but no issue, the spouse's statutory legacy increases to £200,000 in addition to the personal effects. If the estate is larger than this and there are no surviving issue, but other relations are alive, such as parents, brothers, sisters, etc, then the spouse receives all the personal effects together with £200,000 and half of the residue of the estate absolutely, with no life interest being applicable.

If a brother or sister of the deceased dies in the deceased's lifetime, leaving children, then their children will take the deceased parent's share divided equally between them.

Should a person die leaving a surviving spouse but no children, or other issue, or indeed parents, brothers or sisters or their issue, in other words no blood relative, the surviving spouse receives the whole of the estate, irrespective of its value.

Sadly, disputes do arise whether or not you leave a will. However, because of the existence of a will, provided it is properly worded, these disputes can be reduced.

From 1 January 1996, common-law wives receive an income from the deceased partner's estate and property rights, provided they have lived together for two or more years. This right to benefit is not given under the succession laws but must be claimed by application to a Court.

In England and Wales if a marriage has ended in divorce and a decree absolute has been granted, the divorced spouse is not entitled to any part of the estate. Their children, however, will be beneficiaries. If death took place after decree nisi had been given but before the granting of decree absolute, then a spouse would still be seen in the eyes of the law to be the surviving spouse and would benefit accordingly. A spouse does not benefit if a judicial separation decree has been issued. Such decrees are treated in the same manner as a divorce. A separation order issued by magistrates does not affect entitlement to benefit.

A divorce in England and Wales alters your will and makes any gift to your ex-spouse void. However, the application of the law that creates this effect on other persons in your will may not operate as you would expect. It is very important, therefore, that a new will be made out when major events alter your life. Remember that once the new will has been written, signed and witnessed, you must destroy the old one.

When a person makes a will and then later marries, in England and Wales, such a will is completely revoked or in some circumstances only revoked in part unless it states that it is being made 'in contemplation of that forthcoming marriage, and importantly also states that the will is to remain in force after that marriage. If you are considering making a will before an anticipated marriage and you wish for the will to continue after your marriage, you would be strongly advised to consult a solicitor for advice.

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