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When a gift isn’t

11
Feb 2021

When a gift isn’t

Ademption is a legal doctrine relating to specific gifts in a will.  A specific gift might be of a particular house, possession, or money in bank account.  A specific gift in a will is said to adeem or fail if, at the date of death, it no longer exists in the estate of the person who made the will.

An attorney is someone appointed by a person – the grantor – to act in his / her name in relation to financial and / or health related matters.  The appointment is usually made by the grantor in anticipation of a time when he / she may no longer have capacity to make these decisions.

However, what happens when an attorney requires to sell a specific gift in a will and the grantor no longer has capacity to make a new will?  Depending on where you live in the UK, the position is different.

In the recent Scottish case of Turner (Gordon’s Executor) v Turner, the sale of a house by an attorney to avoid its ongoing maintenance was considered a prudent act of administration that should not disadvantage the intended beneficiary under the will.  On the other hand, had it been necessary for the attorney to sell the house, for example to pay for care home fees, the gift would have failed for it would have been an act that the grantor would have had to take, had she had the capacity to do so.

Conversely, in England & Wales the gift will fail unless the attorney makes an application to the Court of Protection to act a deputy in this regard.  A deputy is like an attorney but is appointed by the Court of Protection.  By virtue of section 18 and paragraph 8 of Schedule 2 to the Mental Capacity Act 2005, where a deputy disposes of a specific gift, irrespective of any act of necessity, the beneficiary will receive the benefit in any property representing the original asset, so far as circumstances allow.

In Scotland, to avoid the failure of a specific gift though an act of necessity by the attorney, section 53 of the Adults with Incapacity (Scotland) Act 2000 permits an application to the court for an order that might result in an alteration to the will being made to enable the beneficiary to benefit from the gift so far as circumstances allow.

In England & Wales, section 18 and paragraph 4 of Schedule 2 to the Mental Capacity Act 2005 permits the Court of Protection to make a Statutory Will for those who lack capacity.

However, such applications to preserve the benefit of a specific gift by a new will are not certain of success.

 

Simon Ingham qualified as a solicitor in Scotland and now practises in England.

 If you have a dispute in England & Wales that relates to a will or inheritance, please e-mail  newenquiries-inheritancelit@chadlaw.co.uk.

 Alternatively, if you need advice about a dispute – or wish to try and avoid the possibility of disputes arising like the situation described – please contact us by phone on 0800 015 0340 or e-mail info@chadlaw.co.uk.

 

 

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