A lapsed legacy refers to a bequest that was intended for someone in a will, but the intended recipient has passed away before the testator. Consequently, the gift will not be bestowed upon anyone and will instead revert back to the estate. To illustrate, if your grandmother bequeathed $100 to you in her will, but you predeceased her, the $100 would be returned to your grandmother’s estate rather than being inherited by your family.
A lapsed legacy refers to a type of legacy that becomes ineffective because the intended recipient has passed away before the person who made the will (known as the testator). In simpler terms, the legacy becomes invalid because the person who was supposed to receive it is no longer alive. For instance, if someone leaves $10,000 to their nephew in their will, but the nephew dies before the testator, the legacy is considered lapsed. In this case, the $10,000 will be given to the residuary beneficiary, who is the person or organisation designated to receive any remaining assets after specific gifts have been distributed. Lapsed legacies can also occur if the intended recipient is no longer eligible to receive the gift due to a change in circumstances. For example, if someone leaves their car to their son, but they sell the car before they pass away, the legacy is considered lapsed.
A lapsed legacy refers to a situation where a beneficiary named in a will predeceases the testator (the person who made the will). In such cases, the gift or inheritance intended for the beneficiary fails and does not pass to their estate or heirs.
When a legacy lapses, it typically falls into the residue of the estate, which means it becomes part of the remaining assets to be distributed according to the terms of the will or the laws of intestacy if there is no will.
In some jurisdictions, a lapsed legacy can be revived if the testator’s intent can be proven through extrinsic evidence or if there are specific statutory provisions allowing for revival. However, this varies depending on the applicable laws and the circumstances of the case.
Yes, a testator can include a substitution clause in their will to prevent a legacy from lapsing. This clause allows for an alternate beneficiary to receive the gift if the primary beneficiary predeceases the testator.
If there is no substitution clause in the will and the primary beneficiary of a legacy predeceases the testator, the legacy will generally lapse and become part of the residue of the estate.
In some cases, a lapsed legacy can be challenged if there are grounds to contest the validity of the will or if there is evidence of undue influence, fraud, or lack of capacity on the part of the testator. However, successfully challenging a lapsed legacy can be complex and requires strong legal arguments.
Yes, a testator can revive a lapsed legacy by creating a codicil, which is a legal document that amends or supplements an existing will. The codicil must clearly express the testator’s intent to revive the lapsed legacy.
Tax implications may arise from a lapsed legacy, particularly if the lapsed gift was subject to estate or inheritance taxes. It is advisable to consult with a tax professional or an estate planning attorney to understand the specific tax consequences in your jurisdiction.
Yes, regularly updating a will can help prevent lapsed legacies. By reviewing and revising the will periodically, the testator can ensure that the beneficiaries named in the will are still alive and make necessary changes to avoid any unintended consequences.
Yes, it is recommended to consult an experienced estate planning attorney if you have concerns about lapsed legacies or if you need assistance in drafting or updating your will. An attorney can provide personalized advice based on your specific circumstances and help you navigate the legal complexities involved.
This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.
This glossary post was last updated: 16th April 2024.
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