Introduction to Estates

What is the “succession estate” (or “distribution estate”)?

All property the deceased owned beneficially at death that passes under a will or intestacy rules.

Which statute gives power to devise or bequeath property by will?

Section 3 Wills Act 1837.

What are the two key issues when distributing an estate?

(1) Whether the deceased left a valid will (testacy vs intestacy).
(2) The nature of the assets owned (succession estate vs excluded property).

Testate

The deceased left a valid will covering their entire succession estate. Only the will applies.

Intestate

The deceased left no valid will. The intestacy rules under AEA 1925 (as amended by ITPA 2014) apply to their entire estate

Partial intestacy

The will does not cover the entire estate. The will applies to covered property, and intestacy rules apply to the remainder

Give an example of partial intestacy

Cassie’s will left her house to Sio and bank account to Rylan, but did not mention personal possessions—> those pass under intestacy

Name types of property excluded from the succession estate.

• Donationes mortis causa (DMCs)

• Discretionary pension scheme benefits

• Insurance policies written in trust

• Statutory nominations (up to £5,000)

• Property held as beneficial joint tenants

• Certain beneficial interests under trusts

What are the requirements for a valid donatio mortis causa (DMC)?

(1) Made in contemplation of imminent death.
(2) Conditional on death (revives if donor survives).
(3) Donor parts with property or ownership symbol.

Example of a DMC?

Kian, terminally ill, gives Caitlyn his watch saying she keeps it if he dies. If he dies, it is hers outside the succession estate.

Why are discretionary pension scheme benefits excluded from the estate?

Payments are at the trustees’ discretion, so the deceased has no beneficial entitlement. Trustees usually follow the deceased’s “Expression of Wish,” but it is not binding.

When do life insurance proceeds form part of the estate?

• Included: Simple life insurance policy → proceeds go into estate.

• Excluded: If policy written in trust (e.g., under Married Woman’s Property Act 1882, express trust, or existing trust) → proceeds go directly to beneficiaries.

What is the effect of statutory nominations?

Up to £5,000 in Friendly, Industrial, or Provident Society accounts can be nominated to a third party. These pass outside the estate on production of a death certificate.

What happens to property held as beneficial joint tenants?

Passes automatically to surviving joint tenant(s) by survivorship, outside succession estate.

What happens to property held as tenants in common?

Deceased’s divisible share forms part of their succession estate.

What is the key issue in beneficial co-ownership of the family home?

Whether legal owners hold it beneficially as joint tenants or tenants in common. Express trusts in the register of title are conclusive; otherwise, implied trusts may arise.

Key case on beneficial ownership of joint bank accounts?

Aroso v Coutts & Co [2002] 1 All ER (Comm) 241.

How are joint bank accounts treated on death?

Legal joint tenants → survivorship applies.
If no express declaration of beneficial ownership, implied trusts or resulting trusts may need to be considered.

Do beneficial interests under trusts always pass into the succession estate?

No. It depends:

• Joint tenants: Interest extinguished on death.

• Tenants in common: Share survives death and passes to estate.

• Life interest beneficiary: Interest ends on death.

• Remainderman: Their vested remainder interest survives death and passes to estate.

Why is trust property usually excluded from succession estates?

Trust assets are distributed under the terms of the trust deed, not by the deceased’s will or intestacy rules. Exception: if the deceased exercised a power of appointment under the trust.