Construction of a Will

Peter Kristic died in March 2007. Probate of a will created in August 2003 was granted in June 2007. His will provided:

a) $20,000 to Fiona Garraway;

b) $5,000 to Somers Yacht Club;

c) $20,000 to the deceased’s sons, Mark and Nicholas, who survive him and attain the age of 21 years; and

d) The residuary estate to such of Mark and Nicholas as survive him and attain the age of 40 years and 36 years respectively with a gift over to the deceased’s grandchildren who survive him and attain 35 years.

Neither Mark (aged 24) nor Nicholas (aged 20) had children.

Peter’s estate after payment of debts and expenses and allowing for the legacies, is approximately $450,566 less ongoing administration expenses, taxation, legal fees and property related expenses.

Mark and Nicholas sought the Court’s determination concerning the proper construction of Peter’s will regarding two questions:

• relating to the gift of the residuary estate and
• a legacy to Nicholas

As we have previously posted the written words in the will must be given their ordinary meaning, having regard to any established rules of construction and construing a ‘will as trained legal minds would do’.

Mark and Nicholas submitted that as they had survived Peter and there were no grandchildren, they should not have to wait until the ages of 40 and 36 years respectively to receive the residuary estate.

The Court applied the rule in Saunders v Vautier an adult beneficiary who has an absolute interest in the capital and income of the estate may at any time require the transfer of the property to them

In the circumstances that both Mark and Nicholas failed to attain the respective ages of 40 and 36 years the will provides that the children of Mark and Nicholas alive at the date of Peter’s death, so that they ‘survive’ him, and attain the age of 35 years.

It was argued that natural meaning of the word ‘survive’ means to ‘outlive’, that is, being alive before, and after, the testator. Therefore as Peter had no grandchildren, the gift can never take effect. This means that what is left is a gift of the residue of the estate to Mark and Nicholas if they attain the ages of 40 and 36 years respectively.

Counsel for the defendant rejected the plaintiffs’ submissions

The Court found that Peter’s intentions, as disclosed by the words of his will, were to benefit his immediate family, contingent upon Mark and Nicholas’s attaining a certain age. As they are the only persons who have an interest in the residuary they can require the transfer of the residuary estate and any accumulations to themselves by reason of the application of the rule in Saunders v Vautier.

We have posted before that a Will is a document that needs to be revisited from time to time. When you create a Will make sure that you revise it so that your loved ones are not dealing with legal fall out at an already difficult time.