When a gift changes its name

We have posted this week regarding the situation where a gift in a Will is no longer part of the Will maker’s estate when they die. When this occurs the gift fails due to Ademption.

However there are exemptions to ademption. For example June Mulette created a Will directing that:

“all monies standing to the credit at the date of my death in my credit union account conducted at the Lands Department Credit Union together with any funds received from the State Authorities Superannuation Board to World Vision Enterprises of Australia of 5 Northcliffe Road Milsons Point to be used for Aboriginal Children’s Welfare and Education absolutely.”

the administrator of June’s estate sought orders in relation to the gift due to the following reasons:

• at the date of death June did not have an account in the name of the Lands Department Credit Union;

• her estate had no money identifiable as having been received from the State Authorities Superannuation Board, although the Board clearly held monies for her which were subsequently paid to her as a commuted superannuation lump sum amount; and

• there is no charity known as World Vision Enterprises of Australia and the charity World Vision Australia did not have any premises at 5 Northcliffe Rd Milsons Point. That address was the address of a deregistered entity called World Vision Enterprises of Australia Pty Ltd which was a company associated with Paramount Pictures Productions.

The Court accepted evidence showing that the Lands Department Credit Union was absorbed into Reliance Credit Union and June’s account number with the Reliance Credit Union is the same as the account number with the Lands Department Credit Union.

A gift does not adeem if the gift has changed in name or form only (but not in substance) between the time when the will was executed and the date of death.

However as the proceeds received from the State Authorities Superannuation Board have become so mixed with other funds that that the monies obtained can no longer be identified it follows that the bequest has been adeemed.

As far as June’s wish to leave a bequest to World Vision for Aboriginal children’s education and welfare in NSW legislation provides the Court may make an order to rectify a will if it is satisfied the will does not carry out the testator’s intentions because of clerical error or if it does not give effect to the testator’s instructions. Similarly a general charitable intention is to be presumed unless there is evidence to the contrary.

The Court rectified the Will as it accepted that June did not intend to make any bequest to a private company connected with a commercial organisation as opposed to a charitable organisation which she had previously supported, and found no evidence against the presumption of charitable intention therefore the bequest to World Vision was given with charitable intention and can be applied as near as possible to the June’s intentions by World Vision Australia applying the funds to the “Linking Hands” projects which focus on “assisting indigenous families and communities in Australia”