The Folly of the homemade will

It has been said that a residuary clause is the most important clause in a will as it sets out who will inherit the remainder of the deceased’s assets once any debts, funeral expenses, inheritance tax and legacies have been paid, and any of the items specifically bequeathed have been distributed to the appropriate beneficiaries.

A simple will may only have a single clause setting out the residuary beneficiary or beneficiaries.

Importantly where an executor is unwilling or unable to act, then the residuary beneficiaries can apply for a ‘grant of letters of administration with the will annexed’.

An effective residuary clause avoids assets passing under the rules of intestacy, potentially to any family members who are not of the deceased’s choosing; alternatively, if there are no family members, then the assets would pass to the Crown, which many people might also wish to avoid.

Background

Angela Thompson (the deceased) prepared a homemade will dated 3 October 2015 naming her husband Trevor as executor. The deceased estate was valued at approximately $511,000. The main assets of the estate were the Boyup Brook property with an estimated value of $130,000 and the Kelmscott property with an estimated value of $370,000.

Angela had two children, Sarah and Laura. The will provided that the Kelmscott Property

‘not be sold until majority of the residing tenants agree to the action. I wish my children to remain in abode as long as it is deemed reasonable’

However, a later clause ( cl 4) empowered the executor

‘to sell, exchange or otherwise dispose of assets in my estate on such terms as he considers expedient as though he were the absolute beneficial owner’

Additionally, cl 3 made several specific dispositions that appear to be entirely overlooked by cl 4. Although the will had no residuary clause reference was made to the residuary estate in cl 5

Trevor obtained probate of the will on 20 November 2017. The deceased estate was valued at approximately $511,000.

Trevor requested that Sarah and Laura vacate the Kelmscott property; they refused only vacating following the threat of eviction proceedings. After agreeing to vacate the property they consented to its sale.

The proceedings

Trevor made an application under s 45 of the Administration Act 1903 (WA) which provides for executors, and administrators to apply to the Supreme Court to make binding orders on

“..any question arising in respect of any will or administration..”.

Counsel for Sarah and Laura disputed the necessity for Trevor to seek directions from the court. In dismissing this argument the Court held that as the will lacked clarity, Trevor as executor of the estate was acting appropriately in seeking directions.

The decision

The Court held that the questions raised by Trevor are unanswerable with the gift of property in cl 3(b) being void for uncertainty. Additionally, the Court found cl 4 to be so broad that it is simply not possible to give a construction of the will which makes sense; as a consequence of this partial intestacy, Trevors inheritance as the deceased’s spouse was enlarged.

The court was concerned that a good part of a modest estate would be consumed expressing the case

illustrates the folly of persons making homemade wills

and that in the circumstances money spent on having a will professionally drafted is a sound investment.

 

 

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