In this the second of the series of Articles taken from David’s paper (Will your will work well”) David describes and explains various types of Wills
Under our will we appoint executors (who become trustees if administration of our estate goes beyond the “executors year”) to get in our assets, deal with our liabilities and distribute our estate according to our wishes – holding certain assets as trustees if the entitlement to them is postponed.
The types of wills include:
- Wills in contemplation of marriage. Any will is revoked by marriage. However, because newly weds might not be focussed on the need to make new wills immediately after their wedding, the law provides for them to make their wills prior to marriage. Any will that is expressed to be in contemplation of marriage to a certain person will not be revoked by the will makers marriage to that person.
- Mutual wills. These are rare but they have their place. Here each will maker benefits the other and agreed beneficiaries in reliance on the other will maker not changing their will without joint agreement. Because it takes away testamentary freedom (the right to revoke your will by making another) I have never been confident that a mutual will can “stick”. However, I am sure they have their place.
- Wills creating legacies, bequests, donating organs, directing cremation/burial, imposing conditions on inheritances such as age, marital status etc.
- Wills creating life/widowhood interests. These provisions give limited rights until the beneficiary dies or remarries. The Death Certificate or Marriage Certificate evidences the end of the interest.
- Wills creating rights of occupation. These are common for blended families and in de facto relationships. The danger with them is how to determine when the right ends. Often it is left to the trustees to determine whether the beneficiary is in a new relationship (how many days/weeks residence, toothbrush test, holidays) so if the trustees are the surviving partner and a child from the first relationship (who is to benefit when the right ceases) then there is a conflict and often an argument as to when the right has ceased.
- Hotchpot provisions. These take into account gifts/loans (other than small amounts for Christmas, birthdays etc) made by the will maker during his/her lifetime. Such gifts and loans are taken into account prior to distribution of the deceased’s estate to even out the entitlement of the beneficiaries.