Succession Act 116 & Legal Right Share

S

smh

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Hi
I am executor and the chief beneficiary of my father's estate. My mother and my two siblings have only a very minor share.I am interested in transferring some assets to the siblings but do not wish to do so directly for tax reasons. I would like my mother to invoke her legal right share to get 1/3 of the estate. She could then past this 1/3 on to her other two children allowing them to benefit from the much higher CAT threshold.

My father was the chief contributor to a number of accounts of significant value jointly held in my mother's name. These have passed by survivorship to my mother.

While reading the succession act I came across this:

116.—(1) Where a testator, during his lifetime, has made permanent provision for his spouse, whether under contract or otherwise, all property which is the subject of such provision (other than periodical payments made for her maintenance during his lifetime) shall be taken as being given in or towards satisfaction of the share as a legal right of the surviving spouse.
(2) The value of the property shall be reckoned as at the date of the making of the provision.
(3) If the value of the property is equal to or greater than the share of the spouse as a legal right, the spouse shall not be entitled to take any share as a legal right.
(4) If the value of the property is less than the share of the spouse as a legal right, the spouse shall be entitled to receive in satisfaction of such share so much only of the estate as, when added to the value of the property, is sufficient, as nearly as can be estimated, to make up the full amount of that share.
(5) This section shall apply only to a provision made before the commencement of this Act.


My question is basically whether the provisions taken to provide for my mother while he was still alive in the form of these joint accounts will have to be used in partial or full satisfaction of the legal right share. Ideally I do not want this to be the case. I want the assets for the legal right share to come from the estate. Part 5 seems to suggest that my father would have to have made these provisions before 1965 in order for them to count towards the legal right share. Is this the case and if so is there any other piece of legislation which will force me to take into account assets passing outside the estate for fulfillment of the legal right share?

I'd appreciate your opinion very much.
 
Have you instructed a solicitor to act for you? What do they say?

It's a funny thing but if I wanted my mother to get her full share of her legal entitlement I wouldn't be reading through the succession act to find ways around it.
 
Thanks Vanilla for your response. No, I have not got any detailed advice yet from a sollicitor on this question as I have not hired one yet to extract the grant of probate. I have contacted a few however looking for quotes. I have completed the Inland Revenue Affadavit so alot of the work is done and i'm finding some of the quotes I get rather high. The estate is quite complicated and my plan for going forward introduces more complications so I accept that professional legal advice may well be necessary.


It's not that I am trying to find ways around the legal right share. It is in fact my suggestion to my mother that she take it. The reason I ended up reading the relevant section of the act was I wanted to make sure that the assets she already had would not prevent her from taking the share. If they do prevent her from taking a share of the estate I will have to do something else like renouncing my share which will create a partial intestacy which will give her two thirds of what would have been my share. She could of course will part of that back to me again and it makes no difference from a tax point of view whether it is she or my father who is the donor.
 
To be frank you are exactly the kind of client every solicitor dreads. You are not a solicitor, though to be fair you seem to be trying to do some research and study into the matter. You are trying to extract a grant yourself without, presumably, an overall understanding of the legal aspects of the matter and the tax matters and how they all interact. Then having got your grant you will no doubt be looking for a solicitor to implement the conveyancing or transfers necessary. I wouldn't touch this kind of work with a bargepole. I'm sorry if I sound harsh but there is a good explanation of why the quotes you are getting are high. You are a high risk client- ie there is a very high risk that something will go awry here and no matter what, it is the solicitor who will be held negligent in the end. Solicitors prefer to do the whole thing from start to finish for a very good reason- ie they can get it right from the beginning. They have no vested interest so will not prejudice anyones rights.
 
Hi Vanilla

What happens if a solicitor is an executor or co-executor of a will? Do they not have some form of interest for themselves then-in the sense that they cannot be removed from the task if they unduly delay estate administration etc??

Mangos
 
mangos said:
Hi Vanilla

What happens if a solicitor is an executor or co-executor of a will? Do they not have some form of interest for themselves then-in the sense that they cannot be removed from the task if they unduly delay estate administration etc??

Mangos
Click to expand...

Why would a solicitor deliberately delay administration of an estate? The quicker it's finished the quicker they collect their fee.
 
Only where there are no children, where there are children it is reduced to 1/3.
 
Thanks Vanilla for the clarification on this. Does this apply if the children are over 18?
 
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