Legacy in United Kingdom
Definition of Legacy
This is a term used in wills and probate matters.
History
Legacy (Lat. legatum), in English law, some particular thing or things given or left by a testator in his will, to be paid or performed by his executor or administrator. The word is primarily applicable to gifts of personalty or gifts charged 373 upon real estate; but if there is nothing else to which it can refer it may refer to realty; the proper word, however, for gifts of realty is devise.
Legacies may be either specific, general or demonstrative. A specific legacy is “something which a testator, identifying it by a sufficient description and manifesting an intention that it should be enjoyed in the state and condition indicated by that description, separates in favour of a particular legatee from the general mass of his personal estate,” e.g. a gift of “my portrait by X,” naming the artist. A general legacy is a gift not so distinguished from the general mass of the personal estate, e.g. a gift of £100 or of a gold ring. A demonstrative legacy partakes of the nature of both the preceding kinds of legacies, e.g. a gift of £100 payable out of a named fund is a specific legacy so far as the fund named is available to pay the legacy; after the fund is exhausted the balance of the legacy is a general legacy and recourse must be had to the general estate to satisfy such balance. Sometimes a testator bequeaths two or more legacies to the same person; in such a case it is a question whether the later legacies are in substitution for, or in addition to, the earlier ones.
In the latter case they are known as cumulative. In each case the intention of the testator is the rule of construction; this can often be gathered from the terms of the will or codicil, but in the absence of such evidence the following rules are followed by the courts. Where the same specific thing is bequeathed twice to the same legatee or where two legacies of equal amount are bequeathed by the same instrument the second bequest is mere repetition; but where legacies of equal amounts are bequeathed by different instruments or of unequal amounts by the same instruments they are considered to be cumulative.
If the estate of the testator is insufficient to satisfy all the legacies these must abate, i.e. be reduced rateably; as to this it should be noticed that specific and demonstrative legacies have a prior claim to be paid in full out of the specific fund before general legacies, and that general legacies abate rateably inter se in the absence of any provision to the contrary by the testator. Specific legacies are liable to ademption where the specific thing perishes or ceases to belong to the testator, e.g. in the instance given above if the testator sells the portrait the legatee will get nothing by virtue of the legacy. As a general rule, legacies given to persons who predecease the testator do not take effect; they are said to lapse.
This is so even if the gift be to A and his executors, administrators and assigns, but this is not so if the testator has shown a contrary intention, thus, a gift to A or his personal representative will be effective even though A predecease the testator; further, by the Wills Act 1837, devises of estates tail and gifts to a child or other issue of the testator will not lapse if any issue of the legatee survive the testator. Lapsed legacies fall into and form part of the residuary estate. In the absence of any indication to the contrary a legacy becomes due on the day of the death of the testator, though for the convenience of the executor it is not payable till a year after that date; this delay does not prevent the legacy vesting on the testator’s death.
It frequently happens, however, that a legacy is given payable at a future date; in such a case, if the legatee dies after the testator but prior to the date when the legacy is payable it is necessary to discover whether the legacy was vested or contingent, as in the former case it becomes payable to the legatee’s representative; in the latter, it lapses. In this, as in other cases, the test is the intention of the testator as expressed in the will; generally it may be said that a gift “payable” or “to be paid” at a certain fixed time confers a vested interest on the legatee, while a gift to A “at” a fixed time, e.g. twenty-one years of age, only confers on A an interest contingent on his attaining the age of twenty-one.
Legacy Duty is a duty charged by the state upon personal property devolving upon the legatees or next of kin of a dead person, either by virtue of his will or upon his intestacy. The duty was first imposed in England in 1780, but the principal act dealing with the subject is the Legacy Duty Act 1796. The principal points as to the duty are these. The duty is charged on personalty only. It is payable only where the person on whose death the property passes was domiciled in the United Kingdom. The rate of duty varies from 1 to 10% according to the relationship between the testator and legatee. As between husband and wife no duty is payable. The duty is payable by the executors and deducted from the legacy unless the testator directs otherwise.
Special provisions as to valuation are in force where the gift is of an annuity or is settled on various persons in succession, or the legacy is given in joint tenancy and other cases. In some cases the duty is payable by instalments which carry interest at 3%. In various cases legacies are exempt from duty—the more important are gifts to a member of the royal family, specific legacies under £20 (pecuniary legacies under £20 pay duty), legacies of books, prints, etc., given to a body corporate for preservation, not for sale, and legacies given out of an estate the principal value of which is less than £100.
Further, by the Finance Act 1894, payment of the estate duty thereby created absorbs the 1% duty paid by lineal ancestors or descendants of the deceased (the Finance Bill 1909-1910 re-imposed this duty, and extended it to husbands and wives as well as descendants and ancestors) and the duty on a settled legacy, and, lastly, in the event of estate duty being paid on an estate the total value of which is under £1000, no legacy duty is payable. The legacy duty payable in Ireland is now for all practical purposes assimilated to that in Great Britain. The principal statute in that country is an act of 1814.
Source: Encyclopedia Britannica (1911)
Legare
Legare Definition
(Lat.) In the civil and old English law. To bequeath; to leave or give by will; to give in anticipation of death. In Scotch phrase, to legate. (…). 18b. Applied to real, as well as personal, property. (This definition of Legare is based on The Cyclopedic Law Dictionary.)
Meaning of Legacy
The following is an old definition of Legacy [1]: A bequest, or gift, of goods and chattels by testament. A bequest of personalty; but will be construed to apply to realty, if the context requires it.0 Compare Devise. Legatee. The person to whom the gift is made.Demonstrative legacy. A bequest of a sum of money payable out of a particular fund or thing. A pecuniary legacy, given generally, but with demonstration of a par- ticular fund as the source of its paypient. A ” demonstrative ” legacy differs from a ” specific ” legacy in this respect, that if the fund out of which it is payable fails for any cause it is nevertheless entitled to come off the estate as a general legacy: and it differs from a ” general ” legacy in this, that it does not abate in that class, but in the class of speciflc legacies. All cases proceed upon the principle that whether a legacy Is demonstrative or specific must be decided by the intent of the testator as it appears from the will; and that, where a legacy is held to be demonstrative, a general intent is shown to have it paid without reference to the fund on which it is primarily charged. The rule that demonsti’ative legacies, or such as are payable out of a specific fund, are preferred, as to that fund, in a case of deficiency of assets to pay all legacies, is a rule of intention merely. General legacy. A legacy so given as not to amount to a bequest of a particular thing or money, distinguished from all others of the same kind. Specific legacy. A bequest of a part of the testator’s personal estate which is so distinguished. A legacy is ” general ” where its amount or value is a charge upon the general assets, and where, if these are sufificient to meet all the provisions of the will, it must be satisfied. A legacy is ” specific ” when it is limited to a particular thing, subject, or chose in action, so identified as to render the bequest inapplicable to any other; as, the bequest of a horse, a picture, a jewel, or a debt due from a person named, and, in special cases, even of a sum of money. A ” specific ” legacy is one that can be separated from the body of the estate and pointed out so as to individualize it, and enable it to be delivered to the legatee as a thing sui generis. A ” general ” legacy may or may not be a part of the testator’s property; but a ” specific ” legacy must be a part, severed or distinguished. To make a legacy ” speciflc ” it must appear by express words, or by inference resting upon a strong, solid, rational interpretation of the will, that the testator intended that the legatee should take the particular thing and nothing else. If the thing specifically bequeathed does not remain at the death of the testator, there is no legacy. Vested legacy. When the interest of the legatee is so fixed as to be transmissible to his personal representatives, although he dies before the period arrives for payment of the money. Contingent legacy. When, from the terms of the bequest, or from the uncertainty of the event, upon which the legacy is made payable, no immediate interest passes to the legatee, but his title to the legacy depends upon his being in a condition to receive it when due. Where a legacy is given to a person to be paid or payable at or when he shall arrive at the age of twenty-one, or at a future definite period, the interest in the legacy vests immediately on the testator’s death, the time being annexed to the payment and not to the gift of the legacy. This rule is positive except when clearly overborne by the expressed or necessarily implied intention of the testator. When there is a substantive bequest of money to be paid at a future time, the legacy is “vested.” When there is no antecedent bequest, independent of, the period fixed for payment, the legacy is ‘ contingent.” In England, when a legacy is given to a person ” as,” “if,” “when,” or “provided” he arrives at a certain age, or ” at ” that time, and there is no other controlling evidence of intention, the legacy is contingent. The rule’ is a correct one where the words “if” or ” provided ” are used, and in cases where the other words are used in giving a legacy to a minor if there is a provision for intermediate support or other evidence of an intention to give contingently. See When. The words ” in case ” imply a condition as explicitly as “if,” “upon,” and the like, and express a contingency. A direction to pay when the legatee attains a certain age, the interest of the fund being given him in the meantime, shows that a present gift is intended, and the legacy vests in interest at the death of the testator. But a direction to pay at a future period vests in interest immediately, if the payment bepost-poned for the convenience of the estate or to let in some other interest. Ordinarily, an unqualified gift of the use, income and improvement of personal estate vests an absolute interest. A rule of construction is, that when a bequest is made to individuals by name, although they in fact constitute a class, the intention to give to them individually is indicated, and thus the share of one dying before the testator will become intestate property. But this rule, founded on the supposed wish of the testator, may be controlled by those portions of the will, if such exist, which indicate an intent that such shall not be the result. If it appears from the whole will that the testator intended that his beneficiaries should take as a class, the share of one who dies before the testator will go to the survivors. When a legacy is given to a class as ” the children ” of a person, and no period is fixed for the distribution of the legacy, it is considered as due at the testator’s death, and none but children born or begotten previously are entitled to share in it. Where there is postponement of the division of a legacy given to a class until a period subsequent to the testator’s death, any one who answers the description so as to come within the class at the time for division will be entitled to a share, though not in esse at the death of the testator, unless the will shows an intention in the testator to limit his boimty to such of the class as would answer the description when the will took effect by his death. Where the bequest is in terms immediate, and so intended to be. and the description of persons to take is general, there none that do not fall within the description at the time of the testator’s death can take. See Each. Other descriptive terras applied to legacies are: absolute, vesting at once, unconditionally; accumulative, cumulative, or additional, superadded to another legacy; alternative, of one of two things; conditional, dependent upon some event, contingent; lapsed, where the legatee dies before the testator, or before a specified event; residuary, of the residuum (see, in this resource, the term) of the estate. The want of permanency in the condition of different kinds of personal property has occasioned much difficulty in construing bequests of future interests in chattels personal. Without considering such bequests, and having in view only general bequests of personal property or money, the rule is that, by means of an express trust, personal property may be subjected to any hmitations not inconsistent with the rule against perpetuities, and it is established that, by or without creating an express trust, an executory bequest of personal property to take effect on a contingency that must happen, if at all, on the death of the first taker, may be a valid bequest. In cases of deficiency of assets, general legacies ” abate ” proportionably; but a specific legacy not at all, unless there is not sufficient without it. Demonstrative legacies abate as between themselves, and pari passu with specific legacies, but are preferred to general legacies. See Abatement. Specific legacies are invariably liable to ” ademption;” as a rule, general and demonstrative legacies are not. See Ademption. A legacy equal to or greater than a debt is a ” satisfaction ” of the debt; less than the debt, it is not a satisfaction pro tanto. But slight circumstances will rebut this presumption. Where there are two legacies of equal amounts, the legatee takes one only; other- wise, if the amounts are unequal. A bare direction that a devisee shall pay money to a legatee creates a personal obligation. To constitute a ” charge upon the land ” devised, there must be express words to that effect or a necessary implication that such was the intention. Realty will not be charged with the payment of debts and legacies when there is personalty more than sufficient to pay them, unless the intention to charge the realty and exonerate the personalty is clear. When the testator has not created an express trust fund wherewith to pay legacies, but has made a general residuary disposition of his whole estate, blending realty and personalty in one fund, the realty is constructively charged with the legacies. If a legacy is made a personal charge on a devisee, acceptance of the devise imposes a personal liability on him, and he takes as a purchaser in fee; but if the legacy is charged on the estate, he takes as a beneficial devisee. A devise or bequest to a person for the benefit of himself and others, though accompanied with power to sell, lease, use, or expend, does not confer an absolute property in the first taker, nor make the object liable for his debts. A legacy is the transfer of an inchoate interest, and not perfected until the executor consents to pay it. His duty is first to see that the debts of the estate are paid. Interest is payable after a year from the deatli of the testator.
Resources
Notes and References
- Concept of Legacy provided by the Anderson Dictionary of Law (1889)
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