Interpretation of wills and failure of gifts - Lapse, discla...

Learning Outcomes

This article outlines the failure of testamentary gifts by lapse, disclaimer, and forfeiture, and how these mechanisms affect estate distribution under wills and intestacy, including:

• identifying lapse of specific, general, and residuary gifts and applying the anti-lapse rule in s.33 Wills Act 1837
• recognising contrary intention wording, class gifts, and substitutional provisions that displace or modify s.33
• analysing failure of residuary gifts, accretion between co-beneficiaries, and when partial intestacy arises
• tracking the destination of failed gifts through substitution, residue, s.33, and intestacy in both single-beneficiary and multi-beneficiary wills
• distinguishing joint tenancies from tenancies in common and determining the impact of survivorship on lapse, disclaimer, and forfeiture
• stating the formal and practical requirements for a valid disclaimer and explaining its irrevocable legal effect
• explaining the scope of the forfeiture rule, the role of the Forfeiture Act 1982, and how courts may grant or refuse relief
• comparing the operation and consequences of lapse, disclaimer, and forfeiture to resolve complex problem questions systematically
• evaluating when a disclaimer is preferable to a post-death variation, with an outline of key inheritance tax and anti-avoidance considerations

SQE1 Syllabus

For SQE1, you are required to understand the rules governing the failure of gifts in wills, including the legal consequences of lapse, disclaimer, and forfeiture, with a focus on the following syllabus points:

• the meaning and effect of lapse of gifts in wills, including anti-lapse rules (e.g., s.33 Wills Act 1837)
• how and when a beneficiary can disclaim a gift, and the legal effect of disclaimer
• the operation of the forfeiture rule and the Forfeiture Act 1982
• the consequences of these failures for the distribution of the estate (e.g., residue, intestacy)
• the interaction between lapse, disclaimer, and forfeiture, and how to apply these rules to practical scenarios
• wording that evidences a contrary intention preventing s.33 from operating, particularly survivorship language and class gifts
• gifts to multiple beneficiaries: the impact of joint tenancies versus tenancies in common on failure and accretion

Test Your Knowledge

Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, remember to look more closely at that area during your revision.

1. What is the general rule if a beneficiary under a will dies before the testator?
2. How does s.33 of the Wills Act 1837 modify the rule on lapse for gifts to children or remoter issue?
3. What is the legal effect of a beneficiary disclaiming a gift under a will?
4. In what circumstances does the forfeiture rule prevent a beneficiary from taking a gift, and what is the effect on the estate?

Introduction

When a person makes a will, they intend their property to pass to chosen beneficiaries. However, gifts in a will can fail for several reasons. The main ways a gift may fail are by lapse (the beneficiary dies before the testator), disclaimer (the beneficiary refuses the gift), or forfeiture (the beneficiary is disqualified, usually due to unlawful killing). Understanding these rules is essential for advising clients and for the SQE1 exam.

Gifts may also fail for other reasons covered elsewhere (e.g., ademption for specific gifts where the asset is no longer in the estate, uncertainty, or invalid witnessing affecting particular gifts). Here, the focus is strictly on lapse, disclaimer, and forfeiture: how each failure is triggered, where the property goes next, and how statutory saving provisions, especially s.33 Wills Act 1837, interact with these outcomes.

Key Term: lapse
Lapse is the failure of a testamentary gift because the beneficiary dies before the testator or is otherwise unable to take.

Lapse of Gifts

A gift in a will generally fails, or "lapses," if the beneficiary dies before the testator. The property then passes according to the will's other provisions or, if none, under the intestacy rules. Lapse is concerned with the fundamental requirement that a beneficiary must normally be alive at the testator’s death to take, unless saved by statute or express drafting.

The General Rule

If a beneficiary does not survive the testator, the gift to them lapses. The property will fall into the residue of the estate, or if it is a residuary gift, it will pass under intestacy unless the will provides otherwise. Where a gift is to multiple beneficiaries “equally” or “in equal shares”, this is usually a tenancy in common and each share must be considered separately: a deceased co-beneficiary’s share is treated as failed and dealt with under the will or, absent provision, by intestacy.

Conversely, where a gift is expressly to beneficiaries “as joint tenants”, survivorship operates in the gift itself: a predeceasing joint tenant’s interest does not cause a lapse of the whole gift—survivors take the whole on the testator’s death, unless all joint tenants have predeceased.

Anti-Lapse Rule (s.33 Wills Act 1837)

Section 33 of the Wills Act 1837 creates an important exception. If a gift is made to a child or remoter descendant of the testator, and that person dies before the testator but leaves issue who survive the testator, the gift does not lapse. Instead, the issue take the gift in place of their deceased parent, unless the will shows a contrary intention.

The rule applies only to gifts to the testator’s own “issue” (children or remoter descendants). It does not apply to gifts to other relatives such as siblings, nieces/nephews, or to a spouse/civil partner. If the will gifts residue “to my children”, and one child dies leaving children who survive the testator, those grandchildren will step into their parent’s shoes under s.33 for that share, unless the will’s wording excludes s.33.

It also applies to gifts to a class comprising the testator’s issue. For example, a gift “to my children” is saved pro tanto: the deceased child’s branch is represented by their issue. Distribution among issue is ordinarily per stirpes (by branches), unless the will provides otherwise.

Key Term: anti-lapse rule
A statutory rule (s.33 Wills Act 1837) that saves gifts to children or remoter issue from lapsing if they die before the testator but leave issue who survive the testator.

Contrary Intention

The statute does not apply if “a contrary intention appears by the will”. Wording such as “to such of my children as survive me”, “to my surviving children”, “if he fails to survive me, this gift shall pass to X”, or an explicit statement that s.33 WA 1837 is not to apply, will prevent the saving effect. Careful reading of class closing language and survivorship conditions is required. If the will identifies substitutes different from the deceased child’s issue, those substitutional provisions govern, not the statute.

Lapse of Residuary Gifts

If a gift of residue lapses (e.g., the residuary beneficiary dies before the testator), the lapsed share passes under the intestacy rules unless the will contains a substitutional provision. This outcome often creates a partial intestacy, so well-drafted wills typically include substitution clauses for residuary shares to avoid unintended intestacy. Section 33 may save a residuary share if the deceased residuary beneficiary is the testator’s issue and leaves issue who survive.

Substitutional Provisions

A testator can include a clause such as “to my brother, but if he predeceases me, to his children in equal shares.” This prevents lapse by specifying who should take if the primary beneficiary cannot. Substitution interacts with s.33: where a substitution identifies someone other than the deceased child’s issue, that contrary intention displaces s.33. Where a substitution gifts to the deceased child’s issue, it mirrors s.33 but may control how shares are split (for example, per capita rather than per stirpes).

Lapse and Joint Tenancies

If a gift is made to two or more people as joint tenants, the gift does not lapse unless all die before the testator. If one joint tenant dies before the testator, the surviving joint tenant(s) take the whole. If a gift is silent, courts look to wording such as “equally”, “in equal shares”, and administrative powers to infer tenancy in common rather than joint tenancy. Always read the gift as a whole.

Worked Example 1.1

Scenario:
A will leaves £10,000 to "my daughter, Anna." Anna dies before the testator, leaving two children. The will is silent on substitution.

Answer:
The gift does not lapse. Under s.33 Wills Act 1837, Anna's children take the £10,000 in equal shares.

Worked Example 1.2

Scenario:
A will gifts “the residue of my estate to my children in equal shares, but only to such of my children as survive me.” One child dies before the testator leaving two children. The other children survive.

Answer:
The survivorship wording shows a contrary intention, so s.33 does not apply. The deceased child’s share does not pass to their children. The surviving children share the residue between themselves, and the deceased child’s share is excluded from taking.

Exam Warning

If a will uses words like "to such of my children as survive me," this may show a contrary intention and prevent s.33 from applying. Always check the wording of the will.

Disclaimer of Gifts

A beneficiary may refuse a gift under a will. This is called disclaimer. The effect is that the beneficiary is treated as if they had died before the testator, and the gift passes as directed by the will or, if not, to the next entitled under the residue or intestacy.

Disclaimers are a practical tool where beneficiaries prefer not to receive a gift personally, or wish property to pass to another person under the will’s structure (e.g., to their own issue via s.33) rather than by making a lifetime gift or executing a variation. The critical distinction is that a disclaimer rejects the gift completely; it does not direct who should receive it next.

Key Term: disclaimer
The refusal or renunciation by a beneficiary of a gift under a will, resulting in the beneficiary being treated as if they had predeceased the testator.

Requirements for Disclaimer

• The disclaimer must be clear and unequivocal.
• It is usually made in writing, but there is no prescribed form. In practice, personal representatives will seek a signed written disclaimer.
• The beneficiary must not have accepted any benefit from the gift. Acceptance may be implied by taking income or otherwise dealing with the asset as owner.
• The disclaimer must be of the whole gift; partial disclaimer is not generally permitted. If a beneficiary is entitled to separate gifts, they may disclaim one gift and accept another, but cannot split a single gift.

Capacity is required to disclaim; a person lacking capacity may disclaim only via appropriate Court of Protection authority. Disclaimers can be made before or after grant; personal representatives should retain the disclaimer on file to evidence the distribution route.

Effect of Disclaimer

Once a gift is disclaimed, the beneficiary cannot later change their mind. The property passes as if the beneficiary had died before the testator. If s.33 applies, the issue of the disclaiming beneficiary may take the gift. If s.33 does not apply and there is no substitution clause, the gift will usually fall into residue; if the disclaimed gift is of residue and there is no substitution, partial intestacy arises.

A disclaimer does not constitute a transfer by the disclaimant in favour of someone else; it is a refusal. For inheritance tax, a disclaimer is generally not treated as a transfer of value by the beneficiary. Where a parent disclaims so that their minor child takes instead under s.33 or substitution, the disclaimer is not treated as a “settlement” for income tax anti-avoidance purposes, unlike some variations, and so does not trigger the “settlor-interested” rules for minor children.

Worked Example 1.3

Scenario:
Ben is left a legacy of £50,000 in his mother's will. He wishes to disclaim the gift. He has two children.

Answer:
If Ben disclaims the legacy, he is treated as having predeceased his mother. The £50,000 passes to his children under s.33 Wills Act 1837.

Worked Example 1.4

Scenario:
Cara is left “my painting by X” and “£10,000”. She wants the painting to pass to her adult son under the will but to keep the cash. She has not taken possession of either.

Answer:
Cara may disclaim the painting entirely and accept the cash gift. A disclaimer must be of the whole of the particular gift; she cannot disclaim part of the painting gift. The painting will then pass as if Cara had predeceased: if the will gifts the painting to substitutes, that governs; if it is a standalone specific legacy to Cara and she is the testator’s child, s.33 may pass the painting to Cara’s issue.

Tax and Disclaimer

For inheritance tax, a disclaimer is not treated as a transfer of value by the beneficiary. The gift is treated as if it never vested in them. This can be preferable to a lifetime gift or some variations. However, a disclaimer cannot alter the will’s provisions; it simply triggers the default route (substitution, s.33, residue, or intestacy). If the intended destination is not achieved by those routes, a post-death variation may be needed.

Revision Tip

If a beneficiary wants to redirect a gift to someone else, a disclaimer is only suitable if the will or intestacy rules will pass the property as desired. Otherwise, a post-death variation may be needed.

Forfeiture of Gifts

The forfeiture rule is a principle of public policy: a person who unlawfully kills another cannot benefit from their victim's estate, whether under a will, intestacy, or by survivorship. It is long-established and applies regardless of the victim’s wishes. The rule extends to associated entitlements such as nominations and survivorship on joint holdings.

Key Term: forfeiture rule
A rule of public policy that prevents a person who has unlawfully killed another from benefiting from their victim's estate.

Scope of the Rule

The rule applies to murder, manslaughter, and certain other unlawful killings (including assisting suicide and some driving offences causing death). Where the killer was insane at the time of the killing, the rule does not apply. If the rule applies, the killer is treated as having predeceased the victim, so any gift to them lapses or is distributed as if they had predeceased the testator. If the killer is the testator’s issue and leaves issue who survive the testator, s.33 may cause the gift to pass to the killer’s issue (subject to contrary intention in the will).

The Forfeiture Act 1982

The Forfeiture Act 1982 allows the court to modify the effect of the forfeiture rule in some cases (e.g., manslaughter), but not for murder. The court may grant relief if justice requires, considering all circumstances, including the conduct of the deceased and the offender and the nature of the offence. Applications must be made promptly; do not assume relief will be granted—case-specific facts matter.

Relief can be full or partial. Where relief is granted, the killer may take under the will or intestacy in accordance with the order. Courts have granted relief in compassionate assisted dying contexts where the offender’s conduct was motivated by care and the circumstances were exceptional.

Effect on the Estate

If the forfeiture rule applies, the property passes as if the killer had died before the victim. If s.33 applies, the killer's issue may take the gift. If there are substitutional provisions, these govern. If the rule affects a residuary gift and there is no substitution saving that share, a partial intestacy may arise. The rule also applies to nominations and payable-on-death entitlements where the deceased would otherwise benefit the killer.

Worked Example 1.5

Scenario:
A will leaves the residue of the estate to "my son, David." David is convicted of manslaughter in relation to the testator's death. David has a daughter, Lucy.

Answer:
David is disqualified from inheriting. The court may grant relief under the Forfeiture Act 1982, but if not, David is treated as having predeceased the testator. Lucy may take the residue under s.33 Wills Act 1837.

Worked Example 1.6

Scenario:
Emma assists her terminally ill husband to travel to Dignitas, and he ends his life there. Emma is convicted of assisting suicide. Her husband had left Emma the family home and residue. They were a devoted couple; Emma tried to dissuade him.

Answer:
The forfeiture rule applies to assisting suicide, but the court can grant relief under the Forfeiture Act 1982. Given compassionate circumstances and the husband’s conduct, relief may be granted, allowing Emma to inherit. If relief is refused, the gifts to Emma would fail and be distributed as if she had predeceased.

Forfeiture and Joint Tenancies

If a killer and victim own property as joint tenants, the killer cannot take by survivorship. The killer is treated as having predeceased; the victim’s share passes under the will or intestacy. The joint tenancy is treated as severed for this purpose; the killer retains their own beneficial share but cannot acquire the victim’s share by survivorship.

Exam Warning (Forfeiture)

The court cannot grant relief from forfeiture for murder. Relief is only possible for lesser offences such as manslaughter or assisting suicide, and only if justice requires.

Interaction of Lapse, Disclaimer, and Forfeiture

All three mechanisms result in the beneficiary being treated as having predeceased the testator. The gift then passes according to the will's substitutional provisions, s.33, or the intestacy rules. This “as if predeceased” analysis helps in problem-solving: identify the next taker under the will, check for statutory saving for issue, and if neither applies, determine whether the gift falls into residue or intestacy.

Where there are multiple beneficiaries, consider whether the gift is a joint tenancy (survivors take the whole) or tenants in common (only the deceased’s share is affected). Also consider class gifts: if a class comprises the testator’s issue, s.33 may substitute issue for a deceased member of the class. Survivorship words and closing rules can exclude s.33.

Worked Example 1.7

Scenario:
A will leaves £20,000 to "my nephew, Mark." Mark dies before the testator, leaving no children. The will is silent on substitution.

Answer:
The gift lapses and falls into residue. If there is no residuary clause, it passes under intestacy.

Worked Example 1.8

Scenario:
The will leaves “my residuary estate to my three friends A, B, and C in equal shares.” Before death, B disclaims his share in residue. There is no substitution clause.

Answer:
B is treated as having predeceased. The result is a partial intestacy as to B’s third, unless the will provides otherwise. A and C take their own thirds; B’s share is distributed under intestacy rules.

Practical Distribution Steps

• Identify the nature of the gift (specific, general, pecuniary, residuary).
• Determine whether the beneficiary survived the testator. If not, or if disclaimed/forfeited, treat as predeceased.
• Check for substitutional provisions; apply them if present.
• If the beneficiary is the testator’s issue and leaves issue who survive, consider s.33 unless contrary intention appears.
• If the gift fails, determine whether it falls into residue or causes partial intestacy (especially for residuary shares).
• For co-beneficiaries, consider joint tenancy versus tenancy in common language to decide whether survivorship operates or shares lapse individually.

Key Point Checklist

This article has covered the following key knowledge points:

• Lapse occurs when a beneficiary dies before the testator; the gift fails unless saved by s.33 or a substitutional clause.
• Section 33 Wills Act 1837 saves gifts to children or remoter issue if they leave issue who survive the testator; “contrary intention” wording (e.g., survivorship conditions) prevents s.33 operating.
• Disclaimer allows a beneficiary to refuse a gift; they are treated as having predeceased the testator. Partial disclaimer of a single gift is not generally permitted and acceptance bars disclaimer.
• Forfeiture prevents a person who unlawfully kills the testator from benefiting; relief may be granted for offences other than murder if justice requires, considering all circumstances.
• For joint tenancies, survivorship in the gift defeats lapse unless all joint tenants predecease; forfeiture prevents the killer taking by survivorship.
• Failed gifts pass under substitution clauses, s.33, residue, or intestacy. Residuary shares that fail commonly result in partial intestacy unless substitution is provided.
• Disclaimers are not transfers of value for inheritance tax and can avoid settlement anti-avoidance issues that may arise with some variations; they do not allow directing who takes next.

Key Terms and Concepts

• lapse
• anti-lapse rule
• disclaimer
• forfeiture rule