Good Life

Money Matters: ‘Specific devise’ trumps all other estate bequeaths

Q: My uncle died and his will states, “I devise my home to my nephew, Bruce.” In the next paragraph it states “I devise and bequeath all of the residue of my estate to my niece, Sally.” There is only one asset in the estate and that is the house. Who gets the house?

A: The method by which your uncle gave the house to you, Bruce, is by a specific devise. A specific devise is superior to all other types of devises in a will. The gift to Sally is by a residuary devise and that is in inferior to a specific devise. In your case, the house goes to Bruce by the specific devise and Sally receives nothing.

Q: My mother died, and when she died she owed the Internal Revenue Service income taxes. She also had other debts. All the debts are greater than the amount of assets. Which debt is paid first?

A: Federal law provides that a claim by the U.S. government is to be paid first when the estate of the decedent debtor is in the hands of an executor and there are not sufficient funds to pay all of the debts. In addition, the executor is personally liable to the government if the wrong debt is paid and there are not sufficient funds to pay the federal debt. Frequently, the federal priority is waived and reasonable administration expenses and funeral expenses are still paid first. The federal rule applies even if there is a conflict with state law.

Q: Is it possible to write into a will a statement that will prevent any beneficiary from contesting the terms of the will and the inheritance that persons are to receive?

A: Yes. It is known as an interrorem or forfeiture clause. They are used infrequently in wills. Their purpose is to prevent a contest of the terms stated in the will. They can be hard to enforce because if the person who is contesting the terms of the will has probably cause to bring an action to contest the will, the court will permit a contest. Probable cause is a moving type of concept that is applied to the facts before the court by the judge who attempts to reasonably determine whether the contestant had some reasonable basis for believing that there is an issue concerning the testator’s capacity, the actions of the executor, the terms of the will and their legality.

The use of an interrorem clause might be avoided if the creator of the will would be more open and transparent with the beneficiaries during his or her lifetime as to what his or her plans were and why at the time of death. A conversation among the parties would eliminate much of the litigation because the parties would hear from the decedent prior to her death.