Although it’s unpleasant to consider, there is a possibility that those whom you’d like to benefit in your Will may not survive you. For example, you may wish to give all your worldly possessions to your spouse, but he or she may die before you. Or you may wish to pass your estate to your children in equal shares, but one of them may die before you.
What happens then? Who would inherit your property if one of your beneficiaries dies before you do?
The Texas Estates Code provides that a beneficiary of a Will must survive the testator by five days to inherit property unless a testator’s Will contains language that:
- deals with simultaneous deaths or deaths in a common disaster; or
- requires that a beneficiary survive the testator, or survive the testator for a stated period to inherit under the Will.
Most Wills include survivorship language that restricts a person who dies within a short time of the testator’s death, say 30 or 60 days, from inheriting. The purpose of such a provision is to ensure that the testator’s estate passes according to his or her own wishes, rather than through the estate of the beneficiary who died within a short time of the testator.
Without such a provision, the testator’s property may not pass as intended. For example, suppose a testator’s Will provides that his car will pass to one of his nephews if he survives the testator. If the nephew survives the testator for even just a few hours, he would inherit the car. In the event he dies a week later, that car would then pass to his heirs through his estate even though the testator may have preferred that it pass to a dear friend instead.
By including a provision specifying that someone who dies within a short time of the testator will be deemed to have predeceased the testator, the testator’s wishes for the car would control.
If the Will does not contain any survival language, then state law requires the beneficiary to survive the testator by five days to inherit.
It is good practice to name a contingent beneficiary who will receive property if the primary beneficiary predeceases (or is deemed to have predeceased) the testator. In that case, it is clear that the alternate beneficiary would receive the property.
But what happens if the Will does not name a contingent beneficiary, or if the contingent beneficiary predeceases or is deemed to have predeceased the testator? In that case, the gift will have failed or “lapsed.” The way lapsed gifts are distributed is controlled by how the Will is written and state law.
Wills often provide that a lapsed gift will become part of the residuary estate and pass to the residuary beneficiary or beneficiaries.
Even if the Will is silent on this issue, the Texas Estates Code provides that if a gift, other than a residuary gift, fails for any reason, then the gift will become part of the residuary estate and will pass to those the testator named as the residuary beneficiaries of the estate.
The Texas Estates Code also provides that if multiple residual beneficiaries are named and one of the beneficiaries predeceases the testator, the deceased beneficiary’s share would pass to the other residuary beneficiaries in proportion to the surviving beneficiaries’ interest in the residuary estate.
So for example, suppose Tom, Dick and Harry are named as residual beneficiaries, and each are to inherit an equal share of the estate. If Harry predeceases the testator, his share of the residuary estate would be divided equally between Tom and Dick.
The residuary estate will pass as though the testator died intestate only if all the residuary beneficiaries:
- are dead when the will is executed,
- don’t survive the testator, or
- are treated as though they have predeceased the testator.
Your attorney can customize your Will to ensure that your property passes as you’ve intended, taking into account all the contingencies life can bring.