Just a short note on the operation of demonstrative legacies. Demonstrative legacies should on balance be avoided in will drafting if possible. However, one must be guided by your client’s wishes. A demonstrative legacy is one where the testator leaves a sum from a specific asset. So for example, “I GIVE DEVISE AND BEQUEATH the sum of €5000 from my AIB account” or “I GIVE DEVISE AND BEQUEATH €5000 from my Ryanair Shares”.

One will generally steer clients away from leaving specific assets to beneficiaries. For example, rather than saying “I give my 2008 Tiguan to my daughter Mary”, it is generally better to state “I give whatever car I may own at the date of my death to my daughter Mary”. Or rather than saying “I give me AIB bank account, at AIB, Swords”, we prefer to either leave a sum or a per-centage. If a specific asset is left to a beneficiary and it is not in existence at the date of death, then the beneficiary receives nothing. This is referred to as the ademption of the asset or the asset is adeemed.

Demonstrative legacies are a type of a hybrid specific bequest. They differ from a specific bequest because if it is the case that the asset the subject of the demonstrative legacy is not in existence at the date of death, then the demonstrative legacy does not adeem, it “stays alive” so to speak. What happens is that the inheritance the subject of the demonstrative legacy is treated as a “general legacy”. A general legacy is one that is paid from the residue.

So a demonstrative legacy which would not normally be recommended for testators works out in the event that the asset is adeemed.

This does sound somewhat academic but it does have important consequences. So, if the estate is fully solvent and the assets far exceed the liabilities then the demonstrative legacy which was adeemed will be paid from the residue and the balance of the residue paid out to the residuary beneficiaries. This is because an adeemed demonstrative legacy is treated like a general legacy.

However, where the expenses exceed the residue then the demonstrative legacy (where the asset is not in existence – ie where it has adeemed) will form part of the residue and will be “eaten up” with the rest of the residue.

However if the subject matter of the demonstrative legacy is still in existence at the date of death, then that demonstrative legacy will supercede pecuniary legacies. This has important consequences where an estate is solvent but the expenses exceed the residue. Where the expenses exceed the residue the pecuniary legacies are used to pay the expenses and the expenses are allocated pro-rata the pecuniary legacies (in cases where the expenses exceed the residue but not the value of the pecuniary legacies). The demonstrative legacies stand outside the “pot” of pecuniary legacies. A demonstrative legacy is not considered a pecuniary legacy for the purposes of calculating the order of payment of expenses. If all the pecuniary legacies are used for the payment of expenses and there are still expenses owing, then demonstrative legacy forms part of the pot of the other general devises and legacies under the will and will abate with them pro-rata.

Hope this helps and if you have any probate, will drafting or tax queries, please do not hesitate to use the solicitor query service at https://theprobatehub.ie/solicitor-query/ or email me on colm@theprobatehub.ie.