SQE2 Wills & Probate Practice 2 — Questions and Answers
Question 1: The rule in Saunders v Vautier allows beneficiaries who are:
- Minors with court approval
- All adult, fully entitled and absolutely entitled under the trust to terminate the trust and demand the assets (Correct answer)
- Any majority of beneficiaries to override the trustee
- Contingent beneficiaries to advance their interest
Correct answer: All adult, fully entitled and absolutely entitled under the trust to terminate the trust and demand the assets
Saunders v Vautier permits beneficiaries who are all of full age, absolutely entitled and between them hold the entire beneficial interest to collapse the trust and take the assets outright.
Question 2: In a will, a residuary clause is important because:
- It names the executors
- It disposes of everything not covered by specific or general legacies, preventing partial intestacy (Correct answer)
- It sets out the testator's funeral wishes
- It appoints guardians for minor children
Correct answer: It disposes of everything not covered by specific or general legacies, preventing partial intestacy
Without a residuary clause, any property not specifically bequeathed (including property acquired after the will was made) passes on intestacy rather than as the testator intended.
Question 3: The 'reading back' principle in succession law provides that:
- Later wills always revoke earlier wills
- A mutual will cannot be revoked after the first party dies and the survivor benefits from the arrangement
- A codicil is read as part of the original will (Correct answer)
- A failed gift passes to residue
Correct answer: A codicil is read as part of the original will
A codicil (a later testamentary document) is read together with and as part of the will it supplements, so the will and codicil are interpreted as a single testamentary instrument.
Question 4: An executor's primary duties after a grant of probate include all of the following EXCEPT:
- Collecting in the estate assets
- Paying the deceased's debts and liabilities
- Distributing the estate in accordance with the will
- Advising beneficiaries on their personal tax planning (Correct answer)
Correct answer: Advising beneficiaries on their personal tax planning
Executors must collect assets, pay debts and distribute the estate; advising beneficiaries on their own personal tax planning is outside the executor's role and is a separate matter for the beneficiary's own advisers.
Question 5: Inheritance Tax (IHT) is generally charged at what rate on the amount of an estate above the nil-rate band?
- 20%
- 40% (Correct answer)
- 45%
- 28%
Correct answer: 40%
IHT is charged at 40% on the taxable estate above the current nil-rate band (£325,000); a reduced rate of 36% applies where 10% or more of the net estate is left to charity.
Question 6: A specific legacy in a will 'adeems' when:
- The beneficiary predeceases the testator
- The specific asset bequeathed no longer exists in the estate at the date of death (Correct answer)
- The testator changes their mind but does not alter the will
- The asset increases in value after the will is made
Correct answer: The specific asset bequeathed no longer exists in the estate at the date of death
Ademption occurs when a specifically identified gift has ceased to exist in the testator's estate by the time they die (e.g. sold or destroyed), meaning the beneficiary receives nothing.
SQE2 Wills & Probate Practice 2
The rule in Saunders v Vautier allows beneficiaries who are: