Explained! Lapse, Abatement and Ademption of Legacies

INTRODUCTION

A gift is typically defined as an ownership transfer of property that is carried out voluntarily by the giver without any payment or other incentive. The parties may be two live individuals, the transfer may occur only after the transferor's death, and the property may be either moveable or immovable. Inter vivos refers to a transfer that occurs between two living individuals, and testamentary refers to a transfer that occurs after the transferor's death.

Only inter vivos transactions are referred to as gifts under this Act since testamentary transfers are not covered by Section 5 of the Transfer of Property Act. It may happen in certain cases that the gift might fail. Gift may fail due to the reasons of lapse, ademption and abatement. We will further understand through this article what these three causes are due to which gifts fail are.

LAPSE

When a testamentary gift fails because the legatee passes away before the testator does, either before or after the will is made, it is referred to as a "lapse." The testator must live in order for the legatee to be entitled to his legacy; otherwise, the legacy will not be enforceable. The testator is free to make his will regardless of the legatees' status on the day it is made. A legatee need only exist at the time of the testator's death; they do not have to be alive on the day of the will. Sec. 105 to 100 of Indian Succession Act deals with the provisions of lapse.

The legatee's passing during the testator's lifetime is the only incident covered by section 105. This notion is only applicable if the legatee had a beneficial interest. Generally speaking, a devisee or legatee must outlive the testator in order for his or her estate to benefit from the gift, and a codicil's confirmation of a will's gift to a decedent who has passed away since the will's date keeps the gift from lapsed.

In the case of S.J. Lakshmi Bai v. Pothana Apparao[1], it was decided that this clause does not require the testator to have specifically anticipated the possibility of lapse in the event that the legates pass away while the testator was still living and to have made provisions for such eventuality. This section only confirms the legatee's exclusive claim to her share in relation to the other legatees under the terms of the will.

It is not a statement opposing lapse in cases where the legatee passed away before him. If the legatee A passes away before the testator, the bequest disappears even if it is given to A and his executors, administrators, and assigns[2]. The legacy will expire if it is unclear from the circumstances whether person died first, the testator or the beneficiary[3].

ABATEMENT

Only one-third of a Muslim's property may be bequeathed, regardless of gender, without the heirs' approval. In the event that the heirs decline to grant their assent and the donation above the legal third, the bequest diminishes proportionately but the Will remains operative in its whole. The will decreases ratably and is nevertheless legal for a third of the property even if heirs refuse to accept it.

Illustration I
When a testator passes away, their assets are valued Rs. 120,000. In his Will, he leaves A 20,000 Rupees, B 30,000 Rupees, and C 40,000 Rupees. Given that the testator's total assets amount to Rs 120,000, 30% of that amount is bequestable. A shall receive Rs 20,000 in accordance with the rule of chronological priority because his name appears first. B will receive the remaining Rs 20,000. C won't receive anything because the first part, or Rs 40,000, has already been used up.

• Total assets; Rs 120,000
• Bequeathable one-third = Rs 120,000 X 1/3 = 40,000.
• Amount given under the bequest = Rs 90,000
• Applying the rule of chronological priority
• Amount to be given to A= Rs 20,000
• Amount to be given to B= Rs 20,000
• Amount to be given to C= Nil.

Bequest of Exact One-third

Where under one legacy two or more persons have been given an exact one-third of the totalassets then the rule of chronological priority will not be applicable in that case. In such cases, the legatee whose name appears last gets the one-third given to him under theWill, and the legatees whose names appear prior to him will get nothing.

Bequests for pious purposes

To the extent of one-third bequest of the property for pious purposes is valid under both Sunniand Shia schools of thoughts. Pious purposes are divided into three categories. 

• Bequest for faraiz i.e., such is Hajj,zakat and expiation for prayers missed.2. 
• Bequest for Wajibat i.e., charity given on the day of breaking fast.
• Bequest for nawafil i.e., building a mosque, making a school for poor.

The first class's bequests supersede those of the second and third classes in the three classes in which they are mentioned, and the second class's bequests supersede the third class's bequests. Class 1 once more requires that a bequest for the Hajj be made before a bequest for Zakat, and a bequest for Zakat be made before a bequest for atonement.

ADEMPTION

Ademption is the absence of a stake upon the testator's death, as opposed to inadequate stakes to satisfy the specified allegations (abatement). Whether or not a beneficiary receives any benefit from the inheritance depends entirely on the type of a legacy in cases where the testator leaves an a legacy in which case the subject matter is judged to be non-existent at the testator's death.

When a particular a legacy is used to describe the non-existence of the subject matter, it will imply that the beneficiary receives nothing; an example of this would be if an item is lost or replaced by another object. Section 152 to 165 of Indian Succession Act provides for ademption of legacies.

Presents are frequently phrased to be less explicit; for instance, a present can state that all funds from "all bank and building society accounts" will be transferred upon death rather than funds from a particular bank account. There is a chance that a donation of money from a particular bank account could be deemed if the bank account is closed between attestation and death. A gift of funds from every bank account, however, would only be unsuccessful if there were none left in the estate at the time of death.

The testator's daughter was partially redeemed from the $10,000 bequest for marriage expenditures by virtue of her marriage during the testator's lifetime and the testator's own payment of her wedding expenses; the remaining sum was to be given to her for her personal use[4].

CONCLUSION

Gifts that violate public policy may not be accepted. A typical illustration of this is when a gift carries a condition that is perceived as encouraging a marriage to end, in which case the gift would not succeed. A gift that is given under duress, fear, or any other unfair influence will not succeed. In a similar vein, a gift that has a condition made "in terrorem" of the beneficiaries might not succeed.

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[1] S.J. Lakshmi Bai v. Pothana Apparao, (1969) 2 SCC 91.

[2]  Elliott v. Davenport(1705) 1 P Wms 83.

[3] Agha Mir Ahmed Shah v. Mudassir Shah. (1944) 2 Mad LJ 354.

[4] Lim Soo Siam v Leow Yong Moey & Ors.