Lapse

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Compiled by Eric B. Appleby:

Generally

Generally, when a person to whom property has been devised or bequeathed dies before the testator, the devise or bequest fails or lapses, and the property goes as if the gift had not been made. See The Dictionary of English Law by Earl Jowitt (1959) at page 1059. By his will, the testator left his entire estate to two friends. One friend predeceased the testator. The issues raised by the administrator of the estate were whether the gift to the deceased friend lapsed and who was entitled to the gift. The Alberta Surrogate Court held that the testator did not intend the gift to lapse and that the remaining beneficiary was entitled to the entire estate as a surviving joint tenant. See Kolenic Estate, Re (1989), 93 A.R. 257 (Sur. Ct.).

Devolution of lapsed gift

A will equally divided the testator’s estate amongst her eight children and one grandchild. One of the witnesses to the execution of the will was the spouse of a beneficiary (a daughter). Section 12(1) of the Wills Act rendered the bequest to the daughter void. The co-executors of the estate applied for directions as to the disposition of the daughter’s interest in the estate. The New Brunswick Court of Queen’s Bench, Trial Division, held that the daughter’s one-ninth share of the estate was to be divided as on an intestacy. Accordingly, all eight children, including the daughter, equally shared the one-ninth share – See Brown Estate v. Bon (2003), 263 N.B.R.(2d) 287; 689 A.P.R. 287 (T.D.) para. 118. A testatrix bequeathed $10,000 to a niece. The niece predeceased the testatrix. The trustee applied for interpretation of the will to dispose of niece’s interest. The Saskatchewan Court of Queen’s Bench held that s. 32 of the Wills Act did not apply to save the gift because the beneficiary was only a niece by marriage. Therefore, the gift lapsed, and fell into the residue and would pass according to law of intestacy. See Pearson Estate, Re (1989), 81 Sask.R. 221 (Q.B.).

Tracing (exception from lapse)

A testatrix provided in her will that shares held jointly by herself and her husband would go to her daughter and then to her daughter’s children, in the event her husband predeceased her. The husband predeceased her. It was argued at trial that the gift lapsed because at the time of her death there were no shares held jointly by herself and her husband. Upon the death of the husband, his interest in the jointly held shares passed to the wife. The Nova Scotia Supreme Court, Appeal Division, found that the trial judge was correct in concluding that the gift was of specific shares that could be traced in specie through splits and transfers to the time of the testatrix’s death and that the gift did not lapse. See Palmer v. Royal Trust (1986), 73 N.S.R.(2d) 435; 176 A.P.R. 435 (C.A.).

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This entry was last updated: February 13, 2017