Myles Shearman

+44 (0)1733 887832 mtshearman@greenwoodsgrm.co.uk

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Deathbed gifts – what are they and are they legally binding?

Wealth Preservation / 12 November 2021

A deathbed gift, or Donatia Mortis Causa in homage to the term’s Roman law origin, is a gift made by a person (‘the donor’) in contemplation of their death.  A valid deathbed gift takes effect on the donor’s death and passes outside of any Will the donor may have or the intestacy rules if there is no Will in place.

The gift does not need to be made on the donor’s deathbed per se, however, the following conditions must be met to ensure that the gift is legally binding:

 

  1. The donor must make the gift in contemplation of their death;

The gift can be made many months before death, but it must be made at a time when the donor genuinely believes they are going to die in the near future.

  1. The gift must be conditional upon the donor’s death actually occurring;

If the gift is made in contemplation of death by a certain cause, for example, a specific disease, but the donor then recovers from this disease, or dies from other causes, the gift is automatically revoked.  Even if the donor does not use the words ‘conditional’ or ‘contingent’, the courts can infer this wording depending on the circumstances.

 

  1. The donor must part with the gift or deliver it so that ownership passes to the recipient; and

The donor must give the recipient either: i) physical possession of the subject matter of the gift, ii) means of accessing the subject matter of the gift, for example, a key to a box which contains the gift, or iii) documents evidencing entitlement to the gift.

 

  1. The donor must have mental capacity to make the gift.

The threshold for mental capacity depends on the subject matter of the gift.  If the gift is trivial the standard of proof is not as high as that for making a Will.  If the gift is significant, then the degree of mental capacity must be the same as that for making a Will.

The main disadvantage of a deathbed gift is the difficulty providing credible evidence that the above conditions have been met.  A deathbed gift can be challenged by beneficiaries, creditors and other individuals who believe they are entitled a share of the donor’s estate under the Inheritance (Provision for Family and Dependants) Act 1975 and fighting this claim can be a costly and time-consuming process.

In order to avoid the inherent uncertainty surrounding deathbed gifts, the best course of action is often to make a Will which specifically grants such gifts to the intended recipient.  If you would like to make a Will, you can find out more about our Will services here.

 

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This update is for general purposes and guidance only and does not constitute legal or professional advice. You should seek legal advice before relying on its content. This update relates to the prevailing circumstances at the date of its original publication and may not have been updated to reflect subsequent developments. If you have general queries about our updates, please email: mailinglists@greenwoodsgrm.co.uk

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