Ademption by satisfaction, also known as satisfaction of legacies, is a

common law Common law (also known as judicial precedent, judge-made law, or case law) is the body of law primarily developed through judicial decisions rather than statutes. Although common law may incorporate certain statutes, it is largely based on prece ...

doctrine that determines the disposition of property under a

will Will may refer to: Common meanings * Will and testament, instructions for the disposition of one's property after death * Will (philosophy), or willpower * Will (sociology) * Will, volition (psychology) * Will, a modal verb - see Shall and will ...

when the

testator A testator () is a person who has written and executed a last will and testament that is in effect at the time of their death. It is any "person who makes a will."Gordon Brown, ''Administration of Wills, Trusts, and Estates'', 3d ed. (2003), p. ...

has made lifetime gifts to beneficiaries named in the will. Under the doctrine, a gift that the maker of the will (the

) gives during his lifetime to a named beneficiary of the will is treated as an advance payment of that beneficiary's inheritance. If the

probate In common law jurisdictions, probate is the judicial process whereby a will is "proved" in a court of law and accepted as a valid public document that is the true last testament of the deceased; or whereby, in the absence of a legal will, the e ...

court determines that the testator intended the lifetime gift to satisfy a bequest under the will, the amount of the lifetime gift is deducted from the amount that the beneficiary would have received under the will.

Application

In the United States, state law determines which lifetime gifts are treated as gifts in satisfaction of a bequest. Under the Uniform Probate Code, § 2-609, a lifetime gift is treated as satisfaction of a legacy only if (i) the will provides for deduction of the gift, (ii) the testator indicated in a contemporaneous writing that the lifetime gift was intended to satisfy a legacy in the will, or (iii) the gift recipient acknowledged in writing that the gift was intended to satisfy a legacy in the will. Courts may presume that gifts of money from a parent to a child after the execution of the parent's will are gifts in satisfaction of the child's legacy under the will, even without a written indication of intent to satisfy the provision under the will. Courts are reluctant to apply the doctrine to certain kinds of legacies, for example, devises of specific real estate or bequests of personal property. These specific legacies are viewed by courts as unique and not able to be replaced with a lifetime gift of money or other property. When the probate court determines that the doctrine applies to a lifetime gift made to a will beneficiary, the amount beneficiary's gift under the will is reduced by the amount the beneficiary has already received. For example, if the will bequeaths $5,000 to a beneficiary, but the beneficiary received a lifetime gift of $4,000 from testator that was intended to partially satisfy the gift under the will, the beneficiary will receive only $1,000 under the will. If the will provides that the beneficiary receives a percentage of the testator's estate, the court may engage in a hotchpot calculation to determine the amount, if any, that the beneficiary should receive under the will. If the value of the lifetime gift received is greater than the beneficiary's calculated share under the will, the beneficiary receives nothing under the will, but does not return any of the lifetime gifts.

References

{{DEFAULTSORT:Ademption by satisfaction Wills and trusts Common law rules

Application

See also

References