The recent tragic passing of actor Gene Hackman and his wife, Betsy Arakawa, has cast a spotlight on the need to regularly review and update Wills, and to be prepared to consider who should inherit from you, in the event of circumstances you do not really wish to contemplate.
The circumstances of Hackman's death highlight the critical importance of including contingency clauses, often referred to as longstop provisions, to address potential situations where gifts to beneficiaries may fail—especially as uncertainty now surrounds Hackman's estimated $80 million (£62 million) fortune.
In this instance, the couple had Wills in place, naming each other as the sole beneficiary. However, while Betsy's Will included a substitution clause—stipulating that if Gene were to pass within 90 days of her, her estate would go into a trust and eventually be donated to charity—Gene's will did not contain any such clause.
Such an omission is a common pitfall for those making Wills, and importantly, it can lead to significant complications. Evidence suggests that Betsy passed away just seven days before Gene, meaning it is his Will that will govern the distribution of their fortune. However, with the sole beneficiary now deceased, the matter falls under California's succession laws. Under English law, as the gift of residue in Hackman's Will could not take effect due to Betsy having died before him, his estate would have devolved following the laws of intestacy, resulting in his entire estate being shared equally between his three children.
Hackman may have thought, given the age difference between him and his wife, that he did not need to think about what would happen if she died before him, as he felt that was highly unlikely. This situation emphasises a vital point: you need to consider circumstances that you may believe unlikely when preparing your Will, to ensure it accurately reflects your wishes.
Typically, those who are married and have children do not want to think about who should benefit in the event of a catastrophic event such as an accident involving the whole family.
People may think that if their primary beneficiary dies before them, they will have the ability to update their Will and take account of the change of circumstances. Sadly, however, it is not always the case, due to events or lack of capacity at the time the Will needs to be updated. With people living longer, it is not uncommon now to see situations where people outlive one of their children but lack capacity to update their Will and give effect to their wishes in those circumstances.
To guarantee that your estate is administered according to your wishes, it is strongly advised to seek trusted legal advice, as this will result in you having to consider things that you may not have thought of, or may not wish to think about, but are important to consider.
This will help ensure that your Will accounts for all possible eventualities and ultimately prevents your assets from passing Bona Vacantia to the Crown. Typically, people choose, as Betsy did, that a charity (or more than one) is the longstop beneficiary of their estate if there are no loved ones alive to inherit.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
