What happens when an asset that is to be left to certain beneficiaries in a Will is sold before prior to the maker of the Wills death?

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What happens when an asset that is to be left to certain beneficiaries in a Will is sold before prior to the maker of the Wills death?

My mother’s Will states that her house goes to 6 people upon her death. There is no wording in her Will about who gets the proceeds of the house if it is sold before her death as she never intended to leave it. However, she has moved into assisted living and her house just sold. Her Will further states that the residue of her estate be divided by left to 10 other people and divided equally among them. Now the money from the house is in the same bank account with her previous funds and is being spent down by her assisted living expenses. My mother is insistent that she does not want to make any adjustments to her Will and just wants to leave it alone. If there is money left at the time of her death, what will happen to the 6 heirs that the house was left to?

Asked on January 24, 2015 under Estate Planning, New York

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

A Will passes on assets that are in an estate at the time a "testator" (i.e. the maker of a Will) dies. However, just because there was an exisiting asset at the time the Will was drafted, does not mean that it could not be sold prior to the testator's death. The beneficiaries of the sold asset would then have to be singled out to recieve the proceeds (either in the Will itself or by putting the proceeds in a separate account). If they were not and the money from the sale was co-mingled with other money, then all the money in the account will pass as per the terms of the Will at the time of the testator's death.

The fact is that in your situation, your mother has chosen not to make an adjustment for this. Consequently, her estate will be distributed to the listed beneficiaries in her Will (i.e. the 10 other people not the original 6 who were to have gotten the house). Perhaps if you could explain this to your mother, she'll choose to make the necessary changes to her Will or otherwise remedy the situation. 

 


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