Wills commonly contain administrative provisions in addition to the clauses that record appointments and gifts. This guide explains the purpose of common provisions; the exact wording and effect depend on the Will and the relevant jurisdiction.
Administration of my Estate
This gives the executors/trustees power to postpone sale of your assets if required, and to pay off any debt, inheritance taxes and expenses, such as your mortgage or lawyer fees for probate from your estate. It defines what “residuary estate” is to make sure that all your assets are covered in the Will to avoid intestacy laws applying to any of your assets.
Administrative Provisions
Your executors / trustees (“trustees”) are regulated by the respective trust laws in the country where the Will is being submitted for probate. They are restricted within the provisions of those laws and may not have the full flexibility to manage your estate when certain situations arise.
It is therefore common to add some standard clauses to give your trustees the freedom to manage your estate in certain situations. The following descriptions explain the purpose of common administrative clauses.
(a) Your trustees may invest the estate’s money and change those investments over time, with the same freedom they would have if the assets belonged to them personally.
(b) Your trustees may use trust money to buy or improve a home for one or more beneficiaries, on terms they decide are appropriate.
(c) Your trustees may be required to consider other funds before using your estate for the maintenance and benefit of the beneficiaries, a clause may give them wider discretion to use the estate for the beneficiaries.
(d) Instead of restricting the trustees to advance only one half of what the beneficiary’s presumptive share is on your estate, it is usual to give the trustees the flexibility to advance any amount.
(e) As your trustees have power to insure your assets against any risks, a clause may allow the premium to be paid from the income or capital of the residuary estate.
(f) Your trustees can now appropriate any assets for the satisfaction of the beneficiary’s share without the need to obtain their consent. Obtaining their consent may lead to delays and possibly disputes between the beneficiaries.
(g) The rule of apportionment involves complex calculations on how the estate is to be administered. A clause may disapply that calculation and simplify administration for the trustees.
(h) To treat all income from your estate as income, no matter when it is earned, without having to split or allocate it between different time periods.
(i) Your trustees can exercise their powers as trustees even though they may be personally interested in your estate as the beneficiary.
(j) Your trustees can use the income and capital of your estate to maintain and improve any of your assets.
(k) Your trustees may access, manage, copy, transfer, or close your digital accounts and files, including devices, online accounts, cloud storage, emails, social media, and other digital assets.
Other possible clauses
Charity gifts - For a charitable gift, a clause may be included to ensure that there is a proper discharge of receipt. If there is any hiccups with the gift i.e. the charity no longer exists, then your trustees can still give the gift away to a related charity.
Temporary Guardianship - Your trustees can reimburse any fees incurred by the temporary guardians.
Ask the Will drafter about any provision you do not understand or do not want included.