Residue Clause (Life Interest in Favour of Life Tenant over Remainder Beneficiaries) (ON)

Summary

This residue clause expresses the testator’s intent that the trustees may exercise their discretionary powers and consider the needs of the life tenant ahead of the preservation of assets for the benefit of remainder beneficiaries. This clause includes practical guidance and drafting notes. If a life interest has been created in a will, the inclusion of a gift over after the death of the life tenant is essential to ensure that the testator’s wishes are carried out. There are situations where through inadvertence the provision for the disposition of the estate after the death of the life beneficiary is omitted and the consequences are serious in the overall administration. Depending upon the overall language, the result may be that the trust itself fails and the income beneficiary becomes entitled to the entire estate at the outset. Alternatively, the life interest may be enforced, but on the death of the life tenant, the estate is divided among the beneficiaries who would have received...