Question: I recently lost my father. His will was made out to my brothers and I as follows: son one, farmhouse worth €200,000; daughter, €50,000; son two, shares and remaining residue of estate,

approx total €30,000.

We are awaiting closure of a repayment to the Department of Social Protection. If there is a liability to be paid, where does the money come from?

Will it be a percentage of each beneficiary’s inheritance (ie, son one paying 71.5% of the liability as he is inheriting 71.5% of the value of the estate and similarity with daughter and son two) or does it come from the residue firstly and then the difference made up by son one and daughter to pay liability in full based on their percentage?

Answer: Unfortunately, it is likely that son two and possibly you, as the daughter, may have to foot the bill from the Department of Social Protection. This could have been avoided if your father’s will specified who was to pay the debt or from what bequests debt should be deducted.

However, if the will is silent on the matter, it generally comes from the residue initially, then cash bequests. It is only a matter of last resort that real property would be sold to pay the debts of an estate.

Order of priority

A solvent estate is one where there are enough assets to pay the debts as well as the funeral and testamentary expenses. Where there are more assets than liabilities, your estate is solvent.

If your assets are not sufficient to fulfill all of the wishes in your will, after paying the debts and expenses, your estate is solvent but not sufficient.

If someone makes a will but there is not enough left after paying all of the debts and expenses to give the full gift to everyone, then there is a set order to which parts of the estate debts are paid from first:

  • Property which you did not deal with in the will (that is, property which would be distributed in accordance with the rules on intestacy)
  • The residue – this is the amount left over when specific bequests are dealt with. This is what son two has been left in the will
  • Property specifically devoted for the payment of debts – there does not appear to have been provision made for payment of debts under the will
  • Property charged with the payment of debts – again, this does not seem to apply
  • Pecuniary legacies – these are bequests of money as distinct from property or goods – this would include the cash bequest of €50,000 to the daughter
  • Specific legacies of real property, ie houses and land rateable according to value – this would include the dwelling house left to son one and the shares to the daughter

    • When making your will, you can specify a different order for the payment of your debts or indeed whether certain persons are to pick up the debt.

    If the will is silent on the matter, it generally comes from the residue initially, then cash bequests

    For example, in farming scenarios, debt associated with the farm is normally specified to be the responsibility of the child being left the farm. The will can be worded whereby the farm is left to a son or daughter on condition they take over the farm debt. That means that the non-farming children get their bequests unaffected by the debt, which this query highlights.

    Disclaimer:The information in this article is intended as a general guide only. While every care is taken to ensure accuracy of information contained in this article, Aisling Meehan, Agricultural Solicitors and Tax Consultants does not accept responsibility for errors or omissions howsoever arising. Email aisling@agrisolicitors.ie