Failed Transfers and Residue

When a gift in a will cannot be fulfilled, it typically becomes part of the leftover assets, known as the residue. In California, if a gift meant for one of several beneficiaries fails and the anti-lapse statute doesn't apply, the remaining beneficiaries will share the failed gift instead of it being lost entirely.

A testator leaves a specific gift of a painting to their friend, but the painting is destroyed before the testator's death. Since the gift failed and the anti-lapse statute does not apply, the value of the painting goes into the residue and is divided among the remaining beneficiaries. Therefore, the remaining beneficiaries will share the value of the painting.

In California, failed gifts feed the residue, not the void!

Exams may present scenarios where a specific gift fails, and students might mistakenly think the gift is lost instead of being absorbed into the residue. Watch for details about anti-lapse and multiple beneficiaries to avoid confusion.

Questions often involve a failed gift scenario with multiple beneficiaries, testing your understanding of how residue is distributed and the application of the anti-lapse statute.