In the absence of a vested right, an interest in the estate of another is merely an expectancy. This means that, until the person dies, the beneficiary does not have an absolute right to inherit anything. Conversely, once an interest in a will has vested, a beneficiary has an enforceable right against an estate. A recent article discusses vested rights and expectancy in terms of estate planning.
Even if a person is named as a beneficiary within another’s estate plan, he or she should not count on receiving the stated inheritance. An expectancy in an estate could quickly go elsewhere. The testator could re-write his or her will, the assets could be sold or otherwise disposed of, the beneficiary could predecease the testator, or the assets could be used to pay any claims against the estate.
Some assets within an estate plan do create vested rights. One such asset is the gift of real property subject to a reserved life estate. A reserved life estate divides a piece of real property into a present and future interest. At the time of executing such a deed, the named beneficiary’s future right to the real property vests immediately. Although this right does not mature until the death of the present interest holder, the beneficiary has a vested interest that cannot be defeated.
