Class Gifts

A class gift is a gift that is distributed to a group of beneficiaries rather than individually. The members may change by the time the property is distributed—some may have been born into the group and some may have died. However, the members living at the time of the property distribution will have a right of survivorship, so if members of the group die before the gift is distributed, then their portion is distributed equally among the surviving members. Unless provided otherwise in the will, the descendants of the deceased members of the group do not share the class gift.

However, class gifts to "issue," "descendants," "heirs of the body," "heirs," "next of kin," "relatives," "family," or other similar descriptions will automatically include descendants of any predeceased members of the class since the description itself includes descendants.

A class gift differs from distributing gifts to multiple individuals, because the individuals are usually identified specifically, so if some die before the distribution, there is no right of survivorship, and, instead, if the there is no gift-over clause, the gift is distributed according to the jurisdiction's lapse rules.

Generally, the class gift is described as an aggregated sum that is to be divided among the beneficiaries living at the time of distribution, when the number of beneficiaries may be more or less than when the gift was devised.

Whether the gift was intended to be a class gift or gifts to multiple individuals is sometimes ambiguous. The courts generally consider 4 factors in determining whether the gift was a class gift:

• the testator's overall testamentary scheme;
  • generally, if the testator provided an express right of survivorship to a class, and the right is not expressed for another group of beneficiaries, then the gift to that group would not be considered a class gift;
  • the courts may also analyze how the gift may lapse: does the beneficiary of the lapsed gift conform to the testamentary scheme;
• whether the beneficiaries constitute a distinct class;
  • if they share a characteristic that is not shared by anyone else, then this indicates a class gift;
  • however, if there are some members of the class that were specifically excluded, this indicates that the gifts were individual gifts;
  • if the number of individuals was specified, then this is an indication that it was not a class gift, because a class of beneficiaries can shift in number with births and deaths;
• if the beneficiaries were described as a group or individually;
  • identifying by name argues against a class gift;
• and the description of the gift; when each gift is specified, then it is probably an individual gift, but if the gift is described as something to be divided, then it is probably a class gift.

The above factors are not legal requirements, but are only considered if they shed light on the testator's intent.

If a gift is determined to be a class gift, then the beneficiaries have a right of survivorship even when anti-lapse rules would not apply. But if the anti-lapse rules do apply, then, because applying the anti-lapse doctrine would re-direct a gift to a close relative while the class gift doctrine would go to another member of the class, who may not be a close relative of the testator, the law favors the anti-lapse rules over the class gift rules where both can be applied to a predeceased beneficiary. However, there are a few states that do not apply their anti-lapse statutes to a void class gift, where the beneficiary was dead when the will was executed; hence, in these jurisdictions, only the class gift rules, if applicable, would be applied to void gifts.