Description of the legal term Per Capita Distribution:
Per capita distribution is a principle used in the distribution of an estate where the estate is divided equally among the living descendants of the same generation nearest to the deceased. This method contrasts with ‘per stirpes’ distribution, which distributes an estate according to the deceased’s lineage, not by the number of living relatives.
Under per capita distribution, each beneficiary of the same generational level receives an equal share of the estate. If a beneficiary in this group predeceases the testator (the person who has made a will or given a legacy), the deceased beneficiary’s share is not passed on to their descendants, but instead, is redistributed equally among the remaining beneficiaries of the same generation.
In British law, the default position when someone dies intestate (without a will) is to distribute their estate per stirpes. To ensure a per capita distribution, a testator must express this intention in their will. Still, even with a will, the interpretation can be complex, and the precise wording of the will is crucial in determining how the estate is to be divided.
Moreover, the utility of per capita distribution arises when a decedent wishes to ensure that their estate benefits their relatives equally, rather than their assets being concentrated in individual branches of the family. This can prevent one line of descendants from receiving a large inheritance because they have more children, while another line receives less.
When the estate passes per capita, every living member at the eligible level – often children or grandchildren of the deceased – stands to receive an equal slice of the estate. This approach is often regarded as more equitable by some testators, as it does not favor the distribution of wealth based on the fecundity of their offspring’s lines.
Legal context in which the term Per Capita Distribution may be used:
Imagine a scenario where John, a widower, has three children: Anne, Philip, and Mark. Anne has two children of her own, Philip has none, and Mark predeceased John, leaving behind one child, Sophie. In John’s will, he stated: “I leave my estate to my children in equal parts per capita.” When John dies, his estate, worth £900,000, will be divided into three equal parts of £300,000 each, to be distributed to Anne, Philip, and Sophie — equally. As Mark is deceased, his share doesn’t pass to his offspring per stirpes; instead, Sophie receives an equal share directly, according to John’s intent for per capita distribution. This ensures that all living members of the generation closest to John are treated equivalously, regardless of whether their parent is alive.
Further, let’s consider another instance where Elizabeth passes away without a will, and according to the rules of intestacy, her estate should be distributed per stirpes to her surviving relatives. However, Elizabeth’s surviving family believes that her intent, based on statements made during her life, was for her grandchildren to inherit equally since she had a close relationship with each. To honor what they believe to be Elizabeth’s wishes, the family may agree to a deed of variation that allows them to alter the distribution of the estate to per capita. This way, even though the rules of intestacy applied initially, the family’s agreement would honor Elizabeth’s perceived will, and each grandchild would inherit an equal portion of the estate.
The practical application of this term underscores the importance of clear testamentary instructions when preparing a will, to prevent confusion and potential disputes amongst heirs. It reflects the nuances of fairness in estate division and the testator’s intention, ensuring that the distribution of assets is managed in a manner deemed equitable by the deceased, which is of paramount importance in the British legal system.
