Also known as: bare residuary clauses · residuary clause
Written by attorneys · grounded in primary & secondary sources — see below
A residuary clause in a will that contains no reference to any powers of appointment held by the testator. Under the majority rule such a clause does not exercise a power of appointment even if the testator later expresses an intention to do so outside the will.
George held a power of appointment over trust assets. His will left the residue of his estate to his children without mentioning the power. Although George later told family members he intended the residuary clause to exercise the power, the clause is bare and therefore does not exercise it. The appointive property passes under the default provisions of the creating instrument rather than to George's children.
Helen Sullivan's will contained a bare residuary clause leaving the rest of her estate to her heirs at law living at her death. The clause made no mention of any powers of appointment. Because the clause was bare, it did not exercise any power Helen held. The property subject to the power therefore passed according to the terms of the instrument that created the power rather than under the residuary clause.
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No. The general rule is that a bare residuary clause that makes no reference to any powers of appointment does not exercise a power of appointment. Under the majority approach the clause is presumed not to have exercised the power.
Supporting sources
Jurisdictions are split on whether statements by the testator to family members that the residuary clause exercises the power are admissible as evidence of intent. Under the UPC a basic residuary clause expresses an intention to exercise a power only if the power is general and exercisable in favor of the powerholder's estate and the creating instrument contains no effective gift in default, or if the will manifests an intention to include the appointive property.
Supporting sources
…future assets were to consist solely of the proceeds of these policies and the property which would pour over under the will’s residuary clause. The judge found that the remaining trustee has never received any property or held any funds subsequent to the execution of the trust nor has he paid any trust taxes or filed any trust tax…