Also known as: takers in default of appointment · default taker
Written by attorneys · grounded in primary & secondary sources — see below
A person who takes part or all of the appointive property to the extent that the power is not effectively exercised. The clause identifying such persons is called the gift-in-default clause.
Theresa Tucker created a trust giving her son Talia Torres a power to appoint trust principal among her grandchildren. The instrument named Talia Torres's children as takers in default. In her will Talia Torres appointed the principal to her daughter Tori Taylor, who was already a taker in default. Tori Taylor receives the property under the gift-in-default clause rather than under the appointment.
Tristan Thompson held a testamentary power over family trust assets with no named takers in default. His attempted appointment to a nonexistent entity failed. The appointive property passed to Tristan Thompson's estate as the default taker under the governing rule for an ineffective exercise of a general power.
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The property passes to the donee or the donee's estate under the default rule for general powers. This outcome follows because the donor did not provide an effective gift-in-default clause to redirect the property elsewhere.
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The appointee takes under the gift-in-default clause rather than under the appointment to the extent the appointee would have received the property without the appointment. This rule prevents the appointment from altering the donor's disposition in that limited respect.
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The persons identified in the gift-in-default clause take the appointive property. If the clause names a class, members of that class receive the property according to the clause terms.
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