710. Simple gift of annuity followed by residuary gift.

Where the gift of an annuity by will1 is in the form of a simple gift followed by a gift of residue, the general rule is that the annuitant must be paid in preference to the residuary legatee, who can take nothing until the annuitant has been paid in full2. In such cases the annuity is therefore a charge on capital3.

The right of an annuitant claiming under a simple gift to have recourse to the capital of the residue is not taken away by a subsequent direction in the will to trustees to pay the annuity out of income4.

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