FIQH: AHLUS SUNNAH WAL JAMA'AH - TRADITIONAL SHAFI'I SCHOOL OF JURISPRUDENCE
X = The person making the bequest (wasiyyah)
Y = The executor elected by X
Z = The recipient of the bequest (wasiyyah)
X may devote one-third or less of his financial resources to bequests, but not more than this. One-third here means - a third of his property as it stands at the time of his death.
If X's heirs are not poor, it is recommended for X to devote a full one-third to bequests. If X's heir are not poor, then it is not recommended for X to devote a full one-third to bequests. Poor heirs here means - that they are not well off - i.e. as when they do not have any money at all, or a little, not enough for their expenses, and the other two-thirds of the estate that constitutes their obligatory shares which they deserve is insufficient.
When There Are No Heirs
In cases where there are no heirs, the Muslim people have better right to X's property, and no individual has the entitlement in Shari'ah to waive this right.
When There Is Lack of Heirs
If there are no Muslim heirs, or if the existent Muslim heirs do not deserve the whole estate (e.g. when the only eligible heir is the husband/wife); such excess may not be disposed-off in bequests, but must be given to the Baitul-Mal (the Muslim common fund), if this exists.
Bequests concerning obligatory expenditures are also considered from the bequeathable one-third, provided that X has stipulated that they come from it. If the bequeathable one-third does not cover these, despite X having stipulated that they come from it, then the excess is paid from the remaining two-thirds. Obligatory expenditures include such things as - paying debts, making up the Hajj, paying Zakat (including for any year that the deceased neglected to pay it), Kafarah (expiations), and the fulfillment of vows that would have been binding had X been well. Nevertheless, if X did not stipulate that these obligatory expenditures should come from the one-third, then they come directly from the other two-thirds.
Current Charitable Dispositions (e.g. Sadaqah, Hadiah etc.)
Current charitable dispositions of property made by X during his life, such as giving waqf (endowment), giving a gift etc. are considered as personal expenditures of X's own money; and he could spend it all without any objection if made while he was in sound health.
But if X makes such current dispositions under any of the following circumstances, when these are linked with his death, then the dispositions are considered to come from the bequest of one-third:
1. In the final illness which brought about X's death;
2. In military combat;
3. While travelling on rough seas in a storm;
4. As a final request before being killed; or
5. If X is a female, and dies while giving birth, or afterwards before separation of the placenta.
Otherwise, under any circumstances other than the above; or was, but the circumstance was not linked with X's death - then the disposition is not considered to be from the one-third of X's wealth for bequest.
Understanding the Major Difference Between Current Dispositions & Bequests
We distinguish between the above-mentioned current dispositions during one's life - e.g. gifts, waqf, donations, etc. with bequests by noting that - current dispositions are effective before X's death, while bequests are effective after.
Current dispositions are done, even if X uses up all his money to the extent that there is none left for heirs. On the other hand, as for bequests - unless X's heirs unanimously agree to allow any form of excess - are restricted to only one-third of the estate. Exceptions only come in when dispositions are announced during the death illness or other circumstance (exampled above), in which case they are limited to one-third of the estate, just as bequests are.