Wills, Trusts, and Estates
Ademption
Ademption by extinction is a taking away or revocation of a devise that traditionally happens when a specific devise cannot be fulfilled.
Identity Theory
Under the traditional identity theory of ademption, specific devises are extinguished if their specifically devised item is not in the testator's estate.
The theory behind the identity theory is that if a testator did not want the ademption, he would have amended his will after losing the property.
Intent Theory
Under the newer intent theory of ademption, if a specifically devised is not in the testator's estate, the beneficiary is still entitled to a replacement or cash value of the item if he can show that this is what the testator would have wanted.
This can mean that you get a much more valuable piece of property. E.g., if someone drives a beautiful 2006 Chevy Malibu, devises it in his will, and then trades it in for a Ferrari, the devisee is entitled to the replacement Ferrari.
Satisfaction
Satisfaction is when one gives willed property to his devisee as a gift before dying. Traditionally, gifts between executing the will and death are presumed to be in satisfaction of the will.
I.e., if one wills $50,000 to his son, then gives his son $30,000 before dying, his son will only get $20,000 from the will.
Satisfaction only applies to general devises. If items of specific devises are given before death, the devise is adeemed by extinction, not satisfaction.
It is basically the testate equivalent of advancements.
Like with advancements, the UPC greatly limits satisfaction by requiring testators' intent to adeem by satisfaction to be shown in writing. UPC § 2-609.