Another Will one...

[Bsmirched]

Hello, this might be long, so I apologise.
My sister died in April 2020. A year before this, my mum moved in with her, putting the £200,000 from her own house sale into a £390,000 house that my sister and her husband were buying, by getting a mortgage on the remaining £190,000. My mum had to legally make the £200,000 a gift for them to get the mortgage, but the intention was that this would eventually go to my niece and nephew, my sister's children from a previous relationship.
My sister apparently left a will stating that her half of the house was to be left to her children, but we've been advised that legally the house automatically passed to her spouse on her death as theirs was a joint mortgage.
Fast forward to now and her widower has met someone else and has sold the house for £475,000, so £85,000 more than they bought it for in 2019.
He is, according to him, very generously giving my niece and nephew £40,000 each, which leaves him to wander off into the sunset with the £200,000 that my mum put into the house.
Now, I know that while this money was tied up in the house, the wishes of my sister had no legal standing, but does this change now the house is sold? I'm guessing not, but it's beyond frustrating that he can do this. Any thoughts/advice gratefully appreciated!

Having a joint mortgage was irrelevant as to what happened when your sister died. What mattered was how the house was owned.

If they were joint tenants, the house automatically became his when your sister died and her will has no effect - he can keep all the money if he wants.

If they were tenants in common, the house did not automatically become his. If that was the situation, your niece and nephew inherited your mother's share of the house. If there was a declaration of trust, that would govern how much of the house went to your niece and nephew. If there was no declaration of trust, they would be entitled to 50% of the equity, i.e. the amount left after paying off the mortgage.

Ok, thank you.