Who owns an item that is given before death but then upon death is bequeathed in their will to someone else who is already dead?

A will doesn't become active until the testator has died. The testator is free to give away property while living. Only property owned at death can pass under the will.

Many people don't update their wills. If the property was given to someone during the life of the testator then it can't become part of the estate. In this case, the testator may have given the property away because they new the person who was to receive it by the will had already died.

The recipient of the property owns it.