A string of high-profile Australians – including former Prime Minister Bob Hawke, NSW Premier Neville Wran and cricket icon Richie Benaud – have been the subject of Supreme Court stoushes about their messy estates. Such disputes can tear families apart.
It may be tempting for some to save on lawyers’ fees and pick up a cheap do-it-yourself will kit at a newsagency, but experts warn it is in everyone’s best interests to properly consider and map out one’s estate.
Under the Succession Act 2006 (NSW), spouses and children are automatically eligible to make a claim for provision in the deceased’s estate. In given circumstances, others may also be able to challenge a will.
NSW has the most generous estate provisions of all states and territories, especially when it comes to notional estates. In the case of insufficient funds in an estate, a court can look to assets that were gifted by the will-maker during their lifetime for less than market value, or those held in structures that were controlled by the now deceased. Examples could include jointly-held property or a superannuation death benefit.
There is sometimes little that can be done to make an estate completely watertight. It could involve having a conversation with family and friends, in making a will, as to how to divide up assets and having a court sign off, but many would consider that a fairly morbid approach and perhaps also hitting a nail with a sledgehammer. The other option is to die with no estate and to divest all of your assets in the three years before death. But taking this approach also requires a total trust in the people (the assets are divested to) and human nature is that sometimes people do the wrong thing.
Consideration will be given to the value of the estate, as well as the wealth of each person who is benefitting. This applied in the estate of Australian cricket legend, Richie Benaud, whose long-time wife Daphne lived in a waterside property, while his ex-wife and son were residing in public housing.
If someone is considering leaving someone out, the decision needs to be made as to whether to exclude them outright or to leave them something that may or may not be considered adequate. If someone is left something, obviously there is a chance they can challenge it and a court can find it was not adequate. But it is a much easier leap to challenge if they are just left out entirely.
As an example, an older couple who retired to a regional town and assisted a struggling man with accommodation in return for help on their property. When they died, the man was found by the court to have a moral claim on the estate, as he had come to rely upon them during their lifetime; a decision that most likely surprised the couple’s surviving adult children.
With blended families and children from multiple relationships, there is a natural tension that exists in those two pools of beneficiaries. And if someone is left out, they feel like their parent didn’t love them like their other kids.
Often the issue for the court to decide is weighing up the competing interests of the testator’s freedom of testamentary disposition against their duty to make proper provision for the claimant. For specific advice regarding your specific circumstances, you should consult your solicitor.
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