Brisbane’s Legal Lowdown: Do all estate disputes end up in court?

Sofie: Twenty-five minutes to three on this beautiful, sunny afternoon. If you’re on the roads, do take care. Let us know if you see anything while you’re out and about. 133 882. That’s also the number to call if you would like to ask a question this week in our legal lowdown, it is time for Brisbane’s Legal Lowdown now with Attwood Marshall Lawyers.

And if you’ve ever unfairly felt like you’ve been left out of a loved one’s will, or you’re the executor of an estate that might be contested, then you might have wondered, will this end up in court? And if so, what happens and just how much would it cost? I guess is the thing that goes straight to my mind.

Today, we’re going to help to demystify the estate dispute process. Many people imagine are drawn out expensive courtroom battles. The reality is that most of the time, if there’s a claim like this, they’re resolved long before anyone has to step inside a courtroom or pay barrister fees.

Joining us now to talk about what happens during an estate dispute, Attwood Marshall Lawyers Estate Litigation Senior Associate, Duncan MacDougall.

Welcome back to Afternoons.

Duncan: Thanks for having me again.

Sofie: I’m sorry that both you know my mind very quickly twice during the introduction for you went to the cost that’s involved when there is a dispute.

And you know, some people are leaving a lot behind. Some people are leaving a little behind, and you know, the vast majority of people find themselves fighting over not a lot. And then if lawyers are involved that just becomes a much smaller piece to inherit or to fight over in the end.

Duncan: Yeah, that’s the thing. And with these sorts of family provision applications, when somebody has been unfairly left out of a will, the goal here is to resolve things early because like you said, the cost can blow out of proportion, the size of the estate may be nominal as well.

Everybody thinks it’s a dramatic courtroom showdown that the parties are going to enter into, when in reality there’s a lot of leg work that goes into before you even reach a courtroom. Ninety-five per cent of these things resolve before they even reach a courtroom.

Sofie: So talk us through what it looks like when someone feels like they’ve been unfairly left out of a will, does it automatically lead to, you know, lawyers needing to be involved, or sometimes things work themselves out quite quickly if everyone’s reasonable and there is a real claim to be made?

Duncan: I think the first point is to see whether or not they have grounds or even standing to bring a claim. There is certain legislative requirements there, and only certain category of people who are eligible to bring a claim in Queensland will generally apply to children, spouses. So, it’s really in figuring out, can they demonstrate need for further provision? What’s the size of the estate? So, there’s a lot of leg work in terms of what’s their position, what’s the estate’s position and what are the prospects down the line. And because we do this on a daily basis and we can see the general outcome, we can give those prospects pretty early on as to what to expect.

Sofie: You’ve mentioned a couple of times this family provision application. What is that and what happens when someone receives a formal notice of a family provision application?

Duncan: Yeah. So that’s a fancy legal way of saying, hey, listen, I’ve been left out of a will. I’m now putting up my hand to say I’ve been inadequately provided for under this will, whether it be a child or a spouse.

Sofie: Sibling?

Duncan: Sibling. Yeah, well not siblings in Queensland, so in Queensland there is certain eligibility of people who can make a claim. Partner or spouse, de facto partners as well, and kids. And the people who are financially dependent.

So, once you’ve satisfied that category, you give notice to an executor to say, hey, listen.

I’m wanting to obtain more from the estate and that has to be done within the six months from the deceased’s death.

Following that, you’ve got nine months from the deceased’s death to actually file proceedings. Now a lot of these things are going to be done before you even file any formal court proceedings. We want to resolve these things as early as possible before those things start to commence, because as soon as that happens, affidavits need to be prepared, as you mentioned earlier, barristers need to be engaged, and we want to resolve it early on.

Sofie: Yeah. At what point do the disputes that you’ve been had experience with, when do they typically get settled then if it doesn’t end up in court, like at what point? It’s like, okay, so you’ve put in your family provision application, clearly whoever needs to look at it makes the assessment. Says yes, there is actually a case here. And then what happens?

Duncan: Yeah. So generally, most of these things are resolved at or before mediation. So, you might get to a point where everybody’s pretty amicable, everybody knows what they’re going to be getting. They enter into a deed of settlement. Everybody signs away, happy days, It might take the steps, and this is what the court requires as well, as the parties have to attend the mediation before they even reach a courtroom.

So, it’s one of these things that the parties will come together, their legal representatives will come together. There’s this mediator who’s this intermediary who’s helping facilitate a resolution. He or she is not a decision maker. They’re simply just trying to get the parties together and to come to a resolution.

Sofie: And then seeing, sometimes there’s a little backwards and forwards until you come up with a solution that makes everyone happy. And we had a question that came in from a listener, Bob, earlier. He wanted to know in his case he says his sibling is disabled. Who would help him contest a will if he is in a situation where he isn’t left an equal share?

Duncan: It’s going to come down to the age of that sibling for one, it’s going to come down to kind of what the disability is and who may be handling that. So maybe he’s got a power of attorney in place, whether it’s the public trustee perhaps managing his financial and personal affairs, so that they can act on behalf.

Otherwise, there may be a litigation guardian who can be appointed to be the representative of that person in the event that they can’t make those calls themselves.

Sofie: And we also had a listener say you’ve mentioned age coming into it. Why is age a factor?

Duncan: Well, it comes down to a lot of times, a lot of people, anybody over the age of 18 can essentially represent themselves, instruct a solicitor. Whereas, until you’re 18, you don’t have that legal capacity.

Sofie: So, we’re not talking about the upper limit, we’re talking about the lower limit.

Duncan: Yeah. A lot of resolutions and a lot of times the court will even want a formal, what’s called, final orders, which is basically a court stamp of approval, especially if there’s a beneficiary there who’s under the age of 18.

Sofie: I find this really fascinating and this goes back to conversations that we have had in the past, and I think that there might be people listening for the first time, certainly to our conversation for the legal lowdown, because as a parent, you can make provisions and put your will in place and you can make, it would appear in Queensland, a concerted effort to, for whatever reason you choose, not include somebody in your estate planning. And what we have established through our conversations, which absolutely floors me, is that I die and this is, I mean when I say I, let’s just you know this is not going to be the case, I hope my children aren’t listening. But I pass away and then, if I’ve deliberately decided I don’t want part of my estate to go in a direction for whatever reason, that can be contested. And in the state of Queensland, likely upheld in the case that the person I didn’t want to have any of my estate, will likely get something.

Duncan: And that’s why it’s more important than ever to make sure your estate planning affairs are done before it even reaches that stage, before you pass away. Because getting that advice from a solicitor, the solicitor will outline all of those risks of what could potentially happen. There may be a restructuring of your actual estate there, especially if there’s estranged children, or if there’s somebody you don’t want to benefit.

Sofie: Step kids and all of that sort of stuff.

Duncan: Exactly.

Sofie: And this is the thing about then how you set up your affairs, so that you might not have everything you know, you might set up a trust, or you might gift some money before you pass so that you know that that money has gone where you want it to and you minimise the amount that could be disputed.

Duncan: And all you can really do is minimise the risk. That eligibility will always be there, but at the end of the day, if you look at somebody’s estate and it’s a nominal estate at the end, well, what’s their prospects to be successful in a claim? They may say they may be eligible, but their prospects are pretty low.

Sofie: Yeah. Craig would like to know, can someone claim after that nine-month mark that you mentioned?

Duncan: Yes, they can, but it’s a harder bar because you need the court approval, so you need to make an application out of time and the court would need to approve it.

Sofie: But there might be cases where, for example, that death had been kept quiet and not shared.

Duncan: And often the executor withholding information.

Sofie: So there may be something there.

Duncan: Yeah, there may be grounds there, but it’s more important than ever just to get in early so that again, that’s going to keep the cost down as well.

Sofie: Speaking of the costs, let’s get to the nitty gritty. When it comes to legal costs, what could somebody expect in terms of fees and how can that change depending on whether the matter settles early or has to proceed to the big wigs getting involved?

Duncan: Now when it comes to the cost, again that when you get to a point where everybody’s coming to a deed of settlement, the cost themselves will actually be negotiated as well. Who’s bearing what? So, it’s no guarantee the estate will pay everybody’s costs. Generally, sometimes even a factor in terms of what an applicant may receive as further provision will factor into their own legal costs as well. So, their settlement may be inclusive of their legal costs and it’s all going to come down to the stage the matter reaches at the end of day.

Sofie: And finally I think it would be really helpful, Duncan, to get some advice, or what would you say to people who are either thinking about the potential of having to challenge a will, or is an executor who is dealing with the potential of knowing that somebody is going to try and dispute it because that happens as well when families kind of have an idea, you know what the situation might be, and they’re just waiting for that person to pass, and then the will is read and everyone then gets a clearer understanding and they knew that it was coming and they’re ready to go all guns blazing.

Duncan: Yeah, well, as an applicant, the first thing to keep aware of is the things that you’re going to have to form part of your affidavit material or put to the other side to the executor. You’re going to have to prove that you’re in a financial need. So really detail all of your financial records, your personal circumstances, your spouse’s personal circumstances and their financial situation cause that will come into play. Your relationship with the deceased, some more information as to how you maintain a relationship with them while they were alive, the better.

On the other side of the line you’ve got the executors, who are in a bit of a middleman position, because they’ve got one duty to uphold the terms of the will and represent the beneficiaries and to try to come to an early resolution if a claim comes forward.

Sofie: Okay, this is a really interesting question, and we’ll leave it here because the question has been raised of what happens if your entire estate is being given to charity? Can people still contest it?

Duncan: Yes, they can. They can, I will say, just from experience, charities like to dig their heels in, and they will do anything they can to maintain that provision they’ve been given under a will. I had one that comes to mind. The person had we had some children who were just over the age of 18. Majority of the estate went to five different charities, some that were to be nominated by the executor themselves. Came to a mediation, still wasn’t resolved. Eventually came to a court and then at that point in time a resolution was reached.

Sofie: And did the kids get money?

Duncan: They did at the end of the day, but it’s probably not what they were expecting because you’ve got legal representation at every point in turn as well. So then costs start to accumulate and the estate starts to decrease.

Sofie: I can only imagine. Fascinating stuff. It’s the real-life stuff that many people watch for entertainment on television, and you live it every day and we do appreciate you coming in and listening to our questions, answering them for us and just reminding everybody that there’s no point of avoiding it because it’s unavoidable for all.

Thank you as always.

Duncan: Thanks

Sofie: And of course you can always send in questions in advance because every week we do the legal lowdown here on 4BC with Atwood Marshall Lawyers.