Attwood Marshall Lawyers Estate Litigation Partner, Lucy McPherson, recently joined Robyn Hyland for ‘Law Talks’ on Radio 4CRB to discuss a recent case where a beneficiary refused to accept the gift left for him in his late mother’s Will.
Being left a gift in a Will can be a pleasant surprise for some. For others, it can be an unwelcome burden from which they want to be relieved. It’s important to know that no one can be forced to accept a gift left to them in a Will. Beneficiaries have the right to refuse or renounce such gifts through a process known as a ‘disclaimer’.
There are several reasons why someone might choose to reject an inheritance. Sometimes, the gift comes with complications, such as inheriting a business with substantial debt attached to it. Other times, emotional factors play a significant role. For instance, accepting a bequest from an estranged family member might reopen old wounds or feel like you are forgiving that individual for past wrongdoings.
The emotional complexities of inheritance were seen in the recent case of Jensen v Mlynarik [2024] where a beneficiary chose to disclaim the inheritance of his estranged late mother.
An unwanted gift: Jensen v Mlynarik [2024]
The Supreme Court of Queensland recently heard the case of Jensen v Mlynarik [2024] where the deceased (Doris Mlynarik) died in March 2019, leaving behind a Will with instructions for her estate to be distributed to her three sons in equal shares.
The respondent in this matter was Richard, one of the deceased’s sons.
Richard had not been in contact with his family for several decades. He had been living in the United States of America since 1982. The last time he had seen his mother was in 1984 when she visited him; however, this visit ended with an argument. Following this, Richard became estranged from his family.
After Doris’ death in 2019, the executor of her estate (and applicant in this case) attempted to contact Richard about his inheritance through various means, including email, certified mail, and personal service. Richard did not respond to any of these communications.
He was set to receive one-third of his mother’s estate, an estimated $291,596.
Court’s Decision
The court declared that Richard disclaimed his inheritance because he was aware of the inheritance and the attempts made to reach him, and that he did not respond to any communication regarding the inheritance despite being informed that his inaction would be considered a “disclaimer”.
The court considered the long history of familial estrangement, and his silence was interpreted as a clear refusal of the gift.
The court focused on Richard’s inaction after October, 2023 when he was served with a letter clearly stating the amount of his inheritance, that there were no conditions attached to the gift, the gift could be paid immediately and crucially, that his inaction would be interpreted as a disclaimer.
In this case, the disclaimed gift was part of the residuary estate. This meant that Richard’s share of the estate would instead be shared equally by the remaining beneficiaries named in the Will, his brothers.
Common questions about disclaiming a gift
What are the usual requirements to establish the disclaimer of a gift in a Will?
For disclaimer of a gift to be effective, the disclaimer must be timely in that it must occur before any act constituting acceptance of the gift, the disclaimer must constitute absolute rejection of the gift, and the disclaimer must be communicated to the donor or the donor’s agent (in this case, the executors). However, a disclaimer does not need to be a formal act or reduced to writing and the conduct of a beneficiary can amount to or imply a decisive refusal of the gift.
Once a court has decided that a beneficiary has disclaimed their gift under a Will, can that individual come back at any time to try to claim it back?
Once a disclaimer of a gift under a Will is established through a court decision based on the individual’s silence, they cannot reclaim it later. A disclaimer acts as a permanent and irrevocable rejection of the inheritance.
In rare circumstances, if the beneficiary can prove fraud, undue influence, or mistake that significantly impacted their initial decision, they could petition the court for a chance to retract the disclaimer. However, such cases are rare, require substantial evidence and would be difficult to prosecute.
If someone disclaims their gift, can they choose who should receive it?
If someone disclaims a gift under a Will, they have no control over who will then receive that asset.
The executor handles the distribution according to the terms of the Will and relevant laws. Once disclaimed, the gift would usually fall into the residuary estate. If it was already part of the residuary estate, the remaining beneficiaries would typically receive the disclaimed share proportionally.
A Will can have specific instructions to control the distribution of a disclaimed gift such as naming an alternate beneficiary or distribution method. If there is no such provision, a partial intestacy might arise. Intestacy simply means how an estate or portion of an estate is distributed in the absence of any direction in a Will. Each state and territory have slightly different intestacy laws that apply and outline who receive what share of an intestate estate.
What happens if an heir cannot be located?
Executors are required to make a diligent effort to locate all beneficiaries. This can be challenging, especially if a beneficiary has gone missing or is presumed dead.
If an executor cannot locate a beneficiary, despite all efforts, and it is practically impossible to prove that beneficiary is alive, they can make an application to the court for a Benjamin order. A Benjamin Order is an order made by the Court declaring who is entitled to the estate and how that beneficiary’s share of the estate should be dealt with, in order to finalise the estate administration.
A Benjamin order will protect the executor from any liability if the heir does surface down the track.
Attwood Marshall Lawyers – experts in estate litigation
Whether you are the executor of an estate, or a beneficiary, if you are involved in a dispute over the estate, it is imperative to seek independent legal advice to understand your rights and the options available to you.
At Attwood Marshall Lawyers, we take pride in our highly experienced estate litigation team, with senior lawyers who practice exclusively in this complex area of law.
Our team handles family provision claims, applications for probate in solemn form, applications for construction and rectification of Wills, cross-border issues, and offers advice about the rights and roles of executors. We also assist in the removal of executors who are not performing their duties adequately.
For advice about your unique circumstances, please contact our Estate Litigation Department Manager, Amanda Heather, on direct line 07 5506 8245, email aheather@attwoodmarshall.com.au or call us free on 1800 621 071.
You can also book an appointment with our team using our online booking app.
