Law Talks Episode: What happens when your estate crosses the QLD-NSW border?

Robyn: Good morning and welcome to another edition of Law Talks here on 4CRB. Today we have a topic that potentially affects many of our listeners. Living on the Gold and Tweed Coast, it’s quite common for people to have their life spread across borders. Perhaps a home in Queensland, an investment property in northern New South Wales, or family members living in different states. But when someone dies, those state borders can suddenly matter a great deal.

Different succession laws, different probate process and different rules for executors can quickly complicate what families expect to be a straightforward process.

Today we’re looking at what really happens when assets sit in both Queensland and New South Wales, the hidden traps for families often don’t see coming and how careful estate planning can prevent costly disputes down the track.

We’re joined today by Attwood Marshall Lawyers Estate Litigation Partner Lucy McPherson. Good morning and welcome Lucy.

Lucy: Good morning Robyn. Thanks for having me.

Robyn: With it being quite a common occurrence for people owning assets across states like Queensland and New South Wales, given our close proximity to the border, how are these assets looked at under succession law?

Lucy: So Robyn, I guess the starting point for this discussion is that in Australia, our succession law is state-based legislation. Each state and territory in Australia has different succession law that applies in relation to the succession of property and wills and estates.

Now, given, as you’ve mentioned, our proximity to the New South Wales-Queensland border, we often come into a situation involving assets in multiple jurisdictions or perhaps even an individual who died in one jurisdiction owning assets in another.

So the interplay of these succession laws is really important.

Robyn: Can one will cover assets in multiple states?

Lucy: Absolutely, it can. Now, when we’re talking about different legislation, there are, I guess, different rules when it comes to cross-border issues when we look at the administration of an estate. So that is how your assets are administered in accordance with the terms of your will. And a different set of rules when we’re looking at challenges to an estate. So challenges under what we call family provision legislation when somebody’s seeking a greater portion of the pie.

So the law in relation to the administration of your assets, that’s going to be governed by, importantly, what we as lawyers refer to as domicile. And a domicile is a legal term for where somebody treated as their permanent home. And also where the assets are located.

So in some instances, particularly where there’s real property in different jurisdictions, it can be necessary to obtain or go through the probate process in both jurisdictions, in both states in order to be able to administer the estate effectively.

Robyn: And Lucy, can you give us an example of when an executor may face problems when estates cross over borders?

Lucy: Absolutely. Now, I just mentioned, look, there are a number of problems, I guess, that an executor can face in these circumstances, but I just mentioned bringing the potential for claims to be bought on an estate, what we call family provision legislation.

Where an individual who passes away has what we call these cross-border life, if you like, owning assets in one jurisdiction and living permanently in another, for instance, then claimants on the estate can potentially commence proceedings in both states.

Now that can cause a significant issue for an executor because they can be facing claims in multiple jurisdictions in relation to the one estate. That happened recently in the Supreme Court of New South Wales with an individual that was holding assets in both New South Wales and the ACT. And ultimately what had to happen was that those proceedings had to be what we call cross vested or joined in the one court because the one judge really ultimately needs to oversee all of the claims.

It becomes impossible for a judge to determine a family provision claim separately to another because both of those claims would affect ultimately the administration of the one estate. That’s just one of many issues that an executor can face in this sort of scenario.

Robyn: Are there situations where multiple grants of probate are required?

Lucy: Yes, sometimes when an individual owns assets in one jurisdiction, and what we find is often most of their assets will be in one state, but they may own, say for instance, a holiday home across the border. What we usually find in that sort of scenario is that an executor can go through the probate process in the main jurisdiction or in the main state, and then they may need to apply for what we call a reseal of a grant of probate, whereas that’s where the other court effectively authorises the grant that’s been issued in another state in order to administer the assets in the other jurisdiction.

Robyn: What are some hidden traps families don’t realise until after someone dies?

Lucy: The hidden traps in relation to cross-border laws is something that I don’t think a lot of people realise until they sit down in front of a lawyer.

You know, we live in Australia, we freely cross borders and we don’t think about the different laws that apply when you cross over the Queensland or the New South Wales border. So that’s certainly a hidden trap, particularly for families that are involved in these cross-border situations. And some instances where that can arise is, say, for instance, families that are separated and mums living on one side of the border and dads living on the other. Or a situation I often come up against is business owners, say, for instance, on the Gold Coast who live permanently on the Gold Coast but have a holiday home over in Byron Bay, you know, just across the border. So that’s a frequent situation that we come up against as well.

Robyn: And Lucy, how can people structure their estate planning to minimise disputes?

Lucy: The best advice for somebody who is in this situation, having their life spanning across multiple jurisdictions, is to get appropriate legal advice from somebody that has experience in dealing with these cross-border issues.

As I mentioned, unless you’re sitting down in front of a lawyer that has experience dealing with these cross-border issues that can arise, you’re really not going to have the right opportunity to be able to set your estate plan up to have minimal hassle and minimal cost to your family when you die.

Robyn: And what’s the biggest mistake you see in cross-border estates?

Lucy: I think the biggest mistake is probably leading on from the last question that you asked, Robyn, and that is people not getting the appropriate advice in relation to their estate plan and getting advice from somebody who is experienced within both jurisdictions. Often, you know, we can see that somebody may have gone to see a lawyer in Brisbane, for instance, in relation to their estate plan in Queensland, but forgetting about the assets that they may hold in another jurisdiction.

And if that happens, we do see problems because the other aspect of their lives is not being considered in the overall estate plan.

Robyn: Well, Lucy, thank you for your advice today and helping us understand that these issues dealt with early can make a real difference for families to help avoid unnecessary stress and delays and costs later on.

Lucy: No problem. Thanks for having me, Robyn.

Robyn: You’ve been listening to Law Talks here on 4CRB, which you can hear every Friday morning from 9 o’clock.