Attwood Marshall Lawyers Estate Litigation Senior Associate, April Kennedy discusses some of the issues involving contesting a Will, Wills and estate disputes generally, and how complex this area of law can be with Steve Stuttle on Radio 4CRB.
Introduction – Understanding estate disputes – Part 1
For the most part, many estate disputes can be avoided if you have proper estate planning legal advice with a qualified and experienced lawyer or law firm in this area of law.
This is where so many people get it wrong – by choosing not to make a Will or simply drafting a Will themselves without obtaining the right legal advice. Your estate can be left wide open to challenges down the track if you do not obtain assistance from an experienced estate planning lawyer. It is very important you do your homework and consult a law firm that is truly experienced in this area of law – don’t think that every lawyer can draft a proper Will and give proper advice! Getting a simple Will done cheaply with a lawyer does not ensure your estate will be free of disputes. This is a very complex and contentious area of law and there are plenty of widespread myths when it comes to estate litigation.
Misconception 1: Making a Will is expensive; I can just make one myself
Most people think that making a Will is expensive, so they’d rather do it themselves, or go to the post office and buy a Will Kit (DIY Will). In reality, a properly made Will by a qualified and experienced lawyer will cost less than most people realise and can ensure your estate is properly protected.
DIY Wills are very rarely made properly. They can cost tens of thousands of dollars to rectify and it is the grieving family who bears the emotional and financial brunt of this poor decision making.
The costs of a Will are determined by your individual circumstances and how complicated (or simple) your family dynamics are. For example, a couple who are on their second marriage and both have children from their first marriage will need far more detail in their Wills with possible life tenancies and trusts. Whatever the case, the relative cost of obtaining proper advice from lawyers experienced in this area is very modest in comparison to the usual insurance premiums we pay without question.
Read more: Estate Planning 101
Misconception 2: Anyone is entitled to see a deceased person’s Will
Unlike what you see in US TV shows, in Australia there is no legal requirement or customary practice to hold a ‘reading of the Will’. Our laws set out categories of people who are legally entitled to a copy of the Will.
Those entitled are:
- any person named in the Will;
- any person referred to or named in an earlier Will as a beneficiary;
- the spouse or domestic partner of the deceased at the time of their death;
- a parent, guardian or child of the deceased; or
- any person who would be entitled to a share of the estate if the deceased died intestate (without a Will).
If you fall into one of these categories, you can request a copy of the most recent Will or previous Wills of the deceased from the person in possession of the Will.
Read more: How to obtain a copy of the Will
Misconception 3: An Executor has the right to decide how the assets are distributed
An Executor does not have the power to change the way your estate is distributed in your Will.
The Executor’s role is to properly administer the deceased’s estate in accordance with the terms of the Will and in line with the deceased’s wishes. An Executor cannot interfere with the assets to the detriment of the beneficiaries, otherwise the Executor would be faced with very serious charges.
Read more: Executors behaving badly
Misconception 4: If my parents disinherit me, I have no rights to claim on their estate
One of the common things we hear children say is;
“I have no relationship with my parents, so I assume I am not entitled to any of their estate.”
Under the respective state and territory Succession Law in Australia, all children of the deceased are entitled to make a family provision claim on their parents’ estate. This includes biological, adopted and stepchildren in most states. Estrangement is always considered; however, it does not automatically preclude a person from claiming on their parents’ estate.
Misconception 5: Adopted children can claim on their biological parents’ estate
This is an interesting issue and something not many people are aware of. A child that was given up for adoption at birth, or shortly after, can claim on their adoptive parent’s estate, but they cannot claim on their biological parent’s estate. This is because their legal relationship with their biological parent was severed upon adoption.
In many cases, an adopted child and the biological parent reconnect later in life and commence a parent/child relationship. However, despite that renewed relationship, under the Succession Laws, that child is not formally acknowledged as a ‘child’ and therefore is not considered an eligible person.
However, in certain states an adopted child may be eligible to claim on the estate under another broader category in very limited circumstances.
That child’s right to inherit from a biological parent may continue if:
- the adoption occurred years after the child’s birth;
- after adoption, the child re-established a relationship with the biological parent and became financially dependent on him or her.
If you are an adopted child, or the parent, guardian or representative of an adopted child and are concerned about inheritance rights, it is important to discuss your matter with an experienced wills and estates lawyer as soon as possible.
Misconception 6: There are simple ways to disinherit a child I do not wish to leave provision for
If a parent or grandparent does not have a good relationship with a child and want to disinherit them, they often make some common mistakes to avoid providing for that child in their Will.
Some of the common mistakes often made include:
- A parent giving instructions to their remaining family members not to inform the disinherited child when they have died, hoping that the time limit to make a claim on the estate will expire;
- Giving away large sums of money to family before they die in an effort to reduce the size of their estate so there is nothing, or very little, to claim on;
- Transferring properties into their intended beneficiary’s name or into joint names, to remove it from their estate.
In some states, there are claw back provisions. This means that if assets have been removed from the estate with the purpose of reducing its value to avoid a claim by a disinherited child or person, then the Court can claw back those assets for family provision proceedings after death. This effectively reinstates the estate’s true value.
Misconception 7: If I leave a small sum of money to a child, it will be enough to stop them from contesting my Will
This is most certainly a myth. The classic:
“If I leave $1 to my son/daughter, then they can’t make a claim on my estate”.
Leaving a nominal amount to a person who is entitled to make a claim on your estate can do the opposite of what you expect. It can cause an inflammatory response and it is often the catalyst for that person to go ahead and take legal action. It is important to seek advice from an experienced estate planning lawyer to discuss the proper strategy to mitigate the risk of future claims.
Misconception 8: A parent must leave their estate evenly between all children
There is no set rule that children must inherit an estate in even shares. As a parent, it may seem like the right thing to do but it is not always so straightforward. It really depends upon the circumstances of each of the children and the relationships formed between parent and child.
Everyone’s situation is different. A parent may choose to divide an estate unevenly for several reasons, including:
- if one child is more financially stable than another;
- if one child has secure employment and another is unemployed;
- if one child has displayed poor financial judgement;
- if one child has had several bad marriages or relationships and the parent is concerned about protecting family assets;
- if one child suffers from a disability or chronic disease;
- if money has already been loaned to one child during their lifetime.
If the estate is divided equally then, it may not be fair to all children. A child who is disadvantaged may have grounds to seek further provision from the estate. Consideration needs to be given as to what is ‘adequate’ provision for all of the children in light of their circumstances. This can be difficult because people’s circumstances can change rapidly.
Misconception 9: I don’t need a Will; my family knows what I want and can sort everything out after I die
Unfortunately, this is a very common misconception. People without a Will often leave a mess for their family to clean up after they pass away. Without a Will, your family members will be unable to deal with third parties including banks, Centrelink, ATO, superannuation companies, government institutions or pay for debts from the estate. If a person does not have a Will; it is incredibly difficult and costly for the family to administer the estate.
Also, when a person dies without making a valid Will, then their estate is distributed in accordance with the rules of intestacy.
The rules of intestacy are a statutory formula which is set out in each State and Territory’s Succession Laws. This formula essentially predetermines the categories of persons who will inherit from your estate and what share or percentage they will receive.
Misconception 10: The only people that contest a Will are those who are trying to ‘rort’ the system
The general public attitude towards anyone contesting a Will is usually negative. A person who intends to contest a Will is often treated like they are ‘rorting’ the system, and they should just get what they’re given or accept that they have been given less or nothing at all.
However, the laws are designed to assist people who have not been adequately provided for.
There are many reasons why a person might contest a Will. These include:
- The Will may not have been updated to reflect current relationships and circumstances. For example: the Will maker may have had a falling out with someone many years ago, removed them from their Will and then reconnected years later. They may have forgotten to update their Will to reflect that;
- With respect to estrangement – the person who made the Will (usually the parent) may have been the cause of the estrangement. Family dynamics can be tenuous, and issues from childhood may resurface in adulthood. It is important to consider the type and quality of relationship the person had with the deceased which is why the Court will look at the history of the relationship from childhood up to death;
- The person is in dire financial circumstances, and the estate is large enough to warrant provision or further provision to be made. For example: the person may have had a rough life and they are living week to week, in housing commission, on a Centrelink pension and scraping the barrel to get by;
- There may be suspicious circumstances around the validity of the Will and how it was executed. We find this to be very common with DIY or post office Wills. For example: there might have been a third party (a friend, acquaintance, neighbour or even a family member) who has involved themselves in the Will maker’s life and was instrumental in making a Will that (surprise, surprise!) leaves most of the estate to them;
- The deceased did not have full knowledge or approval of the contents of the Will. The Will maker might have been blind or illiterate, or English may have been their second language;
- The deceased did not have the necessary mental capacity to make a Will, for example they might have been suffering from dementia or Alzheimer’s.
This list is not exhaustive but gives you an idea of some of the many reasons why Wills can be challenged.
How can Attwood Marshall Lawyers help?
Attwood Marshall Lawyers have one of the largest and most experienced estate litigation teams in Queensland, with senior lawyers who practice exclusively in this complex area of law.
We are here to help you get what you are fairly and legally entitled to or to uphold the wishes of the deceased if you are an executor in an estate.
Most estate litigation cases are accepted on a ‘no win no fee’ or deferred payment basis. There are no costs required upfront to commence your claim (subject to our determination of you having reasonable prospects of success).