Have you ever considered what happens to all those hard-earned assets if you die without a Will?
In this podcast, Attwood Marshall lawyer, Lucy McPherson discusses what actually happens to all the things left behind if the deceased never got around to either doing a Will or ensuring it was up to date.
Dan: If you’re like most Australians, you’ve spent your life working hard, raising a family, and accumulating assets, but surprisingly many of us are nonchalant about what happens to those assets, and in particular where they should go after we die. I joined by Lucy McPherson, a lawyer with Attwood Marshall Lawyers. Lucy, lots of people die every day without having done a will. What happens to all the things that they’ve accumulated and leave behind?
Lucy: Well then, when you die without leaving a valid will in Australia, your estate will fall on what we call intestacy. Intestacy is a term that literally means a person who has died without a will. A person is said to have died intestate when no effective will has been left to dispose of the person’s property on their death and a person may die totally intestate or partially intestate.
Partially intestate is where some of that person’s property has not been disposed of properly by will. In either case, it is statutory rules which provide for the distribution of the person’s estate in the absence of an effective will.
Those rules, referred to generally as set schemes of distribution on intestacy, determine who is to receive and intestate’s property and how much each is to receive. There are default provisions which distribute the estate of a deceased person in the absence of a will and intestacy law is a matter governed by state and territory law, not federal law.
Lucy: There’s a general similar pattern throughout the states and territories although there is a degree of divergence also between those respective states.
Dan: Is it the case that this legislation will potentially give your assets to people that you don’t necessarily want to have them?
Lucy: Absolutely. It’s certainly something that can occur. Generally those first entitled under the schemes of intestacy distribution are your spouse and your children but it can fall down the line to your parents, siblings, aunts, uncles, first cousins, grandparents, so it’s quite broad reaching when you don’t actually have, say for instance you die without a spouse or without children, then your, if it is quite far reaching in relation to who would receive your estate in the absence of a will.
It is possible, although it’s very uncommon, if you die without leaving a surviving spouse, child, parents, siblings, grandparents, aunties, uncles, first cousins, you’re said to have died without leaving any next of kin and your estate is what we call bona vacantia and what that means is that the crown, or the government, is entitled to your estate. That’s a very uncommon scenario but it’s certainly possible.
Dan: I’m assuming blended families also add another dimension to this and it’s another reason why you probably shouldn’t die intestate, given that, you know, you might have an ex-spouse and there might be sort of stepchildren and all sorts of stuff going on in your little world that perhaps leaves things to people that, you know, you didn’t want them to have.
Lucy: Definitely, definitely. Look, I’ve had matters before where somebody has died still being legally married to somebody but separated and that former spouse has been entitled to their entire estate. Now that scenario is something that a lot of people probably wouldn’t like to happen, but under the rules of intestacy, that’s a matter of law, so it’s certainly something to be very careful of. That’s just, I guess, a horror story to tell, but it’s certainly possible under the legislation. Yes, it’s very important to make sure that you’ve got a valid will in place.
Dan: What about a time delay as well, like if somebody dies intestate, will the wrapping up of that estate take considerably longer given that there isn’t a will in place?
Lucy: Well, it depends on the circumstances. Certainly it can. It can take a lot longer. If it’s a fairly straight forward scenario where there’s a spouse and children, say for instance, and it’s very clear as to who’s entitled on intestacy, it may not take very long and it’s certainly probably the timeframe is comparable to that if you did leave a valid will. However, if it is not straight forward and the classes of those entitled perhaps isn’t very straight forward, then it can take a matter of years unfortunately.
Lucy: I can tell another horror story of a scenario where a person didn’t leave surviving spouse or children and searches had to be undertaken for a number of years to determine whether that person left any surviving relatives who were entitled on intestacy.
Dan: Wow. You would have to have rocks in your head not to do a will, to put it bluntly.
Lucy: Look, to put it bluntly, I tend to agree but the statistics are very alarming, Dan. I recall reading recently that up to 70 percent of Australians don’t actually have a current will.
Dan: Yeah, I know, it’s frightening.
Lucy: Very, very scary but I think a lot of people don’t realise the ramifications of not having a valid will in place but it’s important that people become educated about those matters because it’s their wealth, it’s their estates, that’s going to be brought into the spotlight and perhaps their loved ones that are going to suffer in the absence of a will.
Dan: Lucy, thanks for joining me.
For enquiries please contact Donna Tolley on direct line 07 5506 8241, email firstname.lastname@example.org or freecall 1800 621 071.