Complex issues can arise in blended families when a loved one passes away and those left behind have differing views as to who should receive the estate and what is considered a fair division of the assets among the surviving children. Attwood Marshall Lawyers Estate Litigation Senior Associate, Martin Mallon, discusses the ingredients of a family provision claim on Radio 4CRB’s “Law Talks”, and the sibling rivalry that can ensue when a parent of a blended family passes away, leaving their biological children and stepchildren to fight over their estate.
Disputes over inheritance – why contesting a Will is so common
It is extremely common for a Will to be contested by way of a Family Provision Application. It has been estimated that more than half of all Wills in Australia are contested!
There are several factors that contribute to the high rate of Family Provision Applications with many attributed to:
- the dynamics of the family
- a family member feeling aggrieved that they have not received adequate provision in a Will
- a family member being omitted from a Will due to estrangement, religious beliefs, sexual orientation or being the black sheep of the family
- the rise of blended families; and
- a Will-maker electing to use a “do it yourself” Will kit or an ‘online’ Will, or a ‘free Will’ from the Public Trustee, as opposed to obtaining advice from a lawyer who practices exclusively in this area who can provide the necessary estate planning advice;
- misconceptions or incorrect legal advice received on a person’s prospects of bringing a claim and likely amount
Many of the above issues are not considered when people try to go it alone and complete their Will using a “do-it-yourself” Will Kit from the local Post Office or completing an online Will. These types of documents are fraught with issues and are commonly contested following the death of the Will-maker, who has failed to seek proper advice from an experienced estate planning lawyer about their unique family circumstances and estate. Indeed, many lawyers are unaware of the complexities that can apply to drafting a Will that will stand the test of claims brought against the estate. A well-drafted Will must properly deal with the estate and non-estate assets. There are many strategies available to people making their Wills so that all bases are covered when it comes to dealing with the nuances of the modern family. The key is to take the time and effort to engage lawyers who know what they are doing in this space and plan for the future. In most cases, a ‘simple Will’, leaving everything to each other and then equally to the kids after you both die just does not cover all the contingencies of modern families, nor does it properly deal with the ‘standard’ family unit.
Is a stepchild entitled to contest a Will?
There is a lot of confusion around who is entitled to contest a Will and make a claim seeking further provision (otherwise known as a Family Provision Application) from a deceased estate when a loved one passes away.
This is particularly the case when a parent dies and is survived by biological and stepchildren.
It is common for sibling rivalry to exist between biological children over entitlements in their parent’s estate after their mother or father passes away, however when you throw stepchildren into the mix, it can become quite complex and contentious.
Depending on the wishes of the deceased and the relationships they held with all their children, the deceased may have written a Will that only leaves gifts to their biological children to the exclusion of their stepchildren.
This often occurs after a Will-maker’s partner passes away and elects to amend their Will leaving their estate entirely to their biological children, failing to acknowledge their moral duty to consider the financial well-being of their stepchildren.
In most jurisdictions, stepchildren are eligible to contest an estate by way of a Family Provision Application if they have been left without adequate provision for their proper maintenance and support under their stepparent’s Will.
However, each state and territory have different rules identifying who is an “eligible person” or considered a child of a deceased in the context of a Family Provision Application.
Queensland
Section 40 of the Succession Act 1981 (Qld) (“the Act”) defines a child of a deceased to be:
- A natural biological child
- An adopted child, or
- A stepchild
In 1997 the Queensland Parliament amended the Act by inserting an additional provision relating to the meaning of stepchild.
Under section 40A of the Act, a person is a “stepchild” of a deceased person if the person is the child of a spouse of the deceased person and a relationship of stepchild and stepparent between the person and the deceased person did not stop.
Importantly, the relationship of stepchild and stepparent stops on divorce, termination of civil partnership or ending of the de-facto relationship between the deceased person and stepchild’s parent.
Under the Act, the stepchild and stepparent relationship does not stop:
- if the stepchild’s parent died before the deceased person, if their relationship (marriage, de-facto relationship or civil partnership) remained when the parent died; or
- if the deceased person entered another relationship after the death of the stepparent, if their relationship (marriage, de-facto relationship or civil partnership) remained when the parent died.
This means that a stepchild has the same legal rights as a biological or adopted child, regardless of age if they meet the definition under S40A of the Act.
A stepchild is also eligible if they were wholly or substantially maintained or supported by the deceased person at the time on the person’s death and is a person under the age of 18 years.
New South Wales
In New South Wales, a stepchild can contest a Will if they can establish that at any particular time, they have been wholly or partly dependent upon the deceased; and at that particular time or any other time they have been a member of a household of which the deceased person was a member and the court is satisfied that there are ‘factors warranting’ the making of the application.
Victoria
In Victoria a stepchild can contest a Will if they fall under one of two categories (section 90(c) and 90(f) of the Administration and Probate Act 1958 (Victoria).
Under the first category a stepchild of the deceased is eligible if at the time of the deceased’s death they were:
- under 18 years of age,
- a full-time student under 25 years of age, or
- if they suffer from a disability.
If a stepchild does not fit within the first category because they are over the age of 25 or do not study full time, they are still eligible to seek further provision from their stepparent’s estate although a Court will take into account the degree to which the stepchild is not capable by reasonable means, of providing for themselves.
What happens if there is no Will?
Under the rules of intestacy, a stepchild does not have the same rights as a biological or adopted child. A stepchild has no entitlement under the rules of intestacy if their stepparent died without a Will.
In Queensland, an estate divided under the rules of intestacy will first go to the next of kin, which is usually the spouse or de facto partner, and children or grandchildren. If there is no spouse, children, and grandchildren, then the estate will go to the parents of the deceased, their siblings, nephews, nieces, then grandparents, aunts, uncles, and cousins.
Similar entitlements under intestacy apply under each state and territory’s legislation, but may differ as to the share each beneficiary will receive.
Although stepchildren have no entitlements under the rules of intestacy, if their stepparent died without a Will, they have standing to file a Family Provision Application seeking adequate provision from the estate for their proper maintenance and support.
The process of a Family Provision Claim
The time limitations that apply in Family Provision Applications are different in each state and territory.
- In Queensland, an applicant must give formal notice on the executor of their intention to file a claim for further provision within 6 months from the date of death.
- Within 9 months from the date of death, the applicant must file a formal application if the matter has not been resolved, seeking further provision from the estate.
- In New South Wales, an applicant has 12 months from the date of death to file an application for further provision from the estate.
- In Tasmania, an applicant only has 3 months from the date the grant of probate, or letters of administration, was made.
- In the ACT, Victoria, South Australia, and Western Australia, an applicant has 6 months from the date the grant of probate, or letters of administration, was made.
- In the Northern Territory, an applicant has 12 months of the date of grant of probate, or letters of administration, was made.
It is important for anyone who intends to make a Family Provision Application, seeks advice from an experienced lawyer as soon as possible.
From the outset, an estate litigation lawyer will review the deceased person’s Will, determine the assets and liabilities of the estate, obtain an overview of an applicant’s financial and health position and provide preliminary advice on whether a claim may be worthwhile to pursue.
If the estate is small and there are multiple beneficiaries, although it may seem unfair, it may simply be uncommercial to pursue a claim of this nature.
Once a lawyer has reviewed the case and determined if it is commercially viable to proceed, and an application is made, the court will set out a directions order which will set out what each party needs to file and when. The directions order will compel the parties to participate in mediation and promote an early resolution of the matter.
It has been reported that more than 80 per cent of family provision applications are resolved at mediation stage, with very few proceeding to trial.
If a dispute cannot be resolved between the parties, how does the court decide who gets what?
There are a range of matters that a court considers, and each case is determined on its own merits.
A court will not automatically put more weight in favour of a biological child over a stepchild.
The Court will look at a number of factors in determining a Family Provision Application. These include but are not limited to:
- responsibilities owed to the applicant by the deceased
- the size of the estate
- the financial and health circumstances of the applicant and any other beneficiaries;
- Need for further provision;
- Whether the stepparent’s estate has been derived in whole or in part from funds or resources of the natural parent of the stepchild;
- if any other claims on the estate have been made and who the deceased had an obligation to provide for
- if there is any other person who is responsible to support the applicant
- the relationship between the applicant and the deceased person, including factors such as estrangement or disentitling conduct.
Many people assume estrangement automatically excludes someone from making a claim on an estate, but that is not the case. Estrangement does not prevent someone from filing a claim, especially if the estrangement was caused by the deceased (see Palmer v Dolman [2005] NSWCA 361). This argument may even work in favour of the applicant if they can provide evidence that they tried to reconcile with the deceased during their lifetime but were rebuffed. All factors will be taken into consideration by the court.
Attwood Marshall Lawyers – helping you understand your rights in an estate dispute
If you are unsure if you are entitled to make a family provision claim or you don’t know what your rights are, it is important to get advice from an experienced estate litigation lawyer at the earliest opportunity. A lawyer who practices exclusively in this complex area of law will be able to review your claim immediately and help you understand your rights and if the matter is worth pursuing.
Be aware of time limitations! It happens all too often where people enquire about their rights to an estate two years, three years, or more, after someone has passed away, and they do not realise that they have missed their opportunity to claim what may have been rightfully theirs.
If you miss the time limitations set out by law, you will lose your right of action forever.
Attwood Marshall Lawyers can assist anyone who is intending to make a family provision application in any jurisdiction in Australia.
Find out where you stand by contacting our team today. Please call our Estate Litigation Department Manager, Amanda Heather, on direct line 075506 8245, email aheather@attwoodmarshall.com.au or free call 1800 621 071.
Our lawyers are available for appointments at any of our conveniently located offices at Coolangatta, Robina Town Centre, Southport, Kingscliff, Brisbane, Sydney, and Melbourne.
