Estate challenges are becoming more common than ever, with all members of the family seeking a share of a deceased family member’s estate. Wives, children, stepchildren, siblings, de facto partners, ex-wives are fighting viciously for what they feel they deserve. Nautilus Law Group strives to provide peace of mind to our clients to avoid the financial and emotional costs of extensive litigation.
It’s my money – I’ll do what I want with it!
When discussing the obligations of provision with clients, the most common question we are asked is ‘why can’t I give my money to whoever I want?’ Freedom to dispose of property as you wish in your estate seems to be a fundamental right, and clients are often shocked when they become aware of the fact that there are strict limitations on this right.
The law must draw a fine line between ensuring that these rights remain upheld, and introducing limitations to protect those that need protection. It is a balancing act – ensuring there is proper provision for the support of people that require such support, and the freedom to deal with your property as you see fit.
In Queensland, the relevant legislation relating to the governance of this balance is the Succession Act 1981 (Qld). Section 41 of this Act provides as follows:
“41 Estate of deceased person liable for maintenance
(1) If any person (the deceased person) dies whether testate or intestate and in terms of the will or as a result of the intestacy adequate provision is not made from the estate for the proper maintenance and support of the deceased person’s spouse, child or dependant, the court may, in its discretion, on application by or on behalf of the said spouse, child or dependant, order that such provision as the court thinks fit shall be made out of the estate of the deceased person for such spouse, child or dependant.”
· a spouse;
· a child; or
· a dependant;
then the court may order that further provision be made for the person who is a part of such class. This section applies regardless of whether you have drafted a Will and clearly outlined your intentions in relation to disposition of your assets.
What is a spouse?
A spouse is relatively easy to define, and encompasses someone who is a husband or wife, a de facto partner, or a ‘registered partner’.
A de facto relationship is established where two people are ‘living together as a couple on a genuine domestic basis’. The court takes into account a number of factors when determining whether a de facto relationship exists. These factors can include:
· the length of the relationship;
· whether there exists financial dependence or interdependence between the parties;
· whether the relationship is publicly known or is made public;
· how property is owned and used, and assets managed; and
· whether there is a mutual commitment to sharing a life together, including providing care and support to each other.
In order for a de facto partner to be considered the spouse of a deceased person at the time of the death, the person had to have been residing with the deceased on a ‘genuine domestic basis’ for at least 2 years continuously prior to the deceased’s death.
A registered partner is a member of a registered relationship, being a legally recognised relationship regardless of the sex of the parties.
What is a child?
For the purposes of the Succession Act, a child includes stepchildren and adopted children of the deceased.
What is a dependant?
Perhaps the most important to define is the concept of ‘dependant’. As per the Succession Act:
“dependant means, in relation to a deceased person, any person who was being wholly or substantially maintained or supported (otherwise than for full valuable consideration) by that deceased person at the time of the person’s death being—
(a) a parent of that deceased person; or
(b) the parent of a surviving child under the age of 18 years of that deceased person; or
(c) a person under the age of 18 years.”
This definition essentially means that any person who relied on the deceased person for support or maintenance, whether entirely or only partially, is entitled to make a claim for provision against the estate.
What does this mean?
The number of classes of people who may be eligible to make a claim against an estate makes it important to carefully consider who may be eligible to make such a claim, and whether they have been adequately provided for in the Will.
A common scenario
We have a number of clients who, for whatever reason, wish to leave a greater share of their estate to one of their children. In most cases, this is simply because one child has made sacrifices for the care of the Willmaker, while the other child has lead a relatively independent life. The greater share is not intended to demonstrate a greater love for one child, but simply to provide compensation for the sacrifices given by that child.
Simply dividing an estate this way is insufficient for the purposes of protection of assets within an estate. An unequal split between children will, in many circumstances, result in a challenge to the estate when it is being administered.
Whether a claim against an estate is valid or not, the estate is still required to respond to such challenge. Solicitors are retained in order to defend such action, and potentially take the matter to court if required. Such action incurs legal fees which can cause an estate to dwindle rapidly. Thousands of dollars can be spent responding to a claim against an estate, and this form of litigation can go on for years. In addition to the costs, estate litigation is emotionally draining on families and can often cause irreparable damage to relationships.
How can Nautilus help me?
Nautilus Law Group prefers to see your money go where you intend it to go. Nautilus would prefer to see your assets in your estate distributed to your family instead of lining the pockets of an estate lawyer.
Nautilus provides our clients with peace of mind – we work with our clients to establish strategies to avoid estate challenges. We aim to arrange disposition of your assets in a way that is in line with your wishes, while also mitigating the risks that may cause conflict between family members.
Nautilus strongly advocates the preventative approach to legal issues, doing our best where possible to prevent situations of conflict arising. If you have a complex family situation, we encourage you to speak to us to ensure that your assets within your estate are protected.
