Will and Estates

Why have a Will?

Andrew Aitken and Ilana Kacev

Wills are often associated with the elderly, but what happens with the sudden and unexpected death of a young person? The last thing that a family wants in that instance is complexity or the risk of losing their home and income stream.

In a recent matter in which Wills and Estates specialist Ilana Kacev acted, a couple had just had a baby three months before the mother’s unexpected and sudden death. She did not have a Will. The deceased was living with her de facto partner and their baby in a house that she owned in her sole name. Her family did not like her partner and disapproved of their relationship.

Her father took control and made the de facto partner leave the home with their baby. Having nowhere to live and being unable to work because he had suddenly become the sole caregiver to the baby, the de facto partner moved into his mother’s home with the new born baby.

Meanwhile the deceased’s property remained empty and eventually the bank stepped in to repossess it, as no one was meeting the mortgage repayments.

The de facto partner was in a state of shock and was not able to deal with the legal aspects of the estate until close to a year later. The house was already sold by this time and he then received a letter from the father’s lawyer asking him to sign documents to enable the deceased’s father to apply for a grant of Letters of Administration.

In fact, the de facto partner (and not the father) was the most appropriate person under the intestacy provisions to make that application. Further, he and their baby were entitled to share in the estate, not the deceased’s father.

The deceased’s partner was entitled to the personal chattels of his de facto partner, the first $100,000 (plus statutory interest from the date of death until payment) along with one third of the residuary balance of the estate. The other two thirds of the estate was to go to the infant son, pursuant to the intestacy provisions of the Administration and Probate Act 1958 (Vic) (this was calculated under the pre 1 November 2017 intestacy provisions with any death after this date being dealt with under the new provisions).

If this occurred in New South Wales, the de facto spouse, would be entitled to the whole of the estate, pursuant to section 112 of Succession Act 2006 (NSW).

Eventually, a grant of letters of administration was made in favour of the de facto partner, enabling him to administer the estate, but not without difficulty. By that stage, the net sale proceeds had been sitting in the mortgagee’s trust account for a year, not earning any interest.

There were in fact sufficient assets in the estate for the de facto partner and infant son to ultimately jointly buy a house, but only after a few years of the partner and infant son living with uncertainty and angst. There were also complications with stamp duty.

If the deceased had a Will, everyone’s positions would have been clear, without the unnecessary complications and substantial legal costs incurred. The administration process would have been simplified and efficient.

The de facto partner and the infant son would also have had the opportunity to remain in the family home, should they have chosen to do so.

For any estate planning advice please contact Ilana Kacev or Andrew Aitken.

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