The top six reasons why you should not use a Will Kit - Part Two

Estate Planning Wills and Will KitIn an earlier blog, The Top Six Reasons why you should not use a Will Kit – Part One, I explained the first 3 reasons why I think people should not use a Will Kit to record their last wishes. To recap, the six reasons are:

  1. Your wishes may not be carried into effect.
  2. A Will Kit does not cover all bases.
  3. A Will Kit does not deal with your superannuation funds.
  4. Estate Planning is more than just making a Will – what happens to your business and investment assets?
  5. A Will Kit does not cater for blended families.
  6. A Will Kit opens the possibility for challenges to an Estate.

Here are my final 3 reasons:

4. Estate planning is more than just making a will. It is not uncommon today for people to have various structures owning assets that sit outside of their estate. These structures include trusts and companies, which means any assets owned by these structures may not form part of your estate and will not be distributed in accordance with your Will. Wherever a trust or company is involved, it is important to seek the advice of a solicitor so that you ensure the assets pass to the intended beneficiaries.

A Will Kit does not provide for these situations and this creates potential for the control of your Trust and Companies to end up in someone else’s hands. For example, you may want your children or someone else in your family to take over controlling these structures and this may not occur.

5. A Will Kit does not cater for blended families. If you do not adequately provide for your spouse (including de-facto spouse) and your children (including step-children), those people will be entitled to make a claim against your estate. If you simply leave everything to your Children in your Will Kit, you could inadvertently be including your step-children whom you may not want to include. This is a complex area of law and a solicitor will be able to discuss with you the appropriate precautions to put in place to reduce a risk of a claim being made against your Estate.

6. A Will Kit opens the possibility for challenges to an Estate. Unfortunately, a Will Kit opens the doors for potential challenges to a person’s estate because the Willmaker does not understand this complex area of law. Then when you combine this with the ageing population making it easier to question a Willmaker’s “capacity” and people leaving beneficiaries out of their Will or a disproportionate to their loved ones, a Will Kit is an easy way to ensure your Estate will be challenged! The only way to avoid this, is to see a solicitor who can put appropriate measures in place to protect your Estate and have everything documented correctly.

If you want to correctly document your intentions and ensure your assets pass in accordance with your wishes, you should obtain the advice of an experienced estate planning lawyer. Please do not hesitate to contact me if you require assistance.

The top six reasons why you should not use a Will Kit - Part One

I often receive enquiries from individuals wanting to make a Will for the first time. They are often surprised to hear that making a valid Will is not a “five minute job”. This is often followed by a comment to the effect, “can I just use the Will Kit I purchased from the post office?”  Whilst I cannot stop people from using Will Kits to record their wishes, I strongly discourage it.

The six reasons I believe why a Will Kit should not be used, are:

  1. Your wishes may not be carried into effect.
  2. A Will Kit does not cover all bases.
  3. A Will Kit does not deal with your superannuation funds.
  4. Estate Planning is more than just making a Will – what about your business and investment assets?
  5. A Will Kit does not cater for blended families.
  6. A Will Kit opens the possibility for challenges to an Estate.

I have highlighted the first 3 reasons below and will provide the other reasons in a later blog to follow:

  1. Your wishes may not be carried into effect. A Will Kit is more susceptible to challenges as they can easily be misinterpreted and ambiguous if not drafted properly. A Will Kit is also less likely to be legally binding and executed correctly. It is important to note that a Will must conform to strict legal requirements otherwise the Courts may decide it is not valid. If that is the case, the Court will exercise its discretion and distribute your assets according to the law of intestacy, which may not be as you intended.
  2. A Will Kit does not cover all bases.  It is fine to want to leave “everything to your partner and kids” however what happens if you all pass away together at a family event or the Will Kit is not drafted correctly? If this were to happen, then your estate would be dealt with as “intestate”. This creates the potential for all of your  assets to pass to your partner’s family and your family may miss out. It will then come down to your partner’s family as to whether they decide to provide your family with a distribution.
  3. A Will Kit does not deal with your superannuation funds. Many people are under the assumption that their superannuation will automatically form part of their Estate and be distributed in accordance with their Will.  That is not always the case and you should consult an experienced estate planning solicitor to ensure your funds are protected.

I will address the remaining three reasons in my next blog. If you want to correctly document your intentions and ensure your assets pass in accordance with your wishes, you should obtain the advice of an experienced estate planning lawyer. Please do not hesitate to contact me should you require assistance.

The Importance of Reviewing your Will

Having a Will is one thing but having an up-to-date Will is another matter completely! Whilst I find that there is a general reluctance amongst people to make a Will in the first instance, I find people are even more reluctant to review and update it. Further, a lot of people do not see the need to review their Wills or, continually put it on the never ending “to do list”.

The fact is, circumstances and relationships change and this will have an impact on your Will. Unfortunately, case law shows that challenges to Wills are on the rise and in a lot of circumstances, could have been avoided by simply reviewing and updating the existing Will.

Generally, I recommend that people review their Wills every two or three years or whenever a major event occurs in their family, their assets or the taxation laws. Regular review of your Will ensures that it is up to date with your life and also current legislation.

Whilst there are many circumstances in your life that may trigger the need for a review of your Will, the following should prompt you to contact a solicitor and discuss updating your Will:

  • If you change your name, or anybody named in the Will changes theirs;
  • The purchase or sale of a significant asset;
  • The death of a family member or of people you have nominated as executors or beneficiaries in your Will;
  • The birth of a child or grandchild;
  • Marriage or divorce; or
  • An inheritance or significant change to your financial circumstances.

If you need to make, update or review your Will it is important to do it properly and with the correct legal advice. Please do not hesitate to contact me if you require assistance in this regard.

What is the difference between an informal codicil, assignment of an interest and a renunciation/disclaimer?

You may recall my recent blog post about documenting your intentions correctly. In that blog, I gave a brief overview of the recent Queensland Supreme Court decision of Gamer v Whip [2012] QSC 209 (30 July 2012).

In that case, the Court had to consider whether a document signed by a beneficiary was an informal codicil, a renunciation of a beneficial interest in another person’s will or an assignment of an interest in an Estate.  The Court ultimately decided that the document was an assignment of an interest, but only after much discussion surrounding the wording of the document. I have discussed the three issues considered by the Court further below:

The Issues to be Considered

1. Was the document an “informal codicil”?

An informal codicil is, for example, informal writings found after death (such as a note of items dated and signed by the testator).  These type of documents are not recommended as they are usually found not to be legally binding.  For a document to be legally binding, it must comply with the execution requirements contained in the Succession Act.  However the law also allows the Court to dispense with these requirements, where the document purports to state the testamentary intentions of a deceased person.

In this case, the Court considered whether the document showed the testamentary intentions of Ms Page.  The Court found that, despite the use of the word “bequeath”, Ms Page’s intention from the document and by her sending it to the executor, was to give her share of Ms Atkinson’s estate to Ms Christiansen and Ms Jensen rather than herself.

2. Was the document a “disclaimer” or “renunciation?

The Court conceded that the use of the word “relinquish” may suggest, at first glance, that the document is a disclaimer however was not satisfied that the whole document constituted a disclaimer.  The Court was also not persuaded that the document was a renunciation based on Ms Page’s intentions for the share to go the other named beneficiaries.

3. Was the document an “assignment”?

The Court considered whether Ms Page had intended to assign her beneficial entitlement on the basis that she had done everything necessary to effect such a transaction (by putting it in writing, having it witnessed by a JP and giving express notice to the executor).

Seek Legal Advice

The matter is an important reminder to seek proper independent legal advice when contesting or disputing a Will. It also shows the need to consult an experienced estate planning solicitor when you want to amend your will.

If you require assistance with making a new Will, or updating an existing Will, or if you are a beneficiary or executor of an estate, it is important to obtain experienced advice.  Please do not hesitate to contact me if needed.

Document your intentions correctly to avoid challenges to your Will

I recently read the Queensland Supreme Court decision of Gamer v Whip [2012] QSC 209 (30 July 2012), in which the Court had to decide whether a particular document was an informal codicil to the deceased’s will, a renunciation of a beneficial interest in another person’s will, or an assignment of an interest in an Estate. It highlights the importance of correctly documenting your intentions to avoid a challenge to a Will.

Background

The facts of this case are as follows:

  • Prior to her death, Ms Atkinson left a detailed will leaving a specific percentage of her estate to Ms Page and other parts to Janet Christiansen and Monica Jensen. Ms Atkinson passed away on 26 October 2011 and Probate was granted.
  • When Ms Page found out she was a beneficiary of Ms Atkinson’s will, she was very ill and frail.  Accordingly, she decided to write to the Executor of Ms Atkinson’s will, advising that she would like her share to go to the other two beneficiaries.
  • The Executors of Ms Page’s estate brought the matter to court for determination and submitted there were 3 possibilities:
    1. That the document was an informal codicil to Ms Page’s Will; or
    2. That the document constituted a “disclaimer” or “renunciation” of Ms Page’s entitlement under Ms Atkinson’s will; or
    3. That the document was an “assignment” of Ms Page’s interest in Ms Atkinson’s estate.
  • Ms Page’s step-son (a minor and beneficiary of Ms Page’s Will), argued that the document should form part of Ms Page’s estate.

The Courts Decision

After consideration, the Court decided that the document was not an informal codicil or a disclaimer or renunciation.  The Court found that the Ms Page intended to assign her interest in Ms Atkinson’s estate to the other named beneficiaries.

Seek Legal Advice

The matter is an important reminder to seek proper independent legal advice when contesting or disputing a Will. It also shows the need to consult an experienced estate planning solicitor when you want to amend your Will.

If you require assistance with making a new Will, or updating an existing Will, or if you are a beneficiary or executor of an estate, it is important to obtain experienced advice.  Please do not hesitate to contact me if needed.

Challenging a Will in a Family Provision Application

If you are involved in a dispute over a will, or challenging a will, the case of Catelan v Herceg [2012] QSC 320 (25 October 2012) will be of interest. The Court had to decide whether to allow an application from the Executor to dismiss a claim from a wife for further provision from an Estate. The decision highlights the importance of regularly reviewing and updating your Will to avoid family members contesting your Will.

Background – Challenging the Will

  • The deceased passed away leaving a substantial estate (estimated between $27 – $60 million);
  • He left a Will leaving his furniture, art works, house and contents and the sum of $2 million to his wife (whom he had been married to for 4 years);
  • His wife cared for him whilst his illness deteriorated rapidly and they lived a “comfortable” lifestyle;
  • Leading up to his death, he spoke with his lawyers about amending his Will to give further provision to his wife (including his companies) which resulted in a draft Will being drawn up, but never signed;
  • The wife challenged the Will on the basis that she had not been adequately provided for (despite having received more than what she was originally entitled to from the first Will);
  • The executor of the will made an application to the court to have the wife’s challenge “dismissed”.

Contesting the Will – Grounds for Dismissal

The executor argued that the challenge to the Will should be dismissed because:

  • The marriage was relatively short – they had only been married for 4 years;
  • The fact that the second will had not been signed indicated that the deceased did not intend his wife to receive further provision than what he had already provided her;
  • The wife did not “need” the further benefit as she had already been provided assets worth $4.5 million which is “adequate” provision for her.

The Court’s Decision

In coming to a decision, the Court stated:

  • The shortness of the relationship should be seen in perspective – the only reason their marriage was cut short was because of the death of the deceased from an illness diagnosed after the marriage, and the fact that the wife had cared for the deceased until his death;
  • The fact that a second Will had been produced suggested that the deceased intended to make substantial further provision to his wife;
  • Whilst the wife was well-established financially, there was the issue that she could not presently meet her personal outgoings.

In light of the above, the court was not satisfied that the executor had established a “prima facie” case for the wife’s application for further provision to be dismissed.

The wife’s dispute to the Will has not yet been finally determined. We will wait to see how the Court’s deal with this contest about the Will. If you have any questions regarding challenging a Will and Family Provision Applications, please don’t hesitate to contact me.

The Effect Of Renunciation Of An Executorship

I recently read the Queensland Supreme Court decision of Micallef v Micallef; Arrowsmith v Micallef [2012] QSC 239 , in which the Court had to consider the effect of three step-children renouncing their interest in the estate.

Background

The facts of this case are as follows:

  • Prior to his death, Mr Dumesny left a will providing a life interest to his wife (Lauretta) and upon her death “the rest residue and remainder” of his estate was to be divided equally between his two children (Chevonne and Matthew) and three step-children (Robert, Silvano and Adriano). Effectively, each child had a one-fifth interest in the estate.
  • Mr Dumesny nominated Chevonne and Robert to be the joint executors of his estate.
  • Mr Dumesny (the deceased) passed away on 19 September 2010 and Lauretta filed a family provision application for further provision from his estate.
  • As a result, Silvano and Adriano signed renunciation forms and Robert signed an affidavit, stating that they wished their shares of the estate to go to their mother (the deceased’s wife).
  • The family provision claim was settled and final orders were made by the court, ordering a release from all claims on the estate.
  • Silvano and Adriano then sought directions so that Lauretta could receive three-fifths of the residuary estate as agreed and an order that Chevonne and Matthew receive a one-fifth share each.
  • Chevonne disagreed with this and argued that Silvano and Adriano did not have sufficient standing to seek directions and that each “renunciation” was in fact a “disclaimer” by which the interests of Robert, Silvano and Adriano fell into the residue of the estate, and should be distributed to herself and Matthew.

The Issue to be Considered – Did the “Renunciation” constitute a “Disclaimer”?

What is a Renunciation? A renunciation is the formal rejection of a claim or entitlement to something. By signing the renunciation forms, Robert, Silvano and Adriano intended to waive their entitlement to their one-fifth share of the residuary estate, provided it passed to their mother (Lauretta).

What is a Disclaimer? On the other hand, a disclaimer is a term that describes an attempt by a person to renounce their legal right to benefit from an inheritance.  In this case, Chevonne argued that the forms signed by Robert, Silvano and Adriano were in fact “disclaimers”.  If the Court found the forms to be “disclaimers” instead of an effective renunciation,  Robert, Silvano and Adriano’s interests would pass to the residuary estate and benefit Chevonne and Matthew only.

The Court’s Decision

The Court decided that the renunciations were not disclaimers and Robert, Silvano and Adriano’s interests did not pass to the residuary estate to benefit Chevonne and Matthew.

The Judge ordered that Lauretta receive the family provision as settled and three-fifths of the residuary estate and that Chevonne and Matthew each receive one fifth of the residuary estate.

Seek Legal Advice

The matter is an important reminder to seek proper independent legal advice when considering renouncing your entitlement to an inheritance.  It also shows the need to consult an experience estate planning solicitor when dealing with life interests and blended families.

If you require assistance with making a new Will or updating an existing Will, or if you are a beneficiary or executor of an estate, it is important to obtain experienced advice. Please do not hesitate to contact me if needed.

Cultural and religious considerations when making a Will

I have read with interest the matter of Omari v Omari.  Mrs Omari passed away in 2009.  One of her children challenged the validity of Mrs Omari’s Will on the grounds that Mrs Omari lacked testamentary capacity to make her Will (due to alzheimers/dementia).   The judge determined that Mrs Omari did not have testamentary capacity to make the Will.

However, the matter has also generated discussion on Sharia Law (the traditional moral and religious law of Islam) and the making of a will.

Some of the evidence put forward in the matter was that:

  1. Mrs Omari was aware that she was making a will in accordance with Islamic faith and traditions.
  2. The Will was prepared by one of Mrs Omari’s sons using a precedent by a former imam.
  3. A practicing Muslim was obliged to make a will according to Islamic guidelines.
  4. That the standard expectation is that a Muslim will leave full shares to sons and half shares to daughters.

Because the judge found that Mrs Omari lacked testamentary capacity to make the Will, and that her Will was invalid, there was no need to address whether Mrs Omari’s Will adequately provided for all of her children, or whether it was fair.  However, the judge did accept some of the evidence in relation to the expectations within the Muslim faith as to how an Estate will be divided where the Will maker has children.

The matter highlights the importance of:

  1. Testamentary capacity when making a Will;
  2. Making sure that a Will maker understands their Will;
  3. The intention of the Will maker.

Whether a Will maker is making a will based on cultural, religious, family or other considerations, the intention of the Will maker should be clearly outlined.  This should be done in the Will and also through a further Statutory Declaration.  If these intentions and the reasons for those intentions are not clearly set out by the will maker, a court will look at the following when deciding how to divide an Estate:

  1. The Will;
  2. The intentions of the Will maker;
  3. The assets of the Estate; and
  4. The personal and financial circumstances of the beneficiaries.

This could result in an outcome which is very different to what the Will maker intended and what a beneficiary may have expected under the Will.

If you would like to discuss the preparation of your Will, have been left out of a Will, or if you would like to update your Will to more clearly set out your intentions, please do not hesitate to contact me.

Do you have the capacity to make a Will?

I have recently come across families wanting to make wills for their elderly mother or father. Whilst this is achievable, it must be done to minimise any risk of a challenge to the validity of the will. Also there must be under no undue influence or pressure. It is important to keep in mind that the instructions need to come from the person making the will. A solicitor should ask family members to remain outside whilst taking instructions.

Where elderly clients are involved, it is also a good idea for the client to undergo an assessment of their capacity to make a will with a qualified medical practitioner, before providing instructions and signing the will. This protects the Will-maker and the beneficiary from any claim on incapacity.

What is “capacity”?

The Courts have held that the qualities necessary to possess capacity to make a Will can be summarised as having “sound mind, memory and understanding”. The phrase, “sound mind” is a good general description.  However, various cases have elaborated on the issue and have identified the critical elements of “sound mind” in this context. They are the ability to:

  • Understand the nature of making a Will and its effects;
  • Understand the extent of the property of which the Will maker is disposing;
  • Comprehend and appreciate the claims to which you ought to consider. For example, a person making their Will must know who could potentially make a claim;
  • There should be no disorder of the mind and no insane delusions in influencing the disposal of the estate. It must also be remembered that a person who generally lacks testamentary capacity may, during lucid intervals, have the requisite capacity to make a Will.

What happens if I don’t have “capacity”?

Where a person is not of “sound mind”, when a Will is made, the Will can be set aside and the next earlier Will in time becomes the person’s last Will and testament. If there is no earlier Will, then applications to the Court can be made by family members for letters of administration/intestacy (where a person dies without a Will).

How do I avoid this?

It is critical to have a written report from a medical practitioner to confirm a person’s capacity as this will help reduce the risk of a Court finding that the testator lacked the requisite capacity. Using a solicitor with experience in this area to draft the Will and be present for its execution will also help avoid later problems and disputes.

If you need assistance with drafting a Will, or have any questions about capacity, please do not hesitate to contact me.

Mutual Wills and Blended Families

Mutual Wills date back to the 18th Century and have long been considered a good estate planning mechanism for couples who want to reach an agreement that effectively provides neither party will change their Will without the knowledge or approval of the other. However, a risk with creating Mutual Wills in today’s society arises due to the increase in the divorce rate and couples going into second and third marriages, or re-marrying after the death of a spouse.

What is a “Mutual Will”?

A Mutual Will is not a “Mirror Will” and it is important to keep that in mind when doing your estate planning. An experienced and qualified solicitor will be able to help you address whether a Mutual Will is required for your situation.

A Mutual Will is a legally binding contract between you and your partner, and because of this, it needs to be properly documented. This means that upon your death, there is a legally enforceable document that ensures your spouse passes your assets to your intended beneficiaries.

What are the advantages?

Many people think when they go to a solicitor and create a Will they are creating a Mutual Will, when in fact, they are actually creating a Mirror Will (For example, they wish for their assets to pass to their spouse and then when their spouse dies, it will go to their children and vice versa). But what happens when you pass away and your spouse re-partners or remarries?

Unfortunately what is becoming common in blended families is that instead of the assets passing to your children as originally planned, the assets instead pass to the new spouse (and possibly new children) and your children miss out. A properly drafted Mutual Will ensures that your assets pass to your intended beneficiaries, regardless of future relationships.

What are the Disadvantages?

The basic key element of a Will is that it should be able to be revoked or amended at any time. Unfortunately a Mutual Will takes away that right to a certain extent. Further, a Mutual Will may be completely useless where the intended beneficiaries are completely unaware of its existence (for example, they may have been minors at the time of signing the Will). In those instances, the intended beneficiaries may not be in a position to enforce it.

What are my other options?

There are alternative ways to ensure that your assets pass to your intended beneficiaries upon your death.  These include:

  1. A testamentary discretionary trust;
  2. Transferring assets directly to intended beneficiaries; and
  3. Putting life insurance policies/superannuation in place for the benefit of your intended beneficiaries.

There is a lot of discussion and commentary about the advantages and disadvantages of entering into a Mutual Will. A Mutual Will should not be entered into lightly as they can become out of date easily and place a heavy burden on your loved one.

If you are considering entering into a Mutual Will, be sure to contact me. Our experienced solicitors can take you through the advantages and disadvantages and prepare the appropriate document that will protect you and your loved ones.

Informal Wills

What is an Informal Will?

An informal Will is a Will that does not conform to the formal requirements of the relevant estate law. For example, it may have been incorrectly signed or witnessed or it may be an electronic document. Whilst the Court does have the power to grant Probate for an informal Will, it can cause a lot of stress and expense for your loved ones. There is also the uncertainty as to exactly what your wishes are, and whether the Court will actually find that the informal Will is in fact your last Will.

There have been some recent cases where people have left informal Wills and it has been left to the Courts to determine whether the Will was valid. Theses cases highlight the need for people to have a properly executed will.

The Background of the Frizzo case

  • Mrs Frizzo was 81 years old and changed her Will after her husband passed away to heavily favour one of her son’s;
  • Mrs Frizzo was admitted to hospital for surgery after a fall;
  • In the days leading up to surgery she experienced days of “incoherence and delirium” however on the day of surgery, she had significantly improved;
  • Just before surgery, Mrs Frizzo asked her doctors and nursing staff to make a Will for her;
  • Her wishes were written down on a piece of paper and read back to her;
  • She stated she wanted to make the changes so that everything was fair;
  • Her “will” was then taken away with the hospital nurse and misplaced;
  • Only a copy of the will was found.

The Issues

Firstly, did Mrs Frizzo have capacity at the time of making the will? For example, was Mrs Frizzo in the right state of mind to make decisions that deal with her legal rights and make a Will? A doctor’s report is usually required for this.

Secondly, did Mrs Frizzo have the intention for the informal Will to be her last Will and testament? As Mrs Frizzo had made an earlier Will, the Court had to be satisfied that she intended for the Will made in the hospital to be her final Will and testament. It has to be more than just a thought.

The Decision

The Court ultimately decided that Mrs Frizzo did have capacity to make the Will that she intended it to form her last Will, but only after lengthy discussions over the evidence provided by the doctors. If it was not for the doctor’s evidence, there is a strong possibility the Court could have decided otherwise and the Will would have been invalid.

You should regularly review and update your Will however it should be done properly. An informal Will, in most cases, will not be granted probate and it will be left to your loved ones, or the Court, to determine your wishes. This could mean your assets are distributed against your wishes.

If you wish to change your Will you should consult an experienced solicitor. A properly executed Will allows for the simple transfer of your assets and can reduce the risk of a claim being made against your Estate. If you require assistance with amending your Will, please do not hesitate to contact me on (07) 5443 6600.

Should Reserve Beneficiaries be listed in a Will

When people prepare a Will, they sometimes may not consider what will happen to their Estate if all of the beneficiaries listed in the Will are no longer alive to benefit from the Will.

In this situation, the balance of the Will maker’s Estate, known as the residuary Estate, will be given to the reserve beneficiaries.  If a Will maker decides not to list reserve beneficiaries, the Will maker’s Estate may pass to family members who the Will maker would never have imagined could benefit from their Will.

For example, a Wife lists her Husband as a beneficiary in her Will and if he passes away, then her Estate is to be left to their Son.  The Wife has listed no reserve beneficiaries in her Will as she believes that her Son will still be alive to inherit her Estate once she or her Husband have passed away.

However, if the Wife, Husband and Son were all to pass away at the same time, then there are no beneficiaries alive to inherit the Wife’s Estate.  The Estate would then be given to the reserve beneficiaries.  As there are no reserve beneficiaries listed in the Wife’s Will, the Estate may be distributed as follows:

1. Where the parents of the Will maker are still alive:

  • The parent is entitled to the whole of the residuary estate, or if both parents are alive, they are entitled to the whole of the residuary estate in equal shares.

2. Where the Will maker is not survived by a parent, but is survived by a next of kin:

  • The next of kin is entitled to the residuary Estate – that is, the Will maker’s brothers, sisters (and their children), grandparents, uncles and aunts.

3. Where the Will maker has no surviving children, parents or next of kin that are still alive:

  • The residuary Estate will be deemed to have no owner and the Crown, or State Government, will be entitled to receive the Will maker’s entire Estate.

Accordingly, if all of the beneficiaries in the Will have passed away and no reserve beneficiaries are listed, then the Will maker’s Estate may be given to people that the Will maker would never have considered to benefit from their Will.  As a result, it is important to consider listing reserve beneficiaries when preparing a Will.

For information on including or adding reserve beneficiaries to your Will, or Estate law in general, please do not hesitate to contact me.

Electronic Will - The Importance Of Signing Your Will

Electronic Will Estate Planning Litigation Lawyers Brisbane Sunshine Coast Gold Coast QueenslandIs an Electronic Will a Will?

I recently read an interesting case from the Supreme Court of Queensland called Mahlo v Hehir.

In that case the Deceased had typed on her home computer a document in the form of a Will, two weeks prior to her death. The Will appointed her brother as Executor and allowed for gifts to her parents, along with the balance of her Estate to her son and daughter.

The Will was not signed.

The Deceased had a previous Will made approximately three months earlier, where she appointed her then de facto as Executor and Beneficiary of her Estate.

The Deceased’s children sought an Order from the Court that the electronic document was in fact the Deceased’s last Will, rather than being in a situation where the Deceased’s former de facto was the sole Executor and Beneficiary of her Estate.

The document was an electronic document. The Succession Act allows for an electronic document to be determined as a Will.

There was no evidence of the electronic document being printed. On the face of it the document purported to state the Deceased’s intentions , however, an issue arose as to whether the document was made by the Deceased or her daughter. The issue of testamentary intention therefore became evident.

The Respondent in this matter, Mr Hehir, was a financial planner and neither admitted nor denied that he had drafted the clause in the February Will leaving a residence owned by the Deceased to him.

One month after the February Will, Mr Hehir rented an apartment, however, he continued to sleep at the Deceased’s house.

The Deceased had indicated to other family members that her relationship with Mr Hehir had ended.

Importantly, on 8 May 2008, Mr Hehir emailed the Deceased, attaching a copy of previous Wills indicating that he had recreated her Will for her. Mr Hehir asked the Deceased to send a copy of the Will for him to peruse to ensure that it still met with the legal criteria before resigning it.

There was a lot of evidence lead as to discussions and communications had between the Deceased, family members and Mr Hehir in relation to the electronic Will.

In deciding the question as to whether or not the electronic document was a Will, the Court found:

  1. The question is whether the electronic document was intended by the Deceased to form her Will;
  2. The Court was not satisfied that the Deceased intended the electronic document to form her Will. The Court found that the Deceased knew that in making a new Will she had to do more than type or modify a document on a computer. She understood that she had to sign it.
  3. The Deceased had a fairly recent experience in making a Will, which was signed and witnessed.
  4. The electronic document made specific provision for where the signature was to appear and be witnessed, and the Deceased had been reminded by Mr Hehir of the necessity for her signature.
  5. The case was different to the case of Re Trethewey, where the Deceased had said on several occasions that he had left Will on his computer. The Deceased, in this instance had described a paper document as being her Will.

The Court dismissed the claim that the electronic Will formed the last Will of the Deceased. The result of this was that the former de facto benefitted generously from the Deceased’s Estate, over and above the Deceased’s children.

This case serves as a timely reminder to ensure that:

(a) Your Will is updated if personal circumstances change; and

(b) You act quickly to ensure that your Will is prepared properly, with qualified legal advice; and

(c) Your Will is executed promptly to ensure there is no argument as to what your intentions are.

If you have any questions in relation to this particular matter, or finalising your Will, please do not hesitate to contact me.

Can Scandalous Words Be Removed From A Will After Death?

Scandalous Words Will Estate Lawyer Brisbane Gold Coast QueenslandA recent decision in the Supreme Court of South Australia handed down on the 20th July 2011, “In the Estate of Brummitt (deceased)”, highlighted to me the importance of properly drafting your Will if you wish to include reasons as to why you have left a person out of your Will.

In the case of the Estate of Brummit, an Application was made in the Supreme Court of South Australia to remove words from a Will of the deceased.  In the Will:

a) The deceased directed that his former wife shall not take any benefit from his estate;

b) He declared that he has “no further obligation to her in any circumstances”;

c) He declared that he had not provided for his former wife’s child as he believed that his former wife “had extra marital affairs” and the child was not his child;

d) Both child and his former wife refused to conduct a paternity DNA test.

For obvious reasons, the former wife did not want these particular words to be included in the Will that was to receive the final approval from the Court as the deceased’s last Will.

The judge refused to remove the reference to “extra marital affairs” and admitted the Will in its signed form. A summary of the legal principals relating to this issue are as follows:

  1. In the first instance the Courts will issue Probate in the words of the Will itself;
  2. A person making a Will has the right to provide reasons as to why (or why not) the will maker is disposing (or not disposing) of their property;
  3. The will maker cannot use the will as a vehicle for defamation, scandal or offence, where those words have no effect upon the Will, or the disposition of property;
  4. Generally, the two criteria that need to be met before the Court can exercise its power to omit the words are:
    a) The words cannot be interpreted to have the effect of disposing of assets within the estate; and
    b) The words must be capable of being characterised as scandalous, offensive, defamatory or blasphemous;
  5. It is a discretionary power of the Court to determine whether to omit words, on a case by case basis.
  6. The power of the Court must be exercised with great care and so generally, in so far as words provide or support a reason for the will maker’s decision, they ought not to be omitted from the Will. It follows that where the words assist a Court interpreting the Will, the Court may decline to omit them.

In this case, the application failed because removing the words “extra marital affairs” would have rendered the rest of that particular clause incomprehensible.  The Court held “in the circumstances of this case this level of interference with a testator’s testamentary affairs would be disproportionate the offensive or scandalous character, if any, of the words used”.

How does this affect your Will?

This case highlights the importance of getting properly qualified advice if you wish to leave people out of your Will. It is very important to express the reasons why people are left out of your Will. My recommendation is to leave a detailed statutory declaration as a separate document to your Will. The benefits of this are:

a) It is a separate document to your Will, meaning that your Will may not meet the same challenges that were faced in this particular case; and

b) It is a sworn document that can be relied upon as evidence (if prepared properly) in the event that there is a dispute over an estate, and the will maker’s reasons.

If you have any queries in relation to this particular matter please do not hesitate to contact me.

Codicil or New Will?

Codicil New Will Estate Planning Litigation Lawyer BrisbaneA codicil amends, rather than replaces, a previously executed Will. Such amendments may add or revoke small provisions of the Will, or may completely change the majority, or all, of the gifts under the Will.

Historically, the concept of a codicil arose as a time saving exercise given the expectations that legal documents were to be completed in original ink in the same hand. With the electronic document production technology available to modern legal practices however, a new Will can be quite easily prepared and as such will in most cases be preferable to a codicil.

In considering the use of a codicil, testators should be advised of the following:

  1. If the existing Will is relatively lengthy and the proposed alteration is not complex, a codicil may be appropriate. If however, the existing Will is quite short and uncomplicated, the drafting of a new Will may seem more appropriate.
  2. Where the existing testamentary documents consist of a Will and numerous codicils, it would be prudent to create a new Will to consolidate all of the testator’s intentions.
  3. If the testator’s circumstances have changed so that the original will is substantially affected, a new will should be prepared. This is because a codicil republishes the existing will to the date of the codicil to the extent that the provisions of the existing will are not inconsistent with the codicil. An example of this may be, if the testator’s marriage has been terminated after the Will, a codicil could create problems by inadvertently confirming the provisions in favour of the former spouse by providing a contrary intention.

Another point to note is that, if the testator’s intention is to deprive a beneficiary of a benefit under an existing Will, a new Will would most probably be preferable. If the testator was to elect for the use of a codicil it would be apparent from the terms of the existing will when read alongside codicil that the testator had changed his or her mind. This may cause distress to the disappointed beneficiary upon becoming aware of the deceased’s subsequent change of heart. If you have any questions regarding codicil or Will’s, please don’t hesitate to contact me.

Disputes about Burial and Testamentary Capacity

Estate Litigation Wills Estates Brisbane Gold Coast QueenslandI read an interesting article written by Kay Dibben in the Sunday Mail on 1 May 2011, about four siblings who went to court within days of their father’s death, stopping his funeral and burial.

James Maurice Hoolahan, aged 82 at the date of his death, changed his Will a month prior to his death, leaving nothing to his four surviving children, instead leaving his entire Estate to other relatives who had cared for him.

Mr Hoolahan passed away on 6 April 2011, and on 11 April Mr Hoolahan’s children won an injunction that restrained the Executor from burying their father until after an autopsy was carried out on his body. The siblings also requested for their father be buried next to their mother and brother.

Where a dispute arises as to a deceased’s burial, and these instructions have not been provided for in the Will, the final say in relation to the burial or cremation will be left with the Executor. This is because, although there is no ownership of a person’s body, there is a right of possession in the Executor for the purpose of disposal of a body.

Despite the siblings request for their father to be buried next to their mother and brother after the autopsy, Mr Hoolahan was laid to rest in the same plot as his parents. It would appear that the Executor exercised his right of possession of Mr Hoolahan’s body in this case to override the siblings request.

In order to avoid disputes after death in relation to funeral and burial arrangements, it is important to leave detailed instructions in your Will.

In addition to the injunction, Mr Hoolahan’s children also filed a caveat against any grant or order to administer the estate. From the facts it appears the children intend to challenge their fathers last Will on the basis he lacked testamentary capacity because of his “frailty, drinking, depression and illness”.

Testamentary capacity is a complex issue and the highest degree of capacity is required for the making of a Will. In order for a Will to be admitted to probate, it must be shown that the willmaker had sound mind, memory and understanding. However, even where a person lacks general testamentary capacity, they may still make a valid Will if they recover capacity to do so temporarily, that is, during a lucid interval.

If the children are successful in proving their father lacked testamentary capacity to make his last Will, the last Will would be invalid and Mr Hoolahan’s estate would be distributed in accordance with his previous Will, of which the children were beneficiaries.

Where there are any concerns about a person’s testamentary capacity, it is essential that medical evidence is sought at the time of obtaining instructions, and also when executing the Will, to prove the willmaker understands the nature and effect of the Will, and their instructions.

In this case, there appears to be evidence from a doctor who saw Mr Hoolahan just before he made his last Will, that he did in fact have full testamentary capacity. If that is accepted by the Court, and there is no other evidence put forward to prove that Mr Hoolahan did not have capacity, the Children may have a difficult time setting aside the will in dispute. If you have any questions regarding anything above, please don’t hesitate to contact me.

What happens when a person dies without a Will (ie Intestate)?

Family Estate Litigation Wills Estates Lawyer Brisbane QueenslandI was recently asked by Tim Moore of Business and Estate Planning specialists as to what happens when a person dies without making a Will, and how is the Estate of the deceased person distributed?

This is a very good question and highlights the need to have a valid and binding Will so that upon your death, the assets that form your estate go to the people you want them to go to.

“Intestacy” is defined in the Queensland Succession Act as meaning a person who dies and either does not leave a Will, or leaves a Will but does not dispose effectively by will of the whole or part of his or her property.

Firstly, an application will need to be made to the Court by the surviving spouse or children seeking an Order that the Estate be distributed in accordance with the intestacy rules.

Generally speaking (there are some other specific nuances in this area) the intestacy rules are as follows:

1. Intestate survived by a spouse

The spouse receives the whole of the Estate.

2. Intestate survived by spouse and children

The spouse receives a base entitlement of $150,000 and the household chattels. After this amount is allocated then the spouse receives an additional one half or one third of the remainder of the residual estate, depending on the number of surviving children.

If there is one child, the spouse and the child would each be entitled to one half of the remainder of the Estate. If there is more than one child, then the spouse receives one third of the remainder of the Estate and the children share the other two thirds.

 3. When the intestate is not survived by a spouse but is survived by children

If there are surviving children they are entitled to the whole of the estate in equal shares.

 4. When the intestate is not survived by a spouse or children

If there is no surviving spouse and no surviving children then:

  1. the parents, followed by;
  2. the next of kin (which includes siblings, grandparents, aunties, uncles, nieces, nephews, and first cousins of the deceased), and then;
  3. the Government,

are those entitled to the residuary estate.

It is therefore very important, given the broad definition of “next of kin”, and the fact that your estate could go to the Government, that a properly drafted and signed Will is completed. If you have any questions regarding a Will, please don’t hesitate to contact me.

How to Properly Sign a Will

Signing a Will Estate Litigation Planning Lawyer Brisbane QueenslandI was recently at a professional development training day with Business and Estate Planning Specialists, when the question was raised as to how a Will can be validly executed.

Formal Requirements for signing a Will

Section 10 of the Succession Act (Queensland) deals with the formal requirements for the signing of a Will. I will outline these requirements and point to some interesting cases.

  • A Will must be in writing – this includes many modes for representing or reproducing words. In The Estate of Slavinski, a will written on the wall of a house was admitted to probate. In Kell v Charmer, a Will written partly in code was admitted to probate;
  • A Will must be signed by the will maker or someone else at their direction and in their presence – it is important to show the intention of the will maker to execute the will. It follows that the actual form of the signature is not as important as the intention to execute;
  • A Will must be signed in the presence of 2 or more witnesses – this requirement has somewhat been relaxed but it is, in my view, still very important to have 2 witnesses present at all times during the signing. The witnesses however do not need to know that the document they are witnessing is a will;
  • The signature must be made or acknowledged by the Will maker – this is usually implicit, but in the case of Goods v Gunstan it was found that a signature that was covered up and not shown to the witnesses could not have been acknowledged;
  • The signature must be made with the intention of executing the Will – I will deal with this issue below when discussing Courts dispensing with these formal requirements, but in essence the Will maker must intend that the will be his/her last Will;
  • There is no need for the signature to be at the foot of the Will – however it is desirable to continue this practice and also have a proper signing clause.

Similar provisions to this exist in other States of Australia, however it is important to look at the Law in each State for specific issues.

Dispensing with the Formal Requirements

A Court may dispense with the formal requirements for executing a Will in Queensland if the court is satisfied that the person intended the document, or part of it, to form their Will (or an alteration or revocation).

In Re Garris the Court noted that the essential test for a Court is:

  1. Was there a document embodying the testamentary capacity of the deceased; and
  2. Was there sufficient evidence to satisfy the Court the deceased intended the document as their Will.

In that case a deceased committed suicide and the court was satisfied, after receiving sworn affidavits from a Solicitor and the applicant, that a handwritten signed document was intended to be a Will.

In The Will of Stephen James Hodge, the Court held that a willkit signed by the deceased (but not witnessed) and found in his truck, was a valid will, after considering handwriting evidence, and evidence of the actual date of death to ensure the will was made before death. The document also had the words “These are my final wishes”.

Each case is decided on its own facts, and would have cost the Estates considerable amounts of money in legal fees to argue before the Courts. It is therefore very important to ensure that Wills are properly signed. Please don’t hesitate to contact me if you have any questions regarding your Will.