In Brief
Who can make a claim against your estate? What needs to be established by the applicant? What will the court consider? Read on as we answer these important questions along with proactive strategies to help protect your estate.
Who can make a claim?
Chapter 3 of the Succession Act 2006 (Act) empowers certain persons, to make a claim against your estate where adequate provision is not made for them under your Will.
The Act entitles the following classes of persons to apply to the Court for a family provision order:
(a) wife or husband of deceased person,
(b) de facto partner of deceased person,
(c) child of the deceased person,
(d) former wife or husband of the deceased person,
(e) a person:
(i) who was, at any particular time, wholly or partly dependent on the deceased person, and
(ii) who is a grandchild of the deceased person, or was a member of the household of which the deceased person was a member,
(f) a person with whom the deceased person was living in a close personal relationship at the time of the deceased person’s death.
What needs to be established by the applicant?
In successfully making a Family Provision claim the applicant will need to establish that the provision made under the deceased’s Will, if anything, was inadequate for the applicant’s proper maintenance, education and advancement in life.
What will the court consider?
In Singer v Berghouse the High Court ruled that a two-stage process is required to assess a claim for provision under family provision legislation.
Stage One
The first stage considers whether the provision made, if at all, was inadequate having regard to, amongst other things; the financial position of the applicant, the nature and size of the deceased’s estate, the totality of the relationship between the applicant and the deceased, and the strength of the applicant’s claim when compared with other competing claims against the estate of the deceased.
Stage Two
The second stage is only considered if the Court forms the opinion at stage one that the provision was inadequate. The second stage requires the Court to decide what provision will be made out of the deceased’s estate for the applicant. This stage involves the exercise of discretion by the Court.
There are circumstances where the Court will refuse to make an order (at stage 2) notwithstanding that the applicant was found to have been left without adequate provision for proper maintenance (at stage 1). For instance, a matter the Court may have regard to when considering whether the applicant is an eligible person and whether to make a family provision order includes assessing the character and conduct of the applicant before and after the date of death of the deceased, what is known as “disentitling conduct”. Conduct that is disentitling is difficult to define. While family estrangement is a common cause for seeking a Family Provision order there are rare instances where the Court has failed to find in favour of the applicant.
Conduct that the Court has found did not amount to disentitling conduct includes the breakdown of the relationship between parent and child, even when the child caused the breakdown, or even the murder of the deceased by a child. However, while the Court found in Andrew v Andrew that the testator’s letter setting out the reasons for failing to make provision for his son was not sufficient to disentitle his son, the poor state of the relationship “operate[d] to restrain the amplitude in the provision to be ordered”. So while the Court may find in favour of the applicant the provision that the Court may order could be reduced due to the conduct of the applicant.
Time limit for claims
An applicant has 12 months from the date of death of the deceased to make a claim against the deceased’s estate. The Court may grant an extension of time where a ‘sufficient cause’ is shown.
Be proactive — strategies to help protect your estate
Having your Will drafted by a skilled lawyer trained in the area of Wills and Estates can help minimise the chances of a claim being made against your estate. We are seeing more and more family provision matters coming through our doors at Swaab, and in many cases, the Wills are almost always prepared by people themselves, without the assistance of a solicitor, using Will Kits or other basic documents, or prepared by lawyers who are not experts in the area of Wills and Estates. No solicitor will be able to prevent a claim altogether (unless a specific Court ordered release is obtained before death), but there is a lot that we can do to minimise the risk, and to ensure that our clients understand the risks, having regard to their own personal circumstances.
