Challenges to Wills/estates

gco_last will and testament image

Note that the information appearing on this page applies to the State of Victoria, Australia.  The law relating to Will challenges in Australia is State based.

 

Who will be interested in this page?

Anyone who has been left out as a beneficiary in a Will and should have been included, or who has been included in the Will but has been inadequately provided for.

Anyone who believes they should be included as a beneficiary where there is no Will.

Areas covered:

  • Can I make a claim
  • How long will it take
  • Will I be liable for costs
  • What can I expect to get
  • When do I have to make the claim
  • There’s no Will
  • I was left something, does that end my claim?
  • Do I have to go to court

 

These claims are commonly known as Part IV claims or testator family maintenance claims.

NOTE: Prior to January, 2015, in Victoria, it was possible for anyone to make a claim on the estate of any deceased person.  This still applies in relation to deaths prior to 1st January, 2015.

For any death after this date, the categories of persons who can make a claim have been narrowed.

The main categories of “eligible” persons are as follows:

  • Spouses and domestic partners (at the time of the deceased’s death), and
  • Former spouses and domestic partners who could have made a claim under the family law legislation but either had not commenced such proceedings or had not completed such proceedings
  • Children or step-children (adult or otherwise)
  • Adopted children
  • (some) Persons who were treated by the deceased as a natural child and thought they were a natural child for a substantial period of time
  • Grandchildren, if they were wholly or partly dependent on the deceased
  • A registered caring partner
  • (some) Sons-in-law and daughters-in-law

(There are some further categories of eligible persons.)

Just because you are an eligible person it does not follow that you will necessarily succeed in a claim.  All relevant circumstances will be taken into account and there are certain qualifications in the new legislation which might disqualify a person otherwise eligible.

Eligible persons may be able to make a claim:

Whether or not:

  1. The deceased left a Will.
  2. The deceased made some provision in the Will for that person.
  3. The person claiming has any special financial need.
  4. The person claiming is the/an executor of the Will.
  5. Another person is also making a claim.

 

One of the qualifying factors in the legislation is that the deceased must have had a moral duty to provide for the claimant.

The Administration and Probate Act 1958 provides that “…at the time of  death, the deceased had moral duty to provide for the eligible person’s proper maintenance and support;” (s91(2)(c)).  The test adopted by the courts is whether a wise and just testator would have considered it his or her moral duty to make provision for the claimant.

The courts have, generally, interpreted this moral duty or obligation to be confined to close family members, or other persons with whom the deceased had a close, usually financial, relationship. In practice therefore for any other person to be able to make a successful claim, special circumstances must be shown.

It is not sufficient to defeat the intention of the relevant legislation for a testator to make a small gift (a “peppercorn” gift) to a person; the legislation provides that the provision (to an eligible person) must be proper/adequate.

If the deceased had not made a Will the laws of intestacy apply. This just means that the estate will be divided according to a formula set out in legislation. If the person claiming is not within the classes of persons included in this formula, or even if he or she is, it does not prevent the person making a claim on the estate, as long as some relationship existed that would create a moral obligation on the part of the deceased to provide for that person, and the person otherwise qualifies.

 

Is there a time limit within which a claim must be made?

Yes.  In Victoria a formal claim must be made within six months of the date of the grant of probate.  Parties can agree, without court involvement, to extend this time.

(A grant of probate is the formal recognition by the Supreme Court of the last Will of the deceased and the legal representative/executor appointed in that Will.  If there is no Will this legal recognition can be given to a suitable person – called Letters of Administration).

Can I find out if a grant of probate (or Letters of Administration) has been made?  Yes, details of all grants of probate are searchable on the Supreme Court of Victoria’s website

– http://scvprobate.com.au/probate/Search/ApplicationIndex.aspx.

 

Do I have to go to court?

No.  Claims can be dealt with without any court involvement – private settlements can, and often are, reached between the claimant and the legal representative of the estate.

If the time limit for making a claim is approaching (and an agreement for extension cannot be obtained) it will become necessary to institute a formal claim, however private negotiations can continue for up to a year after that without pre-trial procedures commencing.  (Brett, I only refer here to institute in formal proceedings, but not serving – the life of the Writ is 12 months – so you can effectively give yourself a year to continue with any negotiations that might be ongoing – I have used this technique before.)

Having made these observations however, a private settlement will often not be possible and court proceedings may need to be instituted at an early stage.

Nevertheless, the institution of court proceedings should not be taken as meaning an inevitable path to a trial – statistically the very great majority of cases are settled before court – very often at the Mediation stage.

Solicitors are always working towards settling claims whether or not court proceedings are on foot.  It is in fact the professional duty of the solicitor to do so.  The court process/prehearing procedures are designed to encourage/bring about settlement out of court.

 

What legal fees will be involved with?

It should first be said that the legal costs of a claimant who makes a meritorious/bona fide claim will in most cases have their costs paid out of the estate – this is what the court will usually order.

Even if privately settled without court involvement, the parties will usually agree that all legal costs be paid by the estate (again, for a meritorious claim).

For claims that are not bona fide/have doubtful prospects of success, a claimant may not have their costs paid from the estate and indeed risk having the court order that they also pay the estate’s costs.  This is no different from any other court case where the losing party generally is ordered to pay costs.  However, a claimant, in this area of law, may still have costs paid out of the estate even if the claim fails, as long as the claim was meritorious and a real question had to be determined by the court.

The question of legal costs is a critical one and is inherent in any legal advice provided to a person considering/making a claim.

These claims are usually, but not always, instituted in the Supreme Court and the costs of both sides will likely amount to some tens of thousands of dollars after a trial (although significantly less if the matter settles prior to trial).  The magnitude of court costs makes it imperative that sound legal advice is obtained.

 

Can you tell me how much I may obtain from the estate if I have a successful claim?

No.  What a court might award a claimant in this area is notoriously difficult to predict, or indeed whether the court will award anything.  It will depend, amongst other things, upon all of the factual, especially financial, circumstances between the claimant and the deceased, including all of the historical factual circumstances, the size of the estate and the competing claims of other beneficiaries.

A barrister experienced in this area recently said at a legal seminar – “My clients always ask me what they will get, and I always say I do not know.”

This difficulty predicting what a court will decide itself is an encouragement to settle out of court.  Most cases, probably well in excess of 80%, are in fact settled before trial, or without any court involvement at all.  A claimant may well take a little less when settling a claim rather than risk the uncertain outcome of the trial.

 

How long will a claim take?

This will depend entirely upon the circumstances of each particular case.  Some cases will be resolved at an early stage without any court process involved – perhaps within three or four months, but some cases may have to go to court in which case 18 months or more may be involved.  Cases can settle at any time.  If court proceedings are instituted the great majority of cases are resolved by the Mediation stage – most Mediations take place within twelve months of the institution of court proceedings.

 

Jargon buster:

Testator – the Will maker

Intestacy – an estate of a person who has not made a Will – the estate will be distributed according to a formula set out in legislation

Grant of Probate – the formal recognition by the Supreme Court of the last Will of the deceased and the executor/s of an estate

Mediation – usually a court ordered meeting of the parties to a dispute designed to explore settlement/resolution

Settle/settlement – the resolution of a dispute out of court

News & Interest
Financial powers of attorney – a trap!

Often a person making a financial power of attorney appoints two or more persons to act jointly.

Read Article
Pens – what colour?

Pens – what colour is acceptable to sign a legal document? We recently had a client who urgently contacted us saying that she had signed a document with a green pen, and…

Read Article
VCAT – applications for administration and guardianship

VCAT has power in some circumstances to make an order that a person be represented by another person. It can make either an administration order or a guardianship order, or both. Administration…

Read Article
Wills – gifts to children/grandchildren

Leaving gifts to children in Wills – something quirky: In Victoria if you leave a share of your estate to a child, and say nothing further, if that child dies before you…

Read Article
Invalid Wills

At a recent Wills session for the Salvation Army we were asked on a couple of occasions whether changing address invalidates a Will. It does not. Wills are actually drawn so that…

Read Article
Digital assets

Planning for the administration of digital assets by your executor after death is becoming an increasingly complex and pressing problem. What does an executor do with an online bank account? First, the…

Read Article
“Peppercorn” bequests in Wills

Can a “peppercorn” bequest prevent a Will challenge? It is often thought that leaving a very small bequest to a beneficiary will have the effect of preventing that beneficiary making a challenge…

Read Article
Court made Wills

In some circumstances the Supreme Court can make a Will for a person who lacks testamentary capacity. This power is given to the court in the Wills Act (Vic.). Such Wills are…

Read Article
Retirement village contracts

Retirement village contracts are a bit like marriage – they are a little bit harder to get out of than to get into. There is a variety of what are compositely called…

Read Article
Family Agreements

Family agreements, or more colloquially ‘granny flat agreements’ are predicted to become a more and more important part of the aged care landscape in the future. The harsh economic reality over the…

Read Article
Retirement village contracts

There was a recent article in the Age newspaper about some of the legal consequences of getting into and out of retirement villages. A spokesman for the Residents of Retirement Villages Victoria…

Read Article
Challenging a Will (in Victoria)

The law relating to Wills, and estate administration, is State based. Each State has its own legislation. Although there are many similarities between the States’ laws, there are also many differences. This…

Read Article
Accommodation Bonds – another myth

In the continuing series about accommodation bonds, we have myth number 2: Myth – I will lose a large part of the accommodation bond when I leave the facility. We are talking…

Read Article
Words of wisdom from oldest man

There have been many reports in the newspapers about the death of the world’s oldest man (and second oldest person). Walter Breuning died in the United States aged 114. He had some…

Read Article
More financial abuse of the older person

There was an article about financial abuse of elders in the Age on 1st April. Unfortunately, this was just one of several similar stories published in recent times. It drew attention to…

Read Article
Care required gifting to charities

The “Include a Charity” initiative is under way. It is directed at encouraging people to make a gift to charity in their Wills. I don’t think it is necessary to say anything…

Read Article
Let’s “advance”

A visiting American dignitary was recently interviewed on the radio and indicated that he was leaving a government position.  The announcer asked if he was going to retire. The dignitary’s answer was…

Read Article
Powers of Attorney – Attorney MUST keep records

Section 125D of the Instruments Act provides as follows: “Requirement to keep records An attorney under an enduring power of attorney must keep and preserve accurate records and accounts of all dealings…

Read Article
Our ageing population

Tim Colebatch recently wrote an article in the Age about our ageingpopulation and the future costs to the community of that process.The article was full of quite extraordinary (and some frightening) statistics.The…

Read Article
Legal capacity to sign documents

The capacity of a person, especially an older person, to execute legal documents is an important and quite complex topic for lawyers. If a Will, for instance, is signed by a person…

Read Article

Peter Gauld.

The Principal, Peter Gauld LL.B, has been a practising solicitor in Melbourne, city and suburbs, for thirty years.

He has a keen interest in the legal issues that affect the senior citizen.

He is, amongst other things, a member of the Elder Law Section of the Law Institute of Victoria and a volunteer Community Visitor for the Office of the Public Advocate.

He holds a Bachelor of Laws degree from the University of Melbourne, graduating in 1978.

He has a background in litigation.