SOME THINGS YOU SHOULD KNOW ABOUT WILLS

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Publish Date: February 2005

A Will has no operation until you die, so that if you are worried about what happens if you can no longer look after your own affairs during your lifetime, through old age or injury, your Will is of no help. An Enduring Power of Attorney can address this aspect.

Normally you can revoke or change your Will whenever you like, but it is possible for you to make a commitment or contract, for example with your spouse, not to change your Will.

A Will is automatically revoked by marriage, unless the Will is expressed to be made in contemplation of marriage.

A Will survives divorce, but any gift to the ex-spouse is deemed to be revoked unless the Court is satisfied the Willmaker did not intend the gift to be revoked by the divorce.

A well-prepared Will deals with the property you have at your death, so that assets you acquire after you make the Will are covered.

A Will can be challenged as to its validity, the main grounds being:

The Willmaker was not of sound mind, memory and understanding to make a Will at the relevant time – this could be through senile dementia, some other type of metal illness or a temporary incapacity such as being under the influence of alcohol or drugs.

The making of the Will has been affected by duress, undue influence or fraud.

A Will may be valid, but nevertheless liable to challenge under the Family Provision Act – this legislation, which also applies where there is no valid Will, gives the Supreme Court power to make provision out of the estate where the deceased person had a duty to make provision for a person and has not carried out that duty. The persons who can apply to the Court are:

Spouse

Person with whom deceased was living in a domestic relationship at the time of death (including same sex relationships)

Children

Former spouses

A grandchild who was at any time wholly or partly dependent on the deceased

Any other person who has at any particular time been wholly or partly dependent on the deceased and also, at any time, a member of a household of which the deceased was a member.

If you die without leaving a valid Will, your estate will be distributed, subject to any claims under the Family Provision Act, to your next of kin according to the rules of intestacy; the rules are complex, but basically the potential beneficiaries include a current spouse or de facto spouse, children (including those born “out of wedlock”), adopted children (but not stepchildren) parents, brothers and sisters, nephews and nieces, and uncles and aunts. If there are no such persons, the estate will go to the Crown. Obviously you should ensure you have a valid Will so as to avoid your estate passing to persons you do not wish to benefit.

Normally the formal requirements for a valid Will are that it be signed by the Willmaker and witnessed by two witnesses (not being beneficiaries) each of whom must be present when the Willmaker signs and must sign in the Willmaker’s presence – the rules are rather technical and the prudent course is for the Will to be signed at your solicitor’s office.

There are special rules applicable to particular circumstances – for example if the Willmaker is illiterate, physically incapable of signing or blind.

The Supreme Court now has power to dispense with the formal requirements for validity of a Will if satisfied that the deceased person intended the document to constitute his or her Will. Recently Staunton & Thompson were able to obtain probate of a Will handwritten on the back of a postal wrapper which was signed by the deceased but not witnessed by anyone, although the estate was a large one and the Will was apposed by several next of kin who did not benefit under the Will. The Court’s dispensing power also applies to documents of revocation or amendment that do not satisfy the formal requirements.

If the estate includes substantial assets, it is likely that the Will cannot be implemented until the Supreme Court has made a grant of probate of the Will; in the case of an intestacy, the equivalent is the grant of Letters of Administration to one or more of the next of kin, or a creditor.

Normally a Will appoints one or more executors, whose duties include collection of the assets, sale of assets where appropriate, payment of debts, payment of legacies, distribution of assets or proceeds of sale to other beneficiaries, holding monies in trust for infant or incompetent beneficiaries.

The decision as to whom to appoint as your Executor(s) is an important one. You can appoint your spouse or a relative or trusted friend or the Public Trustee or some other trustee company or persons with whom you have a professional relationship such as your solicitors or accountants. The Public Trustee and trustee companies commonly offer to prepare your Will free of charge, but “there is no such thing as a free lunch”; this service is normally conditional upon you appointing them as your executor and following your death very substantial commission/fees, depending on the size of your estate, may be charged. Staunton & Thompson can advise you on selection of executors.

In addition to a Will, other aspects of your affairs may require attention, as your Will does not operate in respect of assets owned by entities such as family companies or trusts or superannuation entitlements.

CAUTION:

The information set out above is of a general nature only and it is essential you obtain specific advice from your solicitor regarding your individual circumstances.