Have You Been Left Out of a Will?
How to Make a Claim - Family Provision Claims & Will Disputes
A family provision claim is an application to the NSW Supreme Court for a share, or larger share from the estate of a deceased person.
Inheritance disputes arise when individuals feel unfairly done by, following a reading of the deceased person’s Will.
A family provision claim can be made if:
- You are an ‘eligible’ person;
- Have been left out of a Will; or
- Did not receive what you thought was your fair entitlement.
Who is an eligible person?
For the purposes of legislation, eligibility includes the following:
- The surviving husband or wife of the deceased person;
- A person who was living in a de facto relationship with the deceased person;
- A child of a deceased person, including an adopted child;
- A former divorced husband or wife of the deceased;
- A person who was having a personal relationship with the deceased person;
- A person who was wholly or partly dependent on the deceased person;
- A member of the household of the deceased person.
A Will can be challenged if you believe that:
- The Will was not the last Will and Testament of the deceased;
- The deceased person did not have sufficient capacity at the time the Will was signed. This claim would require psychological evidence that the deceased person was not in their ‘right mind’ at the time of making the Will;
- The Will was a forgery or that it was executed under undue influence; or
- The Will was not correctly executed in accordance with the relevant Succession Act.
The Succession Amendment (Family Provision Act) 2008 came into effect and it also repealed the Family Provision Act 1982. The Act was designed to ensure that an adequate provision is made to family members of a deceased person and certain other eligible persons from the deceased’s estate.
The Process to dispute a Will:
The process varies between States and Territory. It is a lengthy procedure and can take up to 2 years.
Lodging a family provision claim makes you the Applicant in the Court hearing. Once your case is submitted, the other party opposing your case is the Defendant and the matter will be listed. You will file a Statement of Claim which outlines your reasons why you believe you should receive a share of the deceased person’s estate.
There are two stages to a family provision claim:
1. The lodgement of a claim alleging that you have been unfairly dealt with;
2. If the Court agrees with your claim, the Court will act as the testator on behalf of the deceased Estate.
Prior to lodging a family provision claim, consideration should be given to whether the existing Will accurately reflected the wishes of the deceased and whether challenging the Will would raise any ethical concerns.
Do Time Limits apply?
You have 12 months from the date of death to make a claim upon a deceased estate.
In the ACT, you have 6 months, within the date of the Grant of Probate.
In NSW, under the terms of the Succession Amendment (Family Provision Act) 2008, there is no requirement to obtain a Grant of Probate or Letters of Administration before filing a claim.
Can a family provision claim be made if the deceased dies without a Will (Intestate)?
Yes, a family provision claim can be made.
There is an emphasis on the spouse of the deceased person and legislation also considers multiple spouses (former spouses). There is no distinguishment between siblings who are full descendants or step-children. Eligibility is also afforded to first cousins.
The procedure if an Offer of Settlement is made:
Once the family provisions claim is filed, a counter-offer may be received from the other parties. This should be considered if it satisfies fairness requirements. It should also be considered if the offer is rejected, it would be prolonging an expensive and ultimately, unwinnable case. Also, since the Applicant initiated the claim, costs can be awarded against the Applicant.
If the matter is a complex one, costs can run as high as $50,000. Estate matters attract daily Court fees.
If the family provision claim succeeds, the costs of the proceedings are often paid out of the deceased Estate. However, the Court has discretion to order costs to claimants.
Are there tax implications if the claim is successful?
Tax on a potential inheritance can be significant as they can be considered a Trust, for taxation purposes. Tax is assessed at the individual marginal tax rates, excluding the Medicare levy. These tax rates can also remain in place for 3 years if the matter has not been successfully administered and finalised.
It is a good idea to consult a financial estate planner for guidance.
Tax legislation applies to any monies received from a Will and the Executor of the Will is required to lodge a final tax return on behalf of the deceased.
What are the prospects of success in contesting a Will?
About 50% of Wills are contested usually by family members. Of these, some 75% are successful claims.
Should you have any questions in regard to a Will or wish to create one, please contact us and we would be happy to assist you!