Have you made a Will? Have you ever wondered what would happen if you died without a Will?
Research indicates about 1 in 2 Australian adults do not have a valid Will. If a Will maker (the “testator”) dies without a valid Will, the testator’s estate will be dealt with according to what are known as intestacy laws. In some cases, application of the intestacy laws can lead to outcomes you would not expect or want.
A Will is a legal document which sets out how a testator’s assets are to be dealt with after the testator dies. Where a Will is valid, the testator’s estate will be distributed by a named Executor, often a loved one, according to the terms of the Will.
In New South Wales, where the testator dies without a valid Will the testator’s estate will be distributed according to Chapter 4 of the Succession Act 2006 (NSW) (‘the Act’). A breakdown of the formula applied by the Act where a spouse or partner outlives the testator is outlined below:-
|Surviving Person/s||Beneficiary and their entitlements|
|Spouse & no children||All to spouse|
|Surviving spouse & children who are also children of the spouse||All to spouse|
|Surviving spouse & children from another relationship||Spouse receives statutory legacy >$350,000.00 (this figure has been indexed since December 2005 and increases each year) plus personal effects and half of the balance of the estate|
|Multiple spouses (e.g. separated but not divorced spouse and current de facto partner)||Shared according to a distribution agreement or distribution order|
As you might anticipate, unpleasant outcomes can occur where the testator is survived by a spouse that he or she has been separated from, but no divorce or formal property settlement has been organised prior to the testator’s death. This may also result in problems where the testator had a blended family and step-children.
For example, this could mean a former spouse that you not seen or spoken to for many years will end up with a share of your estate, if not all of it.
Dying intestate will also mean that the person administering the estate may not be a loved one, but a Court appointed person or the Public Trustee, which may involve higher fees and delays in estate administration.
If you would like to make a Will or have any questions in relation to the information raised in this article, please do not hesitate to contact our Estate Planning Solicitors at Brazel Moore Lawyers on (02) 4324 7699.