How to Stop Someone Contesting a Will in NSW
Most people assume that if they make a legal and valid will it can’t be contested by family members or other interested parties.
However, this is not the case, with the issue of how to stop someone contesting a will in NSW being a complex one to understand.
The simple answer is that you can’t ever stop someone contesting your will.
This is because state and territory legislation across Australia allows ‘eligible’ people to make a claim against an estate if they can establish that they have not been adequately provided for in the deceased’s will.
While laws vary from state to state and each case will be evaluated on its own merit, there are three essential criteria that each claimant must meet:
- They must be an eligible applicant under the law
- They must have financial need
- They must be able to prove that the deceased should have made provision for them in their estate.
List of steps to stop someone contesting a will in NSW
While eliminating the chance of someone contesting your will is not possible, you can take steps to diminish the likelihood of such a dispute arising.
Get Proper Advice When Drafting Your Will
It is crucial when drafting your will that you understand firstly, how to ensure your will is legal and valid and secondly, who may reasonably have a claim against your estate after you die.
Although employing a solicitor to draft your will is slightly more expensive than using a DIY kit, or attempting to write it yourself, in the end, it could potentially save your estate hundreds of thousands of dollars.
Getting proper legal advice means that your will should be considered legal and valid at the time of your death.
This is important because if your will is deemed to be not legally binding, it becomes exposed to a higher likelihood of claims.
A qualified wills and estate lawyer should also be able to assist you in drafting a will that is set out in such a way as to minimise the risks of a claim.
For example, one of the most effective and often overlooked strategies to employ when attempting to stop someone contesting your will is to make adequate provision for any people you believe may make a claim against your estate after your death.
While you may not see this as ideal, providing for them in this way will make them think twice about contesting your will and likely prevent such a claim being made.
Structure Your Assets
There are various ways you can structure your assets during life to protect them being contested during death.
For example, if you own a property, or have a mortgage that is the name of yourself and another person, the property will pass to them upon your death without there having to be any reference to your will or estate.
While this can be a very effective method of ensuring your property passes to who you intend it to in most states and territories, in NSW, the concept of notional estate makes this more contentious.
When a family provision claim is made in NSW, the Succession Act contains notional estate provisions. These notional estate provisions allow the ‘clawing back’ of assets to the deceased’s estate for the purpose of a family provision order.
This can mean, that in NSW, even if your property was co-owned upon your death, it can be deemed to be seen as part of your estate upon death.
In this way, contests to a will can be more difficult to prevent than in other states.
However, there are timeframes related to these property transactions, with the following laws governing what can be deemed as notional estate in NSW:
- Any transaction that took effect within three years of the deceased’s death and was entered into to deny or limit provision to an eligible applicant.
- Any transaction that took effect within one year of the deceased’s death at a time when the deceased had an obligation to provide adequately for the claimant. This obligation must be ruled to be substantially more significant than the obligation of the deceased to enter into the applicable property transaction.
- Any transaction that took effect after the deceased’s death. Sale of the property by the co-owner for example.
Transfer Your Assets Before Death
Transferring your assets into your preferred heirs’ names before your death is another strategy to stop a claim being made against your estate.
However, this can be a risky strategy for the following reasons.
Firstly, as the transfer of your assets may be regarded as gifts by Centrelink and the Australian Tax Office, you may lose your rights to a pension or be hit with a large capital gains tax bill.
Secondly, in NSW, if the transfer of these assets occurs within certain timeframes, they may again be subject to the concept of notional estate and a claimant may be able to have these transactions set aside.
When considering any of these strategies above, you should always get professional advice from an accountant and lawyer experienced in the relevant laws in your state.
Do Parents Have Obligations to Adult Children?
While most people would agree that a will-maker should provide for their surviving spouse and dependent children, opinions seem to be divided as to whether there should be provision for adult children.
For some, the irrevocable bond between parent and child seems to dictate that a parent should provide for the child after death, while others believe that adult children should make their own way in the world without expecting an inheritance.
Disinheriting a Child
While most people can’t imagine wanting to disinherit a child in their will, there are cases where people feel this is the best course of action for them to take.
Strategies for minimising the likelihood that a child or other interested person may contest your will include:
Making adequate provision for anyone likely to have a claim in the estate. While this may seem counter-intuitive, adult children, particularly those who have been financially dependent upon you or are in a weak financial position, may be deemed to have a claim to your estate, regardless of who you have listed as beneficiaries.
Cases of Estrangement
Cases, where adult children make a claim on the estate of a parent from who they have been estranged, can be particularly challenging for a court to rule on.
The assessment of the court will be made based on several relevant points, such as:
The nature of the estrangement and the underlying reason for it
The financial needs of a plaintiff, the size and nature of the estate and the existence or absence of other claims
How the claimant treated the deceased before death. The deceased is not bound to provide for a child, particularly one ‘who treats their parents callously, by withholding, without proper justification, their support and love from them in their declining years. Even more so where that callousness is compounded by hostility’.
In cases of a family provision claim where there has been estrangement, the court will look at:
- If and how the applicant contributed to the estate or welfare of the deceased; and
- The character and conduct of the applicant before and after the deceased’s death
In the case of Hampson v Hampson how these elements are assessed was summarised by Hallen AsJ:
‘The requirement to have regard to the totality of the relationship can in many cases, be satisfied by considering the overall quality of the relationship assessed in an overall and fairly broad-brush way, not minutely. Consideration of the details of the relationship is ordinarily not called for except where there is an unusual factor that bears on the quality of the relationship, such as hostility, estrangement, conduct on the part of the applicant that is hurtful to the deceased or of which the deceased seriously disapproves, or conduct on the part of the applicant that is significantly beneficial to the deceased and significantly detrimental to the applicant, such as when a daughter gives up her prospects of a career to care for an aging parent. Neither entitlement to an award, nor its quantum, accrues good deed by good deed. Indeed, it is a worrying feature of many Family Provision Act cases that the evidence goes into minutiae that are bitterly fought over, often at a cost that the parties cannot afford, and are ultimately of little or no help to the judge.’
Where there a Will, There’s a Way… to Court
Recent statistics show that since 2005, the number of will disputes reaching the Supreme Court in NSW has gone up 60%, with increasingly blended families, entitled grandchildren and growing estate values all paving the way to court.
In a recent Law Society of NSW seminar, wills and estates spokesman Darryl Browne echoed this sentiment, stating that
‘There has been an enormous increase in the size of estates over the past 10 years. (While) it was rare to have an estate of more than $1 million 10 years ago, [} now it’s common due to the value of property and superannuation. People save unwittingly sometimes. There’s more in the kitty, so there is more reason for people to pursue claims if they feel they have been slighted.”
Unfortunately, such cases can result in families being torn apart by the proceedings.
When matters fail to settle in mediation and progress to court, the damage to relationships between family members can be irrevocable
with the recent case of Jagoe v Maguire seeing one beneficiary ‘suffering mental illness attributed to inter-family conflict and the siblings arguing’.
Such a case of a family being ripped asunder was also seen recently when 46-year-old Robert Wilcox made a $1.1 million claim on his grandfather’s $5.5 million rural estates, which had been left to solely to the deceased’s daughter, his mother.
Case Study – Wilcox and Wilcox
In the case of Wilcox and Wilcox a mother, Patricia Anne Wilcox, and son, Robert Wilcox, had a long-running legal battle in regards to a pastoral holding in Walgett in western NSW.
The pastoral holding was the property of Patricia’s father and Robert’s grandfather. In his will, the testator left his estate, including the land, entirely to his daughter.
Robert believed that he was entitled to his grandfather’s estate, including the ownership and related operatorship of the property, even though he had not visited the farm in the 10 years before his grandfather’s death.
This, despite his grandfather paying for him to attend the prestigious private school King’s College and attend an expensive agricultural school.
The judge overseeing the case, Justice Pembroke, was unusually scathing in his evaluation of Mr. Wilcox when delivering his verdict.
Pembroke characterised him as having a ‘highly developed and unhealthy sense of entitlement’.
He stated that despite the opportunities afforded to him by his grandfather, Wilcox had done little in the way of bettering his life due to his certainty that he would one day inherit his grandpa’s fortune.
At the time of the court case, Wilcox was living in shared accommodation and surviving on unemployment benefits.
Despite his harsh assessment of Mr. Wilcox, Judge Pembroke did award Wilcox with some money, albeit a small percentage of the overall estate.
The final ruling awarded Wilcox $107,000 to pay off a debt to the tax office and $40, 000 a year to get back on his feet financially.