COMMON SITUATIONS AND ISSUES

 

INTESTACY

 

THE WILL THE GOVERNMENT GIVES YOU

It has been said there are only two certainties in life, taxes and death.

Accordingly, the preparation of a proper Will is a matter which every person should give consideration to at least once in his or her lifetime but preferably at regular intervals throughout their life.

A 2008 survey by the Public Trustee (a Government Department) found that 54% of people in NSW did not have a Will.

If you die without a proper Will in NSW the Government will provide you with a Will as an intestate. While the Will imposed by law takes into account the way a person may normally wish their assets to be distributed, this may not always be true, and the application of the law in some instances may have unintended results.

Where there is no valid Will, the legal personal representative of the deceased is an administrator appointed by the court. Generally that person is the major beneficiary or a beneficiary who has the consent of the other beneficiaries.

The intent of the law is to produce the same results as would have been achieved had the deceased had the foresight, the opportunity, the inclination or the ability to produce a proper Will.

Generally the law operates to distribute the property of the deceased to the nearest living relation while balancing the competing needs of the surviving spouse or partner and the children of the intestate.

The law also sets out a specific order of possible relations and the priority of each class of potential relatives. It is like tracing a family tree; however when you reach a branch of the family which has at least one living person, the search then ends and the estate is distributed amongst all persons then living, who are on the family tree up to that point.

The general order of priority begins with those persons with whom the intestate was most closely related – starting with the intestate’s spouse and descendants, then parents, brothers and sisters, nephews and nieces, grandparents, aunts and uncles and finally cousins.

However problems may arise where relatives who appear biologically closer to the intestate may be further away from the intestate’s favour than those biologically distant. Close family members may not get on. A spouse may be estranged. The proposed distribution may cause hardship.

The law dealing with intestacy is complex and can be avoided by making a proper Will.

Specifically do not rely on a home- made Will. The estates of the artist Brett Whitely and racing driver Peter Brock are prime examples where litigation cost the estates very much more than it would have cost them to have a lawyer draft a proper Will in the first place.

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