In the last edition of Off the Record, we began exploring what can be a highly contentious issue: challenging a Will.
As I outlined in Challenging a Will: Part 1, there are two main legal grounds on which someone can question a Will. The first, which we explored in Part 1, is that the Will’s legal validity is disputed.
This time, we explore the second basis for taking legal action: where a beneficiary believes that they haven’t been adequately acknowledged, and the three pieces of legislation that set out the grounds for such a challenge.
Under the Property (Relationships) Act 1976, a spouse, civil union partner, or de facto partner (usually of more than three years) can generally lay claim to up to 50 percent of the combined relationship property. To mount a successful challenge to a Will, they must prove the relationship qualifies under the Act. If it does, they have a choice between two options:
- Option A – apply to the court for a division of relationship property, or
- Option B – do nothing, and accept the terms of the Will
An application must be made to the court within six months of the date probate was granted. If no application is made, Option B is the default.
There are a couple of factors to bear in mind. Firstly, it’s quite possible a spouse will be better off taking what is left to them in the Will, depending on the individual circumstances. The deceased can leave 100 percent of their estate to their spouse, after the administration costs and debts are paid. Also, if Option A is chosen, all gifts given by the deceased under the Will are forfeited (although the court can be asked to reinstate them as part of the division).
Let’s take our fictional married couple, Colin and Diane. Colin dies. If he has left most, or all, of his estate to Diane, she doesn’t have to do anything in terms of electing Option A or B. In this situation Diane is better off taking what she receives under Colin’s Will (Option B). If she doesn’t choose one of the options, then six months after probate is granted, she will be deemed to have chosen Option B anyway.
However, if Colin’s Will gives 50 percent or more of his estate to his children from his first marriage, then Diane may very well be better off to take advice around the merits of selecting Option A.
Relationship property, especially where blended families are involved, can add another layer of complexity. Again, taking timely legal advice and keeping your Will up to date are essential – discussing your intentions with your partner or spouse can also help cut any potential problems off at the pass.
A breach of moral duty
The second piece of legislation that can potentially cover those who feel they have not been adequately provided for is the Family Protection Act 1955.
Under this Act, claimants must prove that the deceased had a moral duty to provide for them, and that they have breached that duty by not doing so adequately – or at all – in their Will. Typically, claimants are a spouse or partner, children, stepchildren or grandchildren who were in some way reliant on, or maintained by, the deceased.
A successful challenge can result in a claimant being awarded a remedy, the size and nature of which can vary substantially. Given how involved these proceedings tend to be, you will usually need to seek legal representation to pursue a court case.
A key factor to be aware of is time. A claim must be filed in the court within 12 months of the grant of administration/probate. The court can sometimes extend this, but not if the estate has already been distributed.
Interestingly, Family Protection Act claims are often made not for financial gain, but because the claimant feels inadequately acknowledged or recognised by the deceased. Making the reasons for your decisions and/or unequal gifts clear in a memorandum of wishes (or, ideally, in a conversation with your beneficiaries prior to your death) can sometimes be enough to ward off unhappiness, misunderstandings and claims.
Let’s take our fictional family, Alex and his three children – Eddie, Frank and Georgina. Alex leaves all of his estate to Georgina in his Will. Eddie and Frank each challenge the Will, as they do not believe they have been adequately provided for.
The court finds Alex transferred the family farm to Eddie prior to his death, and paid for Frank to attend the Clown Academy in the United States, while Georgina received no assistance. The court makes provision for Frank, as his education and travel costs were not comparable to what Eddie and Georgina received.
Preventing future challenges
How might you prevent challenges under the Family Protection Act?
- Making gifts of property before death – In this way, the property is no longer part of the estate.
- Trusts – Putting property into a Trust during your lifetime (but, be aware, any outstanding debt that the Trust owes you as a result remains in the estate).
- Making a contract to leave property by Will –This can then be enforced like any other contract.
- Written explanation – Leaving a written explanation of why property has been left to certain people. This will not necessarily prevent a claim, but it will help the court to make a decision.
The final legislation people can seek a remedy under is the Law Reform (Testamentary Promises) Act 1949. Under this Act, spouses, partners, ex-partners, children, stepchildren, other family members and non-family members can claim if they believe they were promised something that did not eventuate in the deceased’s Will in return for care or other services provided during the Will-maker’s lifetime.
Depending on what was promised, the circumstances of that promise, and the amount of the deceased’s estate, remedies can include either:
- The amount of remuneration specified by the deceased; or
- The real or personal property specified by the deceased
So, to be successful, what would a claimant need to prove?
- That they provided services or care to the deceased while they were alive
- That a promise was made – either expressly or impliedly – to reward the claimant
- That there was a link between the services/care and the promise
- That the deceased failed to include reference to that promise in their Will, or otherwise reward the claimant
The claim must have been filed with the court within 12 months of the grant of probate. This timeframe can be extended by the court, but only if the estate has not been distributed – so the earlier you claim, the better chance you have of success.
But what constitutes “work” or “services”? Examples include personal care, housework, financial help, assistance with properties or businesses, support and companionship. Note, though, family members will only meet the threshold if they go beyond what is reasonably expected within the relationship they had with the deceased.
Our fictional character, Indigo, suffers a debilitating stroke at 87. Her nephew, Jake, and his girlfriend, Katie, take her in, and she lives with them for five years, until her death. During that time, Katie cares for Indigo extensively, including helping her bathe and dress, feeding her, doing her laundry and dishes, and ensuring she gets to all her medical appointments and Bingo nights. Indigo is very grateful for this and promises she will take care of Katie in her Will. Having Indigo living with them put a lot of strain on Katie and Jake’s relationship, and they separate after Indigo passes. Katie brings a claim under the Testamentary Promises Act, and wins a lump sum for her care of Indigo.
Get it sorted while you can
To help ensure your Will is not challenged on these grounds, there are steps you can take in life, including:
- Make any specific gifts while you are still alive
- Don’t make promises you have no intention to honour
- Amend your Will to include any such promises
- Even if you do not change your Will, make a written note of the intended gift and provide a copy to your lawyer or executor
As you can see, simply being unhappy with the provisions of a Will is not enough – there must be some legal ground for the challenge, and different, prescribed steps will need to be taken, depending on the nature of the grievance.
Remember, too, challenging a Will can be a big step when family and other close relationships are on the line. It’s generally advisable – before even mentioning mounting a challenge – to meet with your lawyer to discuss your concerns. They can advise you on whether there are legal grounds for a challenge, the merits of your case, as well as give you a steer on the emotional and financial costs you would potentially be signing up for.