croucher succession law reform update 2011
TRANSCRIPT
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Succession Law Reformin New South Wales
2011 Update
Professor Rosalind Croucher
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Wills
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Dispensing power
• Is there a document?• Does the document
embody testamentary intentions?
• Did the deceased intend the document, without more, to be the will?
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RectificationRectify to carry out intentions where• there’s a clerical error• the will does not give effect to
‘instructions’
Succession Act s 27
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• Deceased intended to divide residue into six shares – one to Justin and his wife jointly, not additional one to Justin (7th share)
• Will rectified – six shares
Estate of Davis [2010] NSWSC 989
Rectification
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Justin & Mrs Justin
Justin
E
D
C
B
A
Rectification
Justin & Mrs
Justin
E
DC
B
A
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“My home 11 Grevillea St”
Rectification
= ademption residue ????
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Instructions?• solicitor’s note – “if house sold for
retirement unit, then residue to be divided”• “name down for Anglicare unit”• deceased wanted to benefit daughter
more than son
Rectification
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• new will prepared after sale:
“all of the monies which will be refunded from RSL Lifecare for the residency agreement that I am a party to for Villa 1”
• she died before signing new will• will rectified – gift caught new form
Estate of Tait; Vesco v Bannister [2010] NSWSC 1274
Rectification
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Statutory wills
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The will is one that the incapable person:• would have made;• would be reasonably likely to have made
Succession Act s 22(b)
Statutory wills
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12
??????????????????????????
Statutory wills
nil capacity
lost capacity
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Lost capacity: consider the person’s –• relationships• history• personality• size of the estate• previous wills
Re Fenwick [2009] NSWSC 530
Statutory wills
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What if there is no will?• don’t start with a presumption against
intestacy• but there’s probably some evidence to
satisfy the court that person intended, at some stage, to make a will
• if insufficient evidence then applicant fails
Re Fenwick [2009] NSWSC 530
Statutory wills
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‘[i]t is a serious matter for the Court to appropriate to itself the will-making power of the citizen’.
Re Will of Jane [2011] NSWSC 624, [84].
Statutory wills
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Right to inspectIncludes:• anyone named in the will• beneficiaries• spouse, children or parents• next of kin• creditor
Succession Act s 54
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Family Provision
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Family Provision
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(a) the husband or wife
(b) de facto
(c) child
(d) former spouse
(e) sometime dependant
(f) close personal relationship
Succession Act s 57
Eligibility
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Carers?• s 57(f) – ‘close personal relationship?• s 3(3) – living together, providing domestic
support and personal care• s 3(4) – not satisfied if
– for fee or reward– on behalf of an organisation
Eligibility
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Adult children patterns:• the dutiful child rewarded under the will,
facing a claim by an estranged/undutiful child
• the needy child rewarded under the will facing a claim by siblings who are not needy
Family Provision
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Family Provision
• $10,000 to Lynne• 40% to Michael• residue to Michael
and three sisters (not Lynne)
Rita’s
Andrew v Andrew [2011] NSWSC 115
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Evaluating claimsKey messages:• it is not about re-writing wills• it is not about ‘fairness’ from a child’s
viewpoint• it is not about ‘equity’ between children• parents are still able to make judgments
about the worthiness of their children
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Evaluating claims• a parent is not expected to provide
forever for children• a child who is still dependent may
have a continuing claim• the community may expect a parent to
provide a ‘buffer against contingencies’ for a child who falls on hard times – depends on size of estate and competing claims
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Gut instincts
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Section 60 factors, include – • applicant’s contribution to estate or welfare
of the deceased (financial or otherwise)• deceased’s contribution to applicant• character and conduct of applicant• evidence of what testator wanted
Evaluating claims
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• What is the reason?• Needs of plaintiff, size of estate, other
claims?• Deceased is entitled to make no provision
for a child who treats their parents callously
Estrangement
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Result• Estrangement not the fault of the
deceased – and over 35 years• Good relationship continued with other
children• Testator entitled to make little provision for
child who withholds support and love without justification
• Conduct and need inter-related
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PropertyNotional estate – Part 3.3• entering a prescribed transaction• timing• deeming
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Eg – joint tenancy• = prescribed transaction – s 76(2)(b)• takes effect on death – s 77(3)• should it be deemed? – ss 78, 83
Property
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Avoidance strategy?• give cash gifts – but note pension
impact • give away movables – deed of gift but
retain possession as custodian?• > 3 years if possible• provide reasons – to explain, if
needed
Property
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Richard Pratt
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Richard Pratt
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Property
Pratt’s domicile
movablesimmovables
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Property
movablesimmovables
movablesimmovables
movablesimmovables
testator’s domicile
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Pratt’s propertyDid Pratt leave property in NSW?• no actual estate• notional estate claims over properties held
by companies – Pratt a director
Fiduciary duty
No notional estate
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Capacity• difference from prior wills?• explanations for change?• inofficious?• need to take a cautious approach
Probate
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Intestacy
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Next of kinspouse
issue
parents
siblings
grandparents
aunts and uncles
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Family tree …
Intestate BrotherSister
Mother Father Uncle
Grandfather Grandmother
Niece NephewChildren
FirstCousins
Gt-niece
First Cousinsonce removed
Gt-nephewGrandchildren
Gt Grandfather
Gt-Uncle
First Cousinsonce removed
Second Cousins
Gt Grandmother
Second Cousinsonce removed
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Per stirpes…
IntestateBrotherSister
NieceNephew
Two
Gt-niece Gt-nephew
NephewOne
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• Siblings: two shares• Sister predeceased leaving surviving issue• Sister’s share: divided into two• Niece’s s share divided between her two
children• Nephew Two gets nothing
Per stirpes…
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Per stirpes…
IntestateBrother = 50%Sister’s share = 50%
Niece’s share = 25%
NephewTwo = 0%
Gt-niece= 12.5%
Gt-nephew= 12.5%
NephewOne = 25%
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For further information on the Uniform Succession Laws
project• QLRC website –
www.qlrc.qld.gov.au • NSWLRC website –
www.lawlink.nsw.gov.au/lrc • ALRC papers and speeches –
www.alrc.gov.au