Disclaimer of Gifts or Entitlements
Beneficiaries are not obligated to accept a gift under a will or an entitlement arising from intestacy. A beneficiary may disclaim a gift or entitlement, which can be made verbally, in writing, or through conduct.
Jemal David Zagami (as administrator of the deceased’s estate) v James [2017] WASC 292
Jean Hilda Jessie Sharp died intestate on 4 September 2011. She had three children, two of whom survived her. The administrator of the deceased’s estate commenced proceedings with the surviving children (first and second defendants).
The administrator’s solicitor attempted to contact the second defendant concerning the estate several times but was unsuccessful. When the second defendant was called, he informed the solicitor,
“I do not want anything to do with the legal… I don’t want anything to do with it.”
The Court ruled that a beneficiary can renounce their statutory entitlement when expressed through an absolute, immediate, and unconditional refusal communicated (even if just verbally).
The second defendant did not have any children. Therefore, following his renunciation, the first defendant is the only individual with an interest in the deceased’s estate. Because of the renunciation, the entirety of the estate can now be distributed to the first defendant, the only other member of the class entitled to the distribution.
Critical principles for disclaiming an interest in an estate, as derived from Jemal David Zagami (as administrator of the deceased’s estate) v James [2017] WASC 292 (per Allanson J), are:
- Definition: A disclaimer is a refusal to accept an interest.
- Communication: This must be communicated to the executor or administrator; no formal method is required.
- Validity: A disclaimer must be definitive, occur before distribution, be unequivocal and irrevocable, and cannot be withdrawn.
- Effect: For intestate estates, a disclaimed share passes as though the disclaiming beneficiary never existed.
Section 14 of the Administration Act 1908(WA):
Provides equal division of an intestate estate among siblings and children of deceased siblings if no surviving parents, spouse, de facto partner, or children exist.
Half-blood relationships are treated equally to full-blood relationships under section 12B.
Section 66 of the Trustees Act 1962(WA);
Addresses uncertainty regarding beneficiaries’ existence, location, or status.
Enables trustees to advertise for claims and seek court directions for distribution.
Allows for a Benjamin Order under section 66(5), protecting trustees from liability for incorrect distributions while not extinguishing resurfacing beneficiaries’ rights.
Section 45 of the Administration Act 1908 (WA);
Grants the Court broad authority to resolve questions concerning a will, estate administration, or asset distribution.
Applicable to disclaimers of interest and other estate matters.
Background
The deceased, Barry Robert Bullen, passed away intestate on 13 May 2021, leaving no surviving parents, spouse, de facto partner, or children. Gerald Peter Bullen (brother) and Phillip Leslie Wyatt (solicitor) were appointed administrators of the estate (“the Estate”).
The Estate, valued at $113,249.60 as of 19 June 2024, remains undistributed due to the unknown whereabouts of Linda and Paul Bullen (stepsiblings) and communication challenges with Tina Bullen (stepsister).
Efforts to Locate Beneficiaries
Extensive inquiries were made to locate Linda and Paul, including engaging local agents and publishing advertisements in The West Australian and the Government Gazette. No claims were received, and their whereabouts remain unknown.
London resident Tina Bullen was contacted by Seymour Legal but expressed suspicion about the legitimacy of the communications and refused to engage further. Her last communication, on 26 August 2021, explicitly declined involvement.
Despite substantial efforts by the administrators and their legal representatives, attempts to reassure Tina and verify her identity were unsuccessful.
Court Application
In Gerald Pegrr Bullen and Phillip Leslie Wyatt as administrators of the estate of Barry Robert Bullen -v- Bullen [2024] WASC 445 the administrators sought orders under s 66 of the Trustees Act 1962 and s45 of the Administration Act 1908. Initially, they sought a declaration that Tina disclaimed her share but later requested directions to hold her share in trust and fund further efforts to contact her.
Court Findings and Orders
Linda and Paul Bullen:
The administrators conducted reasonable inquiries to locate Linda and Paul. Given the estate’s modest value, further efforts would not yield better results.
A Benjamin Order was granted under s 66(5) of the Trustees Act 1962 to distribute the Estate as if Linda and Paul predeceased the deceased.
Tina Bullen:
The court declined to declare that Tina disclaimed her share, citing insufficient evidence of her intent and mental health considerations.
Share held in trust, with funds available to cover costs incurred in contacting her and facilitating distribution.
Liberty to apply for further orders, including renewing the disclaimer application, if necessary.
General Orders:
The Estate will be distributed equally among known beneficiaries (Gerald and Jane), excluding Linda and Paul.
Costs incurred for this application will be paid from the Estate on a solicitor-client basis.
This case underscores the principles governing disclaimers and the application of statutory provisions to resolve uncertainties in estate administration. The orders provide a framework to ensure equitable distribution while addressing the practical challenges of engaging missing or unresponsive beneficiaries.