heirs & successes

In 2008 Heath Ledger died of an accidental drug overdose aged 28. His last Will created in 2003 left Ledger’s estate to his sisters, his father and mother. In 2005 Ledger and Michelle Williams, had a daughter Matilda. As Ledger hadn’t created a new Will, the only way that Matilda could have inherited, except for the generosity of Ledger’s parents and siblings (who decided to give everything to Matilda) would have been by making a family provision claim.

 Whilst Ledger had created a Will the fact that he didn’t update it caused further distress to his family at a difficult time. As New Years Eve is a time to make resolutions why don’t you resolve to make a Will (or update your Will) as early as possible in the New Year.

 Many of you will ask, “Why do I need to make a Will anyway?” If you own a car, furniture, bank accounts, a property and shares making a Will allows you to direct who will be the executor of your Estate, which family members or friends will receive your possessions following your death, and if you have children who will be their guardians.

 If you die without a valid Will your Estate may be divided according to the laws of intestacy leaving it to people you may not even know.

 If you don’t have children or obvious heirs, documenting your wishes and making them accessible will help ensure those wishes are fulfilled should something happen to you. 

 Along with health care directives (often called living Wills) organ donation and arranging insurance cover for loss of income or permanent disability. It is important that you discuss your wishes with someone in order that they are able to act on your behalf in the event of an emergency

 Importantly regardless of what you wish to do with your estate be it leaving money to charity, a pet, or friends and relatives you should prepare a Will. As it is important to formulate and communicate to those closest to you a definite plan for your wishes in order that those wishes are met.

So plan for your future and have a Happy and Safe 2016!

In the last post we discussed making a family provision claim against the deceased estate – this is often referred to as contesting a Will.

Generally speaking a Family Provision Claim is made in a jurisdiction where the deceased lived at the date of their death, owned assets in that jurisdiction, or both.

In most Jurisdictions legislation governs who can bring a claim against a persons estate. Generally speaking this is: –

• The deceased’s spouse, a person living in a de facto relationship with the deceased at the time of death, a person living in a close personal relationship (such as a volunteer carer) with the deceased when the deceased died;
• The deceased’s child;
• The deceased’s former spouse;
• A person who was:
• Dependent (wholly or partly) on the deceased at a particular time (this may include a former de facto spouse, parent, sibling, or step-child; and
• A grandchild of the deceased, or a member of the household of the deceased;

and

• believe they have been left without adequate provision for the proper maintenance, education or advancement in life.

The Court takes a number of factors into account the applicant’s financial position, relationship with the deceased, the size of the estate and the deceased’s relationship with other persons who are eligible to make a claim.

Adequate provision is unique and therefore difficult to define.

The Court considers a broad range of factors, as the definition of adequate provision is unique to each circumstance brought before the court.

A recent claim concerned the Estate of Richard Pratt who died in April 2009 aged 74 as one of Australia’s wealthiest men. The following year, his former long-term mistress, (and the mother of his youngest child, Paula) Shari-lea Hitchcock claimed she was the billionaire’s “domestic partner”, and as such it was his “responsibility to make adequate provision for her proper maintenance and for her support”

It was reported that in a 2007 Will Pratt left Paula the home in which she was raised by her mother, a rural property and $23 million in shares held on trust until Paula turns 21. However Shari-Lea believed that she and her daughter had not been adequately provided for in Pratt’s Will.

Shari-lea failed as the claim was brought in NSW and Pratt had been living in Victoria when he died and did not personally hold any property in NSW. Shari-lea and the Estate agreed to a confidential settlement early this year.

 

Judith McIntyre died aged 66 in June 2014. A month before her death, she had a new Will prepared leaving $250,000 each to her adult children Sarah, 34, and Seth, 41, and the rest of her $1.1 million estate to Universal Medicine founder Serge Benhayon.

Her children brought a family provision claim in the Supreme Court seeking provision from the Deceased’s estate in the sum of $550,000 each. Even though they had assured their mother that they would not challenge her wishes.

Judith believed strongly in the teachings of Universal Medicine, and wanted to make a gift that would help establish a teaching Hall as a lasting legacy.

During her life time the deceased made payments of $800,000 to Benhayon to ensure that there is [a] building that is available to the public in Australia to reflect on the principles and guidance given to her by Benhayon that gave her so much support’.

She wished to give this money and to leave money in her Will to expedite renovations of a warehouse into a teaching hall on a property owned by Benhayon. I have discussed this with my children. They have assured me that they will not challenge my wishes.’

The warehouse required extensive renovation and fit out and a complete re-work of the existing space in order to be able to be used as a teaching hall. In cross-examination, Benhayon said that the $800,000 was used to refit and effect renovations to the building located on the property.

The Supreme Court held that Judith knew exactly what she was doing when she made her will, and weighed up the competing considerations of the need to leave a legacy to Sarah and Seth and her desire to promote the teachings of Benhayon. She told Sarah and Seth of her plan to leave a significant part of her estate to Universal Medicine, explained her decision to them and sought their assurance that they would respect her wishes.

If Judith had died intestate she would not have been able to leave money in this fashion as the laws of intestacy follow a strict pattern. Whilst her children would have obtained a greater share of her estate a person who has testamentary capacity is able to direct there estate in whatever way they wish – but in order to do this they must leave a valid Will

Statutory wills have largely been used in situations where a young person, who is estranged from one parent, has suffered a catastrophic injury resulting in a large compensation pay out.  In these cases, Courts have been satisfied that if the laws of intestacy applied it would be unjust for both parents to receive an equal share of the estate. Interestingly, as the population ages, statutory Wills will be applied to a broader range of cases.

GM aged 81 and her husband, GAU, aged 82 had been married for over 50years and had two adult children GK and GL. GK married GAV (the respondent to the appeal). She and GK have two sons .

GM made a Will on 21 June 1998 some four months after GK and the respondent married. Under that will certain gifts were made to the respondent. These gifts included a share in a private company, two properties, jewelry, furniture, and a share in the residuary estate.

GM has been in full-time care on account of her progressing Alzheimer’s disease since 2002. In 2011, she suffered a severe stroke that rendered her immobile, unable to speak and in a vegetative state. When this matter came before the Court GM’s life expectancy was a matter of months and a terminal event could occur at any time.

GAU has acted for his wife during her incapacity under an Enduring Power of Attorney.

In May 2014, the respondent and GK separated. Shortly afterwards, GAU filed an application in the Supreme Court seeking the alteration of the GM’s will that the son’s benefit be held on trust, in order that the respondent could never qualify as a beneficiary of it.

GAU argued that GM had a close relationship with GK and always intended that the money she had inherited from her parents and all her assets be passed down to the members of her family.  If GM had the required testamentary capacity the divorce from the respondent would have prompted a change in her Will.

The Court accepted a submission made by the respondent that the intention of the application  was “to… “protect” GK’s interest from the reach of property adjustment proceedings in the Family Court of Australia”.

On appeal it was found that the primary judge had prioritised the role of the dispute between the son and his wife over the interests of GK. The Court of Appeal allowed the alteration of GK’s Will as her wishes (if she had the capacity to communicate those wishes) should be given greater consideration than any other competing interest.

In November 1997, Charles, aged four months, was admitted to hospital with severe head injuries. He was in a critical condition and was placed on life support. The treating physicians were of the opinion that the injuries were deliberately inflicted and were consistent with “Shaken Baby Syndrome”.

The parents did not provide any explanation to the Police as to how Charles came to be injured. They have, however, consistently denied that they injured him. The parents have never been charged with causing Charles’ injuries. However, the surrounding circumstances raise a suspicion against them. In 1998 the Children’s Court ordered that Charles be removed from the parents’ care, and parental care was allocated to the Minister for Community Services.

In November 2000, the Victim Compensation Tribunal awarded Charles compensation to be held on trust for him by the Public Trustee until he reaches the age of eighteen years. However, Charles’ life expectancy is diminished because of his immobility and the increasing risk of lower respiratory infections.

The medical evidence shows that Charles disabilities are permanent and he will never have testamentary capacity. The Minister sought an order for a statutory Will for Charles.

If Charles were to die intestate, then due to state law his estate would go to his parents in equal shares. The Minister believes that the parents should not benefit from Charles’ intestacy and that Charles’ whole estate should go to his sister, who is some two years older than Charles. If she predeceases Charles, the Minister proposed that the estate be divided equally between two charities which care for disabled children such as Charles, namely the Sydney Children’s Hospital Foundation and the Spastic Centre.

The parents had no objection to the proposed statutory Will and did not wish to be represented during the proceedings.

The Court held that this is a nil capacity case as Charles has never had, and never will have, testamentary capacity. The Court applied as a test that there is a fairly good chance that a reasonable person, faced with such evidence as to the cause of Charles’ injuries, would decide against Charles’ estate passing to the parents on intestacy.

Similarly the Court was satisfied that not only was it reasonably likely but it is highly probable that a reasonable person faced with Charles’ circumstances would give the whole of the estate to Charles’ sister, and if she predeceased him would choose to provide in his will for a gift to the Sydney Children’s Hospital Foundation and the Spastic Centre.

 

The Supreme Court on behalf of a person who lacks testamentary capacity makes a Statutory Will. Statutory Wills may be referred to as ‘court-made wills” or “court-authorised wills’. Statutory Wills are a fairly recent development in Australia and might be needed where a person has dementia, and they lack the capacity  to update their existing will which is out of date. Similarly where a person suffers an injury in childhood, if a Statutory Will is not made, their estate will pass according to the laws of intestacy, which might not be appropriate in that particular case.

Family members commonly make Statutory Will applications, however there is nothing to stop a carer, lawyer, or financial adviser from making them. As discussed yesterday someone who stands to benefit under the proposed will is not disqualified from making the application.

The Court needs to be satisfied that ‘the proposed will … is or is reasonably likely to be, one that would have been made by the person if he or she had testamentary capacity’.

The Court must be satisfied of various matters that are set out under the relevant legislation. The applicant for a Statutory Will must supply the Court with information about the lack of testamentary capacity of the person. Details of the person’s financial position; Who would inherit the person’s Estate if they died without a Will and a copy of the proposed Will,  Codicil or both should be provided to the Court.

The Court also must be satisfied that the Applicant is an appropriate person to make the Application; and why the proposed Will, Codicil or both would be made by the person if they had capacity to do so.

 The Estate of the person for whom the application is being made will pay the costs of the application in most instances.

 

Jane was born in April 1925 and married her husband, in April 1958. They had three children. In 1962 Jane made a Will. So far as is known, the 1962 Will is Jane’s only Will.

Jane appointed her husband as sole executor and beneficiary provided he survived her for a period of one calendar month. If he did not, Jane appointed her friend, Marion, as the sole executrix. If her husband pre deceased her she left the estate to her children in equal shares.

Marion was also appointed the legal guardian of any infant child or children. Jane’s husband, and Marion predeceased Jane.

In 2006 Jane was diagnosed with dementia that required her admission to be under “strict supervision” in an Aged Care Facility. Jane had lost testamentary capacity by April 2007.

Jane’s husband died intestate on 5 July 2007.

In September 2007, the Public Guardian was appointed Jane’s guardian, with the functions of accommodation, health care, medical and dental treatment and services and remains Jane’s guardian.

The Plaintiff, sought the creation of a statutory Will for Jane; a Statutory Will is one that is made by the Court on behalf of a person who lacks testamentary capacity.

In NSW the Courts have held that if they were to alter or make a new Will s 22(b) of the Act states that

‘the proposed will, alteration or revocation is, or is reasonably likely to be, one that would have been made by the person if he or she had testamentary capacity’.

Therefore, the Court needs to be satisfied that, on the evidence available, there is a ‘fairly good chance’ that the person would have made a Will at some time had not testamentary incapacity supervened. The burden of proof falls on the party making the application for the statutory Will.

In this case the Plaintiff asked that the NSW Trustee & Guardian be executor; that the whole of the deceased’s estate is left to him, in the event that the he does not survive Jane, that her entire estate is to be left to charity.

The Plaintiff believes that Jane would be reasonably likely to make a new will in the form proposed, because his siblings had engaged in what he described as “reprehensible conduct”; had no “need” that is not of her, or his, own making; and that the Plaintiff was, and is, a dutiful son who has made significant sacrifices helping his parents.

In rejecting theses arguments the Court concluded that the Plaintiff’s entitlement under the 1962 Will is sufficient to provide him with secure accommodation.

The Court was not satisfied that, with the exception of appointing an executor, Jane’s likely intention would be to change the 1962 Will at all.

John Denver singer-songwriter, some time actor, activist and humanitarian was killed when his experimental plane, crashed into Monterey Bay, California in October 1997. His estate was worth $19 million. He died without a Will

As Denver died in California, distribution of his intestate estate was subject to California law. Denver was not married at the time of his death therefore his children inherited all community and separate property. Under Californian law songs created during a marriage are considered community property, therefore if he were married the copyright in those songs created during the marriage would go to his spouse.

Denver donated his time to a great many charitable causes. He was a board member of the National Space Institute, the Cousteau Society, and Wildlife Conservation Society (WCS). It seems strange that he wouldn’t have provided for these causes at the time of his death , however as he didn’t leave a Will then none of these causes benefited from gifts from his estate.

Denver was a noted environmentalist who had purchased property in Colorado with the intention of preserving it forever as a wildlife sanctuary and open space, however this land has now been sold,  which may not have happened if it had been left with this specific environmental purpose stipulated in a Will.

A California judge appointed Denver’s ex-wife Annie the administrator of the estate. His assets were divided between his 2 Adult children from his marriage to Annie with his 8 year old daughter Jesse Belle from his second marriage having her share placed in trust.

Although Denver did not have a Will he had established trusts worth $7 million each for his mother, father, ex-wife Annie and for each of his 3 children when they were born. Due to their acrimonious divorce he did not set up a trust for his second ex-wife Cassandra. In most cases it is much easier to create a Will than it is to establish a trust, and in Denver’s case it would have saved his family time and money.

The Californian Probate Court took 6 years to finalise Denver’s estate. The Internal Revenue Service argued the value of the estate was understated by $2.5 million, and therefore owed about $1.5 million in back taxes. Similarly the IRS believed Denver’s record label, and management company were worth about twice the value estimated by the estate. These disputes were settled with the estate receiving a $600,000 tax return some years later as the IRS had over estimated the value of the assets and the tax owed.

Many of the problems that Denver’s family had in relation to his estate could have been reduced if he had left a Will. Not only did they have to grieve for the sudden loss of a Father, Brother, and Friend, but they had to deal with the additional costs and stress of intestacy.

In March 2002 Ross Cramley (“Ross”) died in a motor vehicle accident in Western Australia aged 17. As Ross was under 18 he did not leave a will. He was unmarried, did not live in a de facto relationship, and had no children.

His parents Mary and Jeffrey were divorced and each sought orders that they make the funeral arrangements  and that Ross be buried in a cemetery in the mothers case in Perth, and the father’s case, in Sydney.

Ross’s parents separated in 1987, with his father granted custody, and his mother being granted reasonable access. Until 1998 Ross lived with Jeffrey and his fraternal Grandmother in Sydney. At the age of 14 he returned to Perth to live with Mary. In about April 2000, Ross moved out of Mary’s home and started to live in the home of one of his school friends.

In December 2000, Ross returned to Sydney to live with Jeffrey moving regularly between Sydney and Perth. In the last 16 months of his life Ross spent about 9 months in Perth and 7 months in Sydney. When he was in Sydney, he lived with his father, where he kept his belongings. When he was in Perth, Ross stayed in the home of his school friends where he also kept his belongings. At this time his father financially supported Ross.

After you die your executors have a right to the custody and possession of the body (although they have no property in it) until it is properly buried.

Courts have confirmed that the following sequence can be used to decide who has carriage of the body and burial rights:

 “Where no executor is named the person with the highest rank (right) to take out administration will have the same position (privilege) as the executor…

 Where two or more persons have an equally ranking privilege, the practicalities of burial without unreasonable delay will decide the issue.”

As Ross left property in both Western Australia, and New South Wales, both of the parties have a right to apply for, and would be likely to be granted, letters of administration.

Mary submitted that says that she was not well off financially and would not be able to meet the cost of attending a funeral in Sydney or of making trips to Sydney to visit the grave. Jeffrey said that he would be prepared to pay the airfare for Mary and her mother to attend a funeral in Sydney, and pay an airfare for Mary to visit Ross’ grave each year.

Both parents expressed the wish to visit Ross’ grave on a regular basis in the future, and both have sizeable family living in both cities who would wish to attend the funeral.

The Court decided that looking at the issue in a

“practical way paying due regard to the need to have a dead body disposed of without unreasonable delay but with proper respect and decency”

Ross died in Western Australia,  Jeffrey was presently in Perth for the Court hearing and has family here; is financially better off  therefore is much better placed than Mary to travel to visit Ross’s grave. Based on those factors, slight as they were, the Court decided in favour of a funeral in Western Australia.

In research undertaken in conjunction with various stakeholders including the NSW Public Trustee it has been found that the Aboriginal community commonly has disputes regarding the burial of relatives. These disputes are very disturbing for those involved and lead to ill feeling among families and long standing ruptures in community relationships. This problem tends to arise where the deceased has not made a Will and dies intestate.

Importantly the advantage of making a Will and appointing an executor is that the executor has the right of disposal of the body. It should be noted that apart from a direction not to cremate a body, a direction in a Will to deal with a body a certain way is not binding; however the Will maker can appoint an executor who is willing to carry out their wishes in relation to funeral rights & burial.

If the person dies intestate it is up to the court to decide who has the duty to arrange the burial. If the intestate estate is very small there might not be an application for letters of administration and it may require expensive Court action to determine who has the right to decide how to dispose of the body.

It has been long held by the common law that there is no property in a dead body. The leading Australian case concerned the ownership of the preserved body of a two-headed baby. The High Court of Australia did not definitively answer whether there could be property in a dead body however this particular baby could be regarded as property because it had been preserved with care and skill.

Therefore if a body is embalmed with care and skill it belongs to the embalmer, or to the person who paid the embalmer. This reasoning has been applied to cases involving the theft of preserved body parts from the Royal College of Surgeons where the Court found they were the property of the College.

In 2007 the Tasmanian Aboriginal Centre brought an application for letters of administration to the Supreme Court of Tasmania in relation to 17 Tasmanian Aboriginals who died more than 150 years ago and whose remains were held in the Natural History Museum in the United Kingdom. This case was unusual for several reasons including that there was no evidence that any of the 17 deceased persons held any property, or that there is any estate remaining and the personal representatives of the 17 deceased persons are unknown.

The application was brought because the Natural History Museum made it clear that it proposed to conduct DNA investigations on the remains, take tissue samples and otherwise investigate the remains before they were returned to Tasmania for burial.

The Court granted letters of Administration so that the remains could have “legal protection from unnecessary disturbance and violation” and be returned to Tasmania for burial in accordance with Aboriginal customary rights.