ByLawyers News and Updates

Wills – Avoiding family provision claims

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Clients often require advice on avoiding family provision claims, when considering their estate planning.  New commentary has been added to the By Lawyers Wills Guides concerning the issues that should be considered when drafting a will in circumstances where a family provision claim against the estate of the testator appears possible.

This new commentary considers two common issues raised by testators when giving instructions for wills:

  1. How to leave their estate to their partner and prevent children or step children from making a claim on the estate; and
  2. How to leave the estate to their partner, whilst ensuring their children by a prior relationship are benefited on the death of that partner.

The commentary discusses some general principles from the cases and provides a range of likely outcomes for a number of classes of claimants under family provision legislation, which will assist practitioners when they are advising clients who are deciding how to distribute their estates to best avoid a potential claim.

In essence, while there is no absolute way of avoiding a family provision claim by an eligible person against a testator’s estate, appropriate consideration when preparing a client’s will can minimise the prospects or quantum of any claim, or at least ensure the testator has a clear understanding of the issues.

NSW – Estates – Can a beneficiary be evicted?

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In the recent case of Kennedy v Kennedy [2018] NSWSC 1087 Davies J struck out a defence and granted liberty for the executors to obtain default judgement and issue a writ of possession where one of five adult beneficiaries had been residing in the deceased’s house for about two years since the date of death, despite being requested by the executors to vacate. His Honour observed that:

[7] In my opinion the defences filed by the defendant do not disclose any defence to the claim by the executors. Where there is no lease in place, except if a claim was made in the nature of some form of constructive trust, it is doubtful if there could be any defence to the right of the executors to get in all of the estate property including by obtaining possession of the land.

It is the duty of the executor or administrator to get in the estate. If necessary the executor or administrator can apply to the court for a declaration and/or a writ of possession.

This applies where a beneficiary is in occupation of real property owned by the estate without permission and refuses to vacate.

This case has been added to the Estates chapter of By Lawyers 101 Succession Answers (NSW).

Wills and powers of attorney – Costing & Storage

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Costing wills and powers can be difficult. It is often not clear at the outset the extent of work which will be required. While many wills are ‘simple’, the complexity of a client’s financial position or their family arrangements can mean hours of time spent taking and confirming instructions and sometimes reviewing documents such as their self managed superannuation fund deed, or a family trust deed. The intended uses for a power of attorney are many and varied and may involve detailed advice. Any issues of capacity may also add significant time and expense.

Is a flat fee for a ‘simple’ will or a ‘standard’ power appropriate, or should an hourly rate apply?

Are there any scale costs that can be used as a guide? What costs disclosures must be made to the client?

What arrangements should be made for the storage of original wills?

How should copies of documents be managed?

These practical questions are dealt with in new sections of commentary on Costs and Storage in our NSW, Vic, Qld, SA, ACT, Tas and WA wills and powers publications.

All of these publications include the By Lawyers wills and powers Costs Agreements and example invoices, which meet costs disclosure requirements and include disbursements, billing and payment arrangements, client rights notice and solicitor’s lien provisions, among others.

ACT – Estates – New commentary

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Our ACT Estates publications have been enhanced to include new bespoke precedents – Costs agreement – Probate and Costs agreement – Letters of Administration, which can be found in folder A. Getting the matter underway in each of the respective publications.

These estate specific costs agreements are customised to suit an estate matter:

  • listing the work typically carried out;
  • listing fees and expenses typically incurred;
  • detailing for handy reference in a schedule the Supreme Court filing fees;
  • also providing in a schedule the solicitor administration costs that may be applicable.

With so much less work required these custom costs agreements will save you time on every estates matter.

The commentary in both Probate and Letters of Administration on distribution of the estate has also been enhanced to include a new section When can an executor safely distribute? covering the procedural requirements in the ACT to ensure the executor or administrator is protected.

NSW – Family provision – Interim orders

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Prompted by a recent Supreme Court case, we have added a new section called Interim provision to our 101 Succession Answers Reference Guide, which is included in all of the By Lawyers succession related publications for NSW –  Estates; Wills, Powers of Attorney, Appointment of Enduring Guardian & Advance Care Planning and Family Provision Claims.

Pursuant to s 62 Succession Act 2006 it is possible for a plaintiff who seeks provision from an estate as an eligible person under Chapter 3 to make an application for interim provision,
before – in fact while awaiting – the final hearing. Success in such applications is however very rare.

Before it can make an order for interim provision, the court must be ‘of the opinion that no less provision than that proposed in the interim order would be made in favour of the eligible person concerned in the final order’. The cases suggest this is a very high bar indeed, even for a plaintiff with dire financial need.

We invite you to explore the Family Provision section of 101 Succession Answers to find out more on this interesting topic.

TAS – Estates – Guidance Note – Itemised bills and beneficiaries

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In July 2018 the Legal Profession Board of Tasmania identified an issue with an increasing number of complaints against legal practitioners relating to perceived overcharging and failure to communicate with executors/administrators and beneficiaries regarding costs for estate matters.

As a result, the Legal Profession Board issued a detailed Guidance Note for the profession outlining what it considers to be appropriate standards of conduct, aimed at minimising complaints.

The Guidance Note says that, while there is no legislative requirement to provide beneficiaries with itemised bills, it ‘may be advisable’ to do so. This particularly applies where practitioners are also the executor or administrator of the estate and especially if they are seeking commission or proposing to charge in any way not provided for in the will.

The By Lawyers Probate and Letters of Administration commentaries have been updated accordingly.

WA Estates – Subscriber feedback prompts enhanced precedents and commentary

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At By Lawyers we love hearing from our subscribers about content that might improve our publications. A recent subscriber query brought to our attention that, while our WA Estates publication included precedents for notice and consent forms where an application is not made by all executors for probate, it is also sometimes necessary to have the equivalent for letters of administration.

This query prompted a review of the WA Estates Guide by our editorial team, after which By Lawyers have now published the following new or enhanced precedents:

  • Notice and consent forms for persons entitled to apply for Letters of Administration;
  • Consent form where there is no guarantee;
  • Letters to accompany such forms;
  • Letter to beneficiary re executor’s claim for commission;
  • Motion to dispense with the requirement for guarantees;
  • Motion for revocation of grant of probate or administration.

We have also enhanced our WA Estates commentaries with new content including:

  • Who is a beneficiary?
  • Solicitors dealing with beneficiaries when acting for the estate;
  • Challenge to the will by a beneficiary;
  • Vesting of a beneficiary’s interest in an estate;
  • Right to a copy of a will and inventory of assets.

By Lawyers always endeavour to be responsive to our subscribers’ needs. We hope that these improvements will assist not only the firm which prompted them, but all users of our WA Estates Guide.

Courts and tribunals – 1 July fee increases and legislation updates

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1 July always sees legislative changes, including increases to court fees. Happy New (financial) Year!

The following are some of the important changes commencing 1 July 2018. By Lawyers publications in each state have been updated as appropriate.

LITIGATION, CRIMINAL LAW, FAMILY LAW & DECEASED ESTATES

All States

Fee increases apply in all courts and tribunals.

Injury claims – where damages for permanent impairment and/or non-economic loss are subject to statutory caps (e.g. motor accidents and workers compensation legislation) these maximum amounts have been updated.

Defamation – the maximum amount of damages for non-economic loss available under the Uniform Defamation Law is now $398,500.

VIC Supreme Court

All documents for Supreme Court Common Law, Commercial Court and Costs Court matters must now be electronically filed using the RedCrest electronic filing platform. Court users will need to register. See the Supreme Court page ‘Electronic filing and case management’ and the commentary in the By Lawyers Victorian Supreme Court Guide

 

Wills – Special disability trusts

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A special disability trust can be established to specifically provide for the care and accommodation of a family member with a severe disability. If compliant with the statutory requirements it will allow the disabled beneficiary of the trust to retain their full pension entitlement. There are also generous concessions for contributions to a compliant special disability trust.

Along with the recent addition of special disability trusts to By Lawyers Companies, Trusts and Partnerships guide, our Wills guide now also includes detailed commentary and precedents covering special disability trusts.

A special disability trust can either be established in the will, or a direction can be given in the will for the executor to establish a special disability trust from the estate as required. Which option is chosen will depend on the client’s wishes and family circumstances. The Library of discretionary trust and special disability trust clauses in the By Lawyers Wills matter plan contains appropriate clauses for insertion in the will.

It also includes the By Lawyers Special Disability Trust Deed, which fully complies with the legislative requirements.

The new commentary covers everything a practitioner needs to know about establishing a special disability trust for their clients, including:

  • beneficiary eligibility requirements;
  • contribution and concession guidelines;
  • the permitted use of special disability trust funds; and
  • three ways the testator can provide for a disabled beneficiary via a special disability trust:
    • establish the trust inter vivos by deed and provide in the will for a bequest to the trust;
    • establish the special disability trust in the will; or
    • direct the executor of the will to establish the special disability trust, either with or without separate testamentary discretionary trusts.

 

Wills – Additional clause – direction to executor regarding disposal of body

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All By Lawyers wills precedents have been updated to include a clause that directs the executor on the testator’s wishes for their remains. This clause is automated  for LEAP users.

Where the instructions are more detailed, the Burial, Cremation, Medical Research Provisions clauses from the Library of Clauses, Deeds, Contracts and Codicils are also available.

Our Retainer Instructions already include a section for burial, cremation and medical research, so that the testator’s wishes can be discussed and recorded.

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