Francis and Associates Lawyers - Local Pilbara Lawyers

Estate Administration and Common Misconceptions

Should you die with a valid Will, and your estate be of a certain value, your Executor will need to apply for a grant of probate. As noted earlier, this is quite a technical matter and I would always recommend that your Executor use a lawyer to save them a lot of time and headaches. It also ensures the application for a grant is correct. The purpose of applying for a grant is to prove the Will. Proving a Will mean that the Supreme Court verifies its validity, the size of the estate and the executor’s investigation. This all needs to be completed before the Court provides a grant of Probate. A grant of probate is required before funds exceeding a certain amount can be released from a bank, properties can be sold or transferred, a tax file number can be created and so on. When all assets have been called into the Estate, the Estate can be distributed in accordance with the Will.

Should you pass away without leaving a Will, known as intestate, your administrator, depending on the size of your Estate, will need to apply for a grant of letters of administration. As with a grant of probate, this is a technical application and requires the Court to ensure the administrator has made the necessary enquiries. This can be an involved and expensive process depending on the family circumstances and Estate assets. As mentioned earlier, the Administration Act has a formula for distribution depending on certain factors:

Some examples

 

Spouse or de facto partner(s) and children 

 

Estate less then $50K- 

All to spouse 

Estate more then $50K–  First $50k to spouse then balance divided 1/3 to spouse and 2/3 to kids equally 

No spouse or de facto partner, but leaves issue 

 

Whole of estate to kids equally 
Parent or parents, no spouse or de facto partner, no issue and no sibling or child of a sibling 

 

Whole of estate to parent/s in equal shares 
Spouse or de facto partner(s), no issue and no parent, sibling, or child of a sibling 

 

Whole estate to spouse 
No spouse or de facto partner(s), no issue, no parent but the deceased leaves sibling or child of a sibling 

 

Siblings and deceased siblings children entitled to whole of estate in equal shares 

COMMON MISCONCEPTION

  • ‘If I give one of my children that I don’t get along with any more $50, the cant contest my Will’.  I hear this a lot and this is certainly not true.  In a scenario where you should be providing for your children, unless you provide similar amounts, your will can be challenged.  Giving $200K to two children and $100 to another can result in this, and I expect the Will would be challenged.  This isn’t to say you should provide for someone who you have firm reasons not to, however this needs to be discussed with a solicitor and strategies put in place to prevent a claim where possible.  It is always important to mention in this statement that a claim against your Will is paid for out of your estate.  The two key negatives with this is 1) there isn’t the usual disincentive of legal costs in bring an action and 2) if your Estate is small, such action can use up all of your estate so the only one receiving any benefit is the lawyers.
  • ‘I don’t need a Will as my wife will get it all anyway’.  This also isn’t true.  If you do not have a valid Will when you pass away, your Will is distributed in accordance with the Administration Act which provides a set formula for its distribution.  In the event you have children, you wife will only receive the first $50,000 plus 1/3 of the balance, with the remaining two thirds being equally divided between your children.  So, for example, an Estate of $500,000, your wife would receive only $200,000 with your children receiving the remaining $300,000 equally.  Whilst its nice for your children to be provided for, this could significantly impact your wife should she survive you for a long period of time. 
  • Ill be dead so everyone can fight about it when I’m gone’- Whilst I guess there is some logic to this statement, the only thing to be mindful of is, as noted above, if everyone fights about it, everyone might miss out and you may not end up providing for the people you had planned to. 

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