A Will is a significant legal document for both Estate and End of Life Planning. Many people who own assets would have executed a testamentary document (a Will).
The Will sets out instructions for how assets/possessions are to be distributed and to whom they are to be distributed after death.
Can your legal Will be changed after your death?
Yes, most people incorrectly believe their last Will and Testament will be implemented as they had specified. However, this certainly may not be the case.
Any oversights that are contained in a Will do not become apparent until after death, and then it’s too late to fix. It will be loved ones who will have the stress and cost of dealing with the mistakes.
REASONS WHY A LEGAL WILL COULD BE CHANGED AFTER DEATH
There are various reasons why a Will can be changed after death. Below are the most common reasons why this may occur:
- The Will could be outdated and not representative of the current family situation that existed at the time of death. The legislation specifies categories of people who are “eligible persons” to bring a claim against the estate under a States Family Provision claim. Eligible persons include a wife/husband, former wife/husband or de-facto partner, a child or any other person who was wholly or partly dependent upon you at the time of death.
- Some people may have been left out of the Will or believe they should have received a bigger share of the assets may bring a claim against the estate (Will). Each Australian State has it’s own specific but similar legislation dealing with this issue.
- The most current Will may not have included any mention of several assets that would form part of the estate.
- The beneficiaries of the Will (who are any persons listed in the Will as being entitled to receive a certain amount of the estate assets or income ) do not consider they received their fair share of the estate and they want to claim.
- Beneficiaries may also want to reorganise the distribution of the property or any real estate that has been bequeathed to them to minimise tax issues that would otherwise occur.
- Also, beneficiaries may seek to be provided with increased flexibility, access or usage through the timing of their inheritance distribution to children of 18, 21 or 25 years of age for proper accommodation or education.
- The executor (the person appointed to administer the assets of the estate) in the Will, may propose that the assets be re-distributed other than what the (original) Will stated. For this to occur the consent of all beneficiaries is required.
- The executor of the Will is not carrying out the instructions or is involved in misconduct relating to the property nominated within the Will.
- If a Will is deemed not to have considered any beneficiaries current situation, their desires or needs, they may take action to have the Will modified or altered.
- There are many small things which can invalidate Wills such as the absence of a simple word like “absolutely” or the need for specific wording can completely change the meaning of a phrase in the Will and may require a Judge to make an interpretation to determine its meaning. As would if the Will had not been properly witnessed.
HOW DOES THIS LEGALLY HAPPEN?
After death, one beneficiary of the Will (or other interested parties) can make a claim or inform the executor they plan to begin a Family Provision application due to their disappointment with the distribution of the deceased estate – such as the amount of what they may receive under the existing Will.
These challenges generally result in court proceedings. An application for Family Provision in New South Wales is made by the filing a summons together with an affidavit in the Supreme Court of New South Wales. Once this occurs the beneficiaries may consent to alter the distribution of the estate under the Will and enter into a Deed of Family Arrangement.
Deed of Family Arrangement
A Deed of Family Arrangement is a formal legal document recording the changed distribution of an estate where it is not made in accordance with the terms of the Will or the laws of intestacy (if you die without a Will, it means you died intestate). Then the estate will be distributed in accordance with the intestacy rules relevant within a particular State’s legal jurisdiction.
The main purpose of the Deed is to document the agreed distribution of the deceased assets and to protect the executor or administrator from further legal claims. If an agreement is reached by all the beneficiaries, this will avoid court proceedings being commenced.
The Deed of Family Arrangement rewrites the Will by mutual agreement. The reason most people would enter into a Deed of Family Arrangement is to either avoid or minimise a claim against the estate.
By, undertaking this action it will also alleviate the estate being tied up in the legal process for months or even years. This will also reduce the cost of the estate and stress on all the beneficiaries.
If this occurs several points need to be considered:
- it is recommended that legal advice is sought on the actual wording of the Deed to make sure it’s legally binding
- the Deed must be signed by all the concerned parties including the executor of the estate
- this Deed (terms of the agreement) should be submitted to the court to ensure certainty.
OTHER IMPORTANT POINTS TO CONSIDER
- the Deed must be entered into before the administration of the estate is complete. Like most aspects of the law, there are certain exceptions on which a court may consider applications after the event
- the Deed must have been entered into in order to settle a claim to take part in the estate, and
- the distribution of the assets of the estate to any beneficiary must only be as stated in the terms or conditions of the Deed.
SEEK LEGAL ADVICE
Remember, always seek independent and professional legal advice when preparing a Will and financial advice about any possible tax’s implications such as:
- stamp duty implications or concessions that may be available in relation to assets bequeathed in a Will
- in relation to the Australian Income Tax Assessment Act requirements. This is to make sure the legislative requirements are satisfied to confirm there are no undesirable capital gains tax consequences of entering into the Deed of Arrangement
- there are Australian Taxation Office Rulings (TR 2006/14) that offer further guidance for making certain the Deed will be covered by exemptions. (Sect. 128-20(1)(d)(i).
DIFFICULTIES WITH BENEFICIARIES AND CLAIMS ON A WILL
A proactive approach would be that the person making the Will attempts to have all the beneficiaries to their legal Will agree in writing to their percentage share or entitlements to the assets of the estate.
Also, it would be ideal to have all the nominated beneficiaries agree that they would not contest the Will. Developing a Deed in this manner would require the person making the Will and all the beneficiaries to seek independent legal advice before signing the document.
In Victoria and Queensland, this type of Deed will not be binding, as a person cannot sign away their rights to bring a Family Provision claim against the estate at a later date. The Deed will not be enforceable on the parties so the beneficiaries can still make a claim on the Will.
Whilst in New South Wales, it’s possible to apply to the court for an order approving the Deed.
Make sure everything is done in writing by a solicitor
Other potential disadvantages would be that once the person writing the Will discloses what they are considering providing to each of the beneficiaries there is the potential that the beneficiaries may:
- not satisfied with what they perceive they deserve in the proposed Will, or
- once a beneficiary has sought legal advice informing them of the legal possibilities, they may become unhappy with the motives of the person making the Will.
These actions may cause beneficiaries not to sign the proposed Deed of Family Arrangement. They may become resolute in their decision to make a claim against the estate or imply that they would after the person making the Will has died.
Another reason for the Will to be changed is if the financial circumstances of the beneficiaries may have altered dramatically from the time of signing the Deed to the Will being read.
This would make the prior arrangements concerning the distribution of the estate as stated in the Deed contrary to what the person making the Will was hoping to achieve. The development of any such situations would provide the grounds for at least one of the beneficiaries to make a claim against the estate to have the Will changed.
“The solution is having good legal advice”
Therefore, there are several possible drawbacks with attempting to develop a Deed whilst still alive. In an attempt to alleviate any problems arising could actually cause further family issues.
The instructions as set out in the Will may not be carried out as anticipated as they can be changed. It is important to remember the laws concerning Wills in Australia are different in every state, so it is essential to receive the correct legal advice as it pertains to the State that the person writing the Will resides in.
To read further about the range of other mistakes people make relating to End-of-Life Planning.
The overview of the laws contained here is those that primarily apply to New South Wales. While every effort has been made to ensure the information is up-to-date and accurate, it is not a substitute for legal advice about Wills. Use this article as a guide only and wherever possible seek legal advice for your particular circumstance.
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Sources used for this article
- Succession Act 2006 (New South Wales) – As at 1 December 2018 – Act 80 of 2006 New South Wales Consolidated Acts – Australasian Legal Information Institute A joint facility of UTS and UNSW Faculties of Law (accessed 1 April 2020)
- Rest assured: a legal guide to wills, estates, planning ahead and funerals in NSW by Rosemary Long and Trudy Coffey 6th edition, Published by the Legal Information Access Centre, State Library of NSW, 2019
- The Rules of Intestacy in Australia – FindLaw Australia
- New South Wales Government – Communities and Justice – Law Access NSW – After Someone Dies, (accessed 1 April 2020)
- Victoria Legal Aid – Find Legal Answers – Wills and Estates – Changing a Will, (accessed 1 April 2020)
- Queensland Law Handbook -Caxton Legal Centre Inc – Wills and Estates, Contesting a Will, 26 Sept 1918 (accessed 1 April 2020)
- State Library of New South Wales, Rest assured: a legal guide to wills, estates, planning ahead and funerals in NSW, 6th edition, by Rosemary Long and Trudy Coffey. Published by the Legal Information Access Centre (LIAC), State Library of New South Wales, 2019 (accessed 2 April 2020)
- Legal Services Commission of South Australia – Wills – Contesting a Will – Deed of Family Arrangement, 7th Jan 2020 (accessed 2 April 2020
- Relationships Australia, (2016), Research On-line Survey, May 2016: End of Life Planning, web site accessed 29th March 2020.
- NSW Trustee & Guardian, Attorney General & Justice, What is a Will? viewed at www.tag.nsw.gov.au/what-is-a-will.html
Frequently Asked Questions
Are Wills and Estate Planning the same thing?
A Will is a legal document detailing instructions regarding the disposal of property and assets after death including who would look after the children but doesn’t cover superannuation and it can be changed after death.
Can a Will from being changed after the death of the person writing it?
Not necessarily as one or more of the beneficiaries of the Will or other eligible persons can make, a Family Provision Application or the beneficiaries agree to alter the distribution of your estate set out in the Will. They may be able to enter into a Deed of Family Arrangement.
What is a Deed of Family Arrangement?
Is a legal document recording the agreement between the people regarding the changes to the distribution of the inheritance which had been set out in a Will which they had disputed so to avoid going to court.
When are Deeds of Family Arrangement used?
They can be used in a number of instances such as;
– If the deceased died intestate
– Where there is a doubt to the meaning due to the wording of the Will
– To comprise a claim against the estate where there is a challenge to the Will
– To create an estate proceeds trust under taxation legislation
When the beneficiaries want to alter the distribution rights of the deceased’s estate between themselves