Wills & Estates

Monday, March 19, 2018

The laws that determine how an estate will be distributed when there is no will.  These rules are contained in the Succession Act 1981.

Word or Phrase Description
Ademption Occurs when property gifted in a will is no longer in the testator’s estate at the time of the testator’s death.
Administration The process of collecting the assets, paying the debts, and distributing the estate in accordance with the will (or, if there is no will, in accordance with the intestacy rules).
Advance Health Directive A special form of document that gives directions about a person’s health care wishes.
AHD See Advance Health Directive.
BDBN See Binding Death Benefit Nomination.
Beneficiary A person who is entitled to a portion of an estate or trust.
Binding Death Benefit Nomination A direction that obligates the trustee of a superannuation fund to pay superannuation death benefits to a particular person or to the estate.  Not every superannuation fund recognises a BDBN.
Blended Family A family consisting of two or more families after getting remarried after divorce.  Blended families can raise particular issues with estate planning and estate disputes.
Business Succession Planning Making sure that your business is able to carry on without you.
Challenging a will See “Contesting a will”.
Child A person under the age of 18 years, including adopted children or step-children.  It also refers to adult children, who have rights in relation to their parents’ estates.
Codicil A document that amends a will.  It must be properly signed and witnessed, like a will.
Construction of a will How a will is construed (interpreted).  In other words, the meaning of the will.  While probate is concerned with determining what the will says, construction is about determining what the will means.  If there is uncertainty about the meaning of a will, an interested party can apply to the Supreme Court to have the will construed.
Contested probate Also called “Probate in Solemn Form”.  When there are doubts about the validity of a will, the court can be asked to determine whether a particular will is valid.  The most common basis for contesting the validity of a will is that there is doubt about the testamentary capacity of the person who made the will.  Another basis for contesting the validity of a will is that the will was made as a result of undue influence.  The validity of a will may also be contested on the basis of lack of knowledge and approval.
Contesting a will The main ways of contesting a will are by contested probate or by a family provision application.
De facto partner A de facto partner may be entitled to a share of an estate under the intestacy rules.  A de facto partner may also be entitled to make a family provision application.  For the purposes of the Succession Act 1981, the definition of de facto partner is found in section 32DA of the Acts Interpretation Act 1954 (Qld)
Deductible Gift Recipient (“DGR”) A DGR is recognised by the Australian Tax Office as a charitable entity that is entitled to receive income tax deductible gifts. Your will may gift part of your estate to a DGR.
Donatio mortis causa Latin phrase describing a binding verbal gift, where the gift is made in expectation of imminent death.  Plural: donationes mortis causa.  A will must be in writing, but this type of gift can be verbal.
Duress The use of threats, violence and other constraints to influence someone into doing something against their will or better judgement.
Enduring Power of Attorney A special form of document authorising someone to act on behalf of another person.  It is “enduring” because it continues to be effective when the person making it no longer has capacity to manage their own affairs.
EPA See “Enduring Power of Attorney.”
Estate All of the assets and liabilities of a deceased person.  The word can also apply to the affairs of a living person, but it is not commonly used in that context except in a bankruptcy.
Estate Administration When you are the executor of a will and you need help attending to paying the final bills and distributing the assets to the beneficiaries, we are able to provide this service.
Estate Planning The process of anticipating and arranging, during a person’s life, for the management and disposal of that person’s estate during the person’s life and after death.
Executor/ Executrix/ Executrices A person appointed by a will to administer a deceased person’s estate.  Executrix is the feminine version, and “executrices” is the feminine plural.  Nowadays, “executor” is used as a term that is gender-neutral.
Execution The formal process of signing your will and having it witnessed.
Family Provision Application The spouse, children (including step-children), and some categories of dependants of a deceased person may be entitled to claim further provision from an estate, overriding the terms of a will or the intestacy rules.  In Queensland, this type of claim can be brought in the District Court or the Supreme Court, depending on the amount of provision claimed.  The court may override the will (or the intestacy rules) if the applicant shows a need for further provision from the estate.
FPA See “Family Provision Application”.
Further provision See “Family Provision Application”.
Guardianship See “Testamentary Guardian.”
Infant At law, an “infant” is anyone who is not an adult.
Intestacy An estate where there is no will.
Intestacy Rules The laws that determine how an estate will be distributed when there is no will.  These rules are contained in the Succession Act 1981.
Inadequate Provision Where a person has left by their will (or intestacy) insufficient for the needs of their spouse, child or dependant.
Joint tenancy A form of property ownership between two or more people, where the survivor/s automatically take complete ownership of the property on the death of any of the co-owners. In contrast, see tenancy in common.
Knowledge and approval For a will to be valid, the testator must know and approve what is in the will.
Letters of administration on intestacy Where there is no will, the court may appoint someone to administer the estate in accordance with the intestacy rules.  The court’s authorisation is called letters of administration.
Letters of administration with the will annexed Also known by the Latin phrase “Letters of administration cum testamento annexo.”  When the executor does not obtain probate, another person may be appointed by the court (by being granted letters of administration) to administer the estate in accordance with the will.
Mediation Resolving an estate dispute (most commonly a Family Provision Application) with the use of a third party as a mediator between the parties.
Mutual wills Wills made in accordance with an agreement that the testators will leave their estates in a particular way.
No Win No Fee If you want to contest a will, we can consider the details of your claim, the number of other potential beneficiaries and the size of the estate and consider if we will act for you on a “no win no fee” basis.
Probate A document issued by the Supreme Court confirming the authority of the executor to administer an estate.
Probate in Solemn Form See “Contested probate”.
Reading of a will Formal meeting where a lawyer will discuss the will in detail for friends and family of the deceased. A reading of the will can occur before or after a funeral.
Revocation of a Will Cancellation of a will, generally by making a new will.
Rule in Saunders v Vautier The rule under which beneficiaries of a trust, if of full age sound mind and unanimous, may direct the trustees to end the trust and transfer the trust property to themselves as beneficiaries absolutely.
Rule against Perpetuities This rule requires that no interest in property is valid unless it vests (other than under a trust) not later than twenty-one years, plus the period of gestation, after some life or lives in being which exist at the time of the creation of the interest.  More commonly, the period of 80 years applies. This rule ensures that a testator cannot make any provision regarding property that would impact the property long after the testator has died.
SMSF Self Managed Superannuation Fund.  An SMSF is governed by its trust deed and by other relevant laws such as the Superannuation Industry (Supervision) Act 1993 (Commonwealth).
Solemn Form Probate See “Contested probate”.
Statutory Will An uncommon term for when a court approves the making of a will for someone who does not have testamentary capacity.
Succession Act 1981 This is the main statute that governs succession law in Queensland.
Succession Law The area of law that deals with inheritance upon death.
Superannuation Superannuation death benefits do not automatically form part of an estate.  This will depend on whether the trustee of the superannuation fund exercises a discretion (or is obligated, pursuant to a binding death benefit nomination) to pay the superannuation to the estate.
Tenancy in Common A form of property ownership between two or more people, where a deceased owner’s share becomes part of his/her estate, which he/she is able to dispose of in a will. In contrast, see joint tenancy.
Testamentary Capacity

Testamentary capacity refers to the mental capacity of a person to make a will.  A person may have sufficient mental capacity to make a will even though they are physically incapacitated.  The following is one way of stating the legal tests for testamentary capacity (paraphrasing the test in Banks v Goodfellow, as re-stated in Read v Carmody):

  • Did the testator have the capacity to understand the legal nature and significance of making a will?
  • Was the testator capable of being aware of, at least in general terms, the nature, extent and value of the testator’s property?
  • Was the testator capable of being aware of those who may reasonably be thought to have a claim upon the testator’s testamentary bounty, and the basis for, and nature of, the claims of such persons?
  • Did the testator have the ability to evaluate, and to discriminate between, the respective strengths of the claims of such persons?
  • Did the testator suffer from a condition (whether “mental illness” [or psychosis] in the strict sense, or any other form of “mental disorder”, including, but not limited to, deterioration in higher intellectual function, or dementia) which detrimentally affected the testator’s consciousness or sense of orientation, or which had brought about disturbances to the testator’s intelligence, cognition, thought content, thought processes, judgment and the like (whether or not that condition may be transient, or, if appropriately treated, reversible)?

If the testator fails any of those tests, then he/she does not have testamentary capacity.

Testamentary Guardian

Person/s appointed by your will to look after your infant child/ren.

Testamentary Trust

A type of trust created by your will.

Testamentary Discretionary Trust

A testamentary discretionary trust is one where the trustee has the discretion to distribute capital and income in the same or differing proportions between a group of beneficiaries nominated in a will.

Testator/Testatrix

A person who makes a will.  Testatrix is the feminine version.  Nowadays, “testator” is used as a term that is gender-neutral.

TFM

Testator’s Family Maintenance application; same as FPA.

Trust

A trust exists where the legal owner of property holds that property for the benefit of the beneficiaries of the trust.

Trustee

An individual person or company who has control of property in trust with a legal obligation to administer it solely for the purposes specified in the trust.

Undue Influence

When a person has been coerced into making a will, that will is invalid as it is said to have been made as a result of undue influence.

Will

A revocable disposition of property, taking effect upon death.

Will-Maker

See “Testator/Testarix.”

Witness

Person who is present when you sign your will and sees you sign it.

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