Is it worth having a Will?

By Bob Cruickshanks and Hiteshi Dekhtawala

As Benjamin Franklin once said “In this world nothing can be said to be certain, except death and taxes.”.

Most people take the time and effort to prepare a will in which they detail how their accumulated worldly possessions are to be divided between their surviving relatives and/or friends. Also, a will can be part of a family asset protection strategy.

The alternative was that the person died “intestate” and their worldly possessions are distributed according to the laws of intestacy which in general terms, meant that the surviving spouse received one third of the estate and the other two thirds were divided equally between their children irrespective of how many. Hence the importance of leaving a will.

As family relationships grow or disintegrate, the person often changes their will. In days of old, a dying person could be quite certain that the distribution of their accumulated worldly possessions would be in accordance with their wishes.

However with the advent of the Family Provision Act 1969, that degree of certainty was lost and relatives who were dissatisfied with their entitlement under the will of the deceased could apply to the Court for an order that be given their due entitlement. Such claims needed to be made within 18 months from the date of death.

The Succession Act 2006 which replaced the Family Provision Act 1969 is basically the same except that claims must be made within 12 months of the date of death.

As some people marry more than once and/or have multiple relationships, the task of the Supreme Court in deciding the merits of claims made under the Succession Act has become more difficult. However, that task has become even more difficult with the advent of the “de-facto son and daughter” who is a non-relative but claims to have had a relationship with the deceased that was identical or very similar to a parent and child relationship.

So in some instances, the will of the deceased is just the “starting point” when it comes to the manner in which the accumulated worldly possessions of the deceased person are distributed.

In days of old in a bankruptcy situation should the bankrupt have had an entitlement under a will of a person who died either before or during the period of bankruptcy, the trustee could reliably inform creditors of the expected entitlement and how much in monetary terms it would increase their dividend.

However the trustee must now cautiously wait to see if a claim is made by a dissatisfied person within the 12 month statutory period which if successful, would dilute the quantum of the bankrupt’s entitlement and in turn reduce the rate of return to creditors

It is in such situations that the Bankruptcy Trustee will exercise his/her expertise and experience in achieving the best result for the bankrupt estate including conducting exhaustive investigations into the legitimacy of claims from de facto relatives and of course, upon obtaining legal advice where necessary.

Interestingly, if a bankrupt is dissatisfied with their entitlement or perceived entitlement, the right to bring a claim under the Succession Act is a personal right and does vest with the trustee of their bankrupt estate. However, if they are successful and the Court awards them “divisible property” (e.g. Money, shares, real estate etc.) whilst they are bankrupt, the property goes into their bankrupt estate.