Home » Property Law » Understanding Deceased Estates in NSW: Contesting Wills, Grandchildren’s Rights, & Estate Tax Implications
Understanding Deceased Estates in NSW: Contesting Wills, Grandchildren’s Rights, & Estate Tax Implications
Contesting a Will NSW
Contesting a Will in New South Wales (NSW), Australia, involves a legal process that allows eligible people to challenge the validity of a Will or claim a larger share of the deceased person’s estate. The process can be complex, and it’s important to understand the grounds for contesting a will and the steps involved. Here’s a general overview of things to consider when determining if you need to contest a will:
1. Grounds for Contesting a Will:
There are several grounds on which you can contest a will in NSW. These include:
- Lack of Testamentary Capacity: That the deceased did not have the mental capacity to make the will.
- Undue Influence: That the deceased was either coerced, manipulated, or unduly influenced by someone else into making certain provisions in the will.
- Fraud or Forgery: If the will was obtained through fraudulent means or if the signature or content of the will was forged.
- Family Provision Claim: If you are an eligible person (such as a spouse, child, or dependent) and believe that you were not adequately provided for in the will, you can make a claim for a larger share of the estate’s assets.
2. Seek Legal Advice:
Contesting a will can be a complicated legal process, and it’s important to consult with an experienced estate lawyer who specialises in this area.
At ALA Law our Senior Lawyers can assist you to determine if contesting a will is appropriate and the likelihood of success.
We can provide guidance on whether you have valid grounds for contesting the will and help you understand your rights and options.
3. Mediation or Negotiation:
At ALA Law we are focused on resolution. Prior to proceeding to court we attempt to mediate or negotiate a resolution. This can save time, money, and emotional stress.
If an agreement is unable to be reached, we will then proceed to litigation to protect your interests.
4. Commence Proceedings in the Supreme Court of NSW
If mediation doesn’t result in a resolution, and you still wish to contest the will, your dedicated lawyer at ALA Law will help you lodge a summons with the Supreme Court of NSW on the basis or grounds of which you are contesting the will.
5. Court Proceedings
The matter will then proceed in the Supreme Court of NSW. Depending on the application you have made to set aside the will, the matter might be referred to “court annexed mediation” or set down for hearing in front of a Judge.
All parties to the proceedings (those contesting the will and the executors or beneficiaries of the will) will need to file evidence and present their cases, present evidence, and call witnesses if necessary.
6. Court’s Decision:
The court will consider the evidence and arguments presented by both sides and make a decision based on the merits of the case. The court may uphold the validity of the will, modify its provisions, or order a different distribution of the estate assets.
7. Appeal
If you disagree with the court’s decision, you may have the option to appeal the decision. Appeals can be complex and require further legal representation.
It’s important to note that contesting a will can be emotionally taxing and legally intricate. Additionally, there are strict time limits for initiating these proceedings. Therefore, if you believe you have valid grounds for contesting a will, it’s advisable to seek legal advice promptly.
At ALA Law we can guide you through the process, help you understand your chances of success, and represent your interests effectively.
On What Grounds Can You Contest a Will in NSW
In NSW there are several grounds in which you can contest a Will, including if you believe the will is invalid, or you have not been adequately provided for as an eligible person.
In NSW there are several grounds in which you can contest a Will, including if you believe the will is invalid, or you have not been adequately provided for as an eligible person.
These grounds include;
- To set aside a will:
- Lack of Testamentary Capacity
- Undue Influence
- Fraud or Forgery
- Incorrectly executed Will or Lack of Formality
- To seek further provision from a Will:
- Undue Influence
- Family Provisions Claim
Each of these grounds to contest a will in NSW are detailed below.
If the testator (the person who made the will) did not have the mental capacity to understand the nature and consequences of their actions when creating the will, the will may be considered invalid. This might apply if the testator was suffering from a mental illness, dementia, or other cognitive impairments at the time of making the will.
If it can be proven that someone exerted undue influence, coercion, or manipulation over the testator, causing them to make provisions in the will that they otherwise wouldn’t have made, the will could be contested.
If the will was obtained through fraudulent means or if there is evidence of forgery in the signatures or content of the will, it may be contested.
For a will to be valid in NSW, it must meet specific legal formalities.
For example, it must be in writing, signed by the testator in the presence of two independent, adult witnesses who also sign the will. If these formalities are not followed, the will could be challenged.
Under the Succession Act 2006 (NSW), certain eligible persons can contest a will by making a family provision claim. These eligible persons include:
- The spouse or de facto partner of the deceased.
- Children (including adult children) of the deceased.
- Former spouses or de facto partners of the deceased.
- Individuals who were financially dependent on the deceased.
A full list of eligible persons can be found here http://classic.austlii.edu.au/au/legis/nsw/consol_act/sa2006138/s57.html
To contest a will on family provision grounds, the claimant must demonstrate that they have not been adequately provided for in the will and that this failure to provide adequately is unfair and unreasonable.
The court then considers factors like the financial position of the claimant and other beneficiaries, the nature of the relationship between the claimant and the deceased, and the moral obligations of the deceased.
It’s important to consult with an experienced estate lawyer if you believe you have grounds to contest a will. They can provide personalised advice based on your situation and guide you through the legal process. Keep in mind that there are strict time limits for contesting a will, so seeking legal advice promptly is essential.
At ALA Law our Senior Estate Lawyers will guide you in a caring, compassionate manner throughout the proceedings and provide you with real advice to help you move towards a resolution.
Can Grandchildren Contest a Will in NSW?
In NSW a grandchild, if they meet certain eligibility requirements, may be able to contest a will. Grandchildren are not within the clear definition of an ‘eligible person’ under s.57 of The Succession Act 2006 (NSW) as a person who is eligible to apply, but in some cases may meet the eligibility criteria by other means.
To contest a will as a grandchild, the following conditions generally need to be met:
Eligibility
Grandchildren are not automatically eligible to contest a will.
To be eligible, a grandchild typically needs to establish that they were either:
- financially dependent on the deceased or
- that they had a close personal relationship with the deceased.
Financial Dependency
A grandchild can potentially contest a will if they were financially dependent on the deceased at some point in the past or were receiving financial support from the deceased.
The level and duration of financial dependency are important factors that the court will consider.
As families blend, and young adults remain longer in the home of relatives due to the cost of living and housing, it is not unusual for grandchildren to live with a grandparent or in the property of a grandparent relying on their financial support to get ahead.
This kind of arrangement can create a financial dependency between the grandchild and the grandparent, therefore enlivening the eligibility criteria.
Close Personal Relationship
Even if there was no financial dependency, a grandchild may still be eligible to contest a will if they had a close personal relationship with the deceased.
This could include situations where the grandchild had regular contact, shared a living arrangement, or had a significant emotional bond with the deceased.
This ground of eligibility is notoriously difficult to pursue, being a last resort for eligibility if the grandchild meets other eligibility criteria.
What about Unfair Provision in a will?
In some cases, a grandchild has had provisions made for them in a will, but this is considered insufficient and gives rise to a claim of “unfair provision”.
In a family provision claim, the grandchild would need to demonstrate that they have not been adequately provided for in the will and that the provision made for them is unfair and unreasonable considering their financial needs, relationship with the deceased, and the needs of other beneficiaries.
This process requires evidence to be produced by the grandchild as to their needs and compete against the needs of the other beneficiaries listed in the will who would be adversely affected by the claim.
Where to from here?
It’s important to note that contesting a will can be a complex legal process, and the eligibility criteria can vary based on the individual circumstances of the case. If you are a grandchild who believes you have grounds to contest a will, it’s advisable to seek legal advice from an experienced estate lawyer.
At ALA Law we can assess your situation and guide you through the process, helping you understand whether you meet the eligibility requirements and whether pursuing a family provision claim is in your best interest. Keep in mind that there are strict time limits for making a family provision claim, so seeking legal advice promptly is essential.
Are there death taxes in Australia?
At ALA Law we often get asked if there are specific “death taxes” in Australia at the federal level, including in New South Wales (NSW). The simple answer is No – there is not a specific ‘death tax’ BUT that doesn’t mean that your inheritance or assets within the estate won’t be taxed if not properly estate planned and administered by your Executors in a tax effective way.
However, it’s important to note that the taxation landscape can change over time, and different types of taxes may apply to your estate after your passing, that didn’t exist at the time you planned your estate.
In Australia, even though there is no ‘death tax’, you can be required, as an individual beneficiary or the Estate, to pay taxes in the following circumstances and events:
If the Estate contains investment properties or shares that are to be disposed of (sold) as part of the Estate than this sale will usually trigger CGT payable by either the beneficiaries or by the Estate.
If that investment is to be transferred, the transfer will not usually trigger CGT, but the CGT liability that attaches to that asset will pass to the beneficiary.
In Australia, if you gift your Superannuation or your Life Insurance to someone who is NOT your spouse or a dependant minor child (e.g: to your adult children) there will be tax payable on this amount by your beneficiaries. This is usually then disclosed in their personal tax return and adjusted on marginal tax rates.
The key to avoiding this tax is to ensure that you gift your super to a spouse or dependant minor child OR you remove from your superannuation prior to your death, if you have passed preservation age, if your gifting it to adult non dependent children.
The ATO outlines what you need to consider regarding tax implications of superannuation https://www.ato.gov.au/Individuals/Super/Withdrawing-and-using-your-super/Tax-on-super-benefits/?page=6#Super_death_benefits
Although not a tax in itself, when the executor of a deceased person’s will applies for probate or administration of the estate, there are usually fees associated with this process. These fees are not technically taxes but are administrative costs incurred during the distribution of the estate. This consists of the Probate/Letters of Administration Filing fee to the Court and the legal fees of the lawyer (which in NSW are set to a scale and are prescribed).
In NSW most transfers pursuant to a will only pay a nominal stamp duty fee of $50
Revenue NSW
“1. Section 63 of the Duties Act 1997 (‘the Act’) provides concessional duty for transfers of dutiable property by the legal personal representative of a deceased person to a beneficiary.
2. Section 63(1)(a) provides that duty of $50 is chargeable in respect of a transfer of dutiable property by the legal personal representative of a deceased person to a beneficiary, being:
- a transfer made under and in conformity with the trusts contained in the will of the deceased person or arising on an intestacy, or
- a transfer of property, the subject of a trust for sale contained in the will of the deceased person, or
- an appropriation of the property of the deceased person (as referred to in sec.46 of the Trustee Act 1925 (NSW)) in or towards satisfaction of the beneficiary’s entitlement under the trusts contained in the will of the deceased person or arising on intestacy.
3. Section 63(2) of the Act provides that, if a transfer of dutiable property is made by a legal personal representative of a deceased person to a beneficiary under an agreement (whether or not in writing) between the beneficiary and one or more other beneficiaries to vary the trusts contained in the will of a deceased person or arising on intestacy, the dutiable value of the dutiable property is to be reduced by the portion of the dutiable value that is referable to the dutiable property to which the beneficiary had an entitlement arising under the trusts contained in the will or arising on intestacy.
4. Section 63(2A) of the Act provides that a transmission application made by a beneficiary under a will, with the consent of the legal personal representative of a deceased person, is taken to be a transfer of dutiable property by the legal personal representative to the beneficiary.
5. Section 163A(1)(d) exempts an acquisition by a person of an interest in a landholder, if the interest was acquired solely as the result of the distribution of the estate of a deceased person.
It’s important to consult with legal and financial professionals who are up-to-date with the current tax laws in NSW and Australia. Taxation laws and regulations can change, and the details of your personal situation may also impact any taxes or duties that apply to your estate after your passing. Always seek advice that is tailored to your individual circumstances and the most current legal landscape.
Who is entitled to a copy of the Will in NSW?
In New South Wales (NSW), Australia, the people entitled to a copy of the Will are set out in s.54 of the Succession Act (2006) NSW which include:
“ Persons entitled to inspect will of deceased person
54 Persons entitled to inspect will of deceased person
(1) In this section–
“will“ includes a revoked will, a document purporting to be a will, a part of a will and a copy of a will.
(2) A person who has possession or control of a will of a deceased person must allow any one or more of the following persons to inspect or be given copies of the will (at their own expense)–
- (a) any person named or referred to in the will, whether as a beneficiary or not,
- (b) any person named or referred to in an earlier will as a beneficiary of the deceased person,
- (c) the surviving spouse, de facto partner or issue of the deceased person,
- (d) a parent or guardian of the deceased person,
- (e) any person who would be entitled to a share of the estate of the deceased person if the deceased person had died intestate,
- (f) any parent or guardian of a minor referred to in the will or who would be entitled to a share of the estate of the testator if the testator had died intestate,
- (g) any person (including a creditor) who has or may have a claim at law or in equity against the estate of the deceased person,
- (h) any person committed with the management of the deceased person‘s estate under the NSW Trustee and Guardian Act 2009 immediately before the death of the deceased person,
- (i) any attorney under an enduring power of attorney made by the deceased person,
- (j) any person belonging to a class of persons prescribed by the regulations.
Note : ”De facto partner” is defined in section 21C of the Interpretation Act 1987 .
(3) A person who has possession or control of a will of a deceased person must produce it in a court if the court requires the person to do so.”
It’s important to note that the process of obtaining a copy of a will is typically handled through the probate or estate administration process. The will is usually filed with the Supreme Court of NSW as part of the probate application, and interested parties can access it through the court.
However, not everyone is automatically entitled to receive a copy of the will. The distribution of a copy may be subject to legal procedures, confidentiality considerations, and the specific terms of the will itself.
If you are seeking a copy of a will or have concerns about your entitlement to it contact us at ALA Law, so we can assist you through the process and provide you with relevant advice.
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