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In Australia, we recognise a persons freedom to dispose of assets after death any way they wish. However, there are limits to this freedom.
Even where you have taken the proactive steps of making a Financial Agreement and a Will, your wishes may still be contested by an eligible person under family provision legislation.
Family provision legislation varies slightly from state to state. It allows an eligible person to make a “family provision” application to the Court if they have not been provided for in a Will.
An eligible person may be a spouse (including a de facto spouse or ex-husband or wife), child/ren (including adopted and step children), grandchildren or other dependents.
The exact requirements for an application to be successful differ from state to state. In New South Wales, for example, a court will only make an order granting a share of the estate to an eligible person if it finds that “adequate provision” has not been made for that person’s proper “maintenance, support, education and advancement in life”.
In making their decision, the Court will balance the intentions and wishes of the Will maker, as well as the circumstances of the person who has made the application, such as;
- the applicant’s financial position,
- whether or not he/she was dependent on the Will maker,
- the relationship between the will maker and the applicant,
- the value of the estate,
- the beneficiaries and any obligation of the Will maker to the beneficiaries
- and other pertinent issues.
While Financial Agreements are not conclusive in determining a family provision application, they may be taken into consideration by the Court to better understand the relationship and intention of the parties.
This may make a big difference to a potential claim, as evidenced in court decisions such as Hills v Chalk and Kozak v Matthews. The court found that the applicants in this cases were not entitled to receive a share of the estate of their deceased partner.
Go to Next Article – Summary of Kozak v Matthews (where defacto partner contests a Will)