Please note: This is a fictionalised version of a real outcome in the Supreme Court of Victoria.
The purpose of the #contestawillwithrobinsongill series is to educate the public about the risks, opportunities and realities of disputing wills and estates in plain English.
What happens when a parent’s Will leaves behind more than they own, to multiple beneficiaries?
When Stephen passed away, he left behind four sons - Leo, Andrew, Martin, and Daniel. Leo and Andrew were both intellectually disabled.
Stephen also left behind his partner, Alicia. Stephen and Alicia had been in a relationship for 14 years prior to his death, and they lived together in Stephen’s family home. Alicia had a close relationship with all four of Stephen’s children.
Stephen’s estate was worth about $2 million when he died. It consisted of the family home, which was valued at around $1.7 million, and an additional $300,000 in cash.
Stephen’s Will was complicated. He wanted Alicia, Leo and Andrew to be able to stay in the family home after his death. He also wanted one of his other sons, Martin, to be able to live in the property if he ever chose to. Finally, he wanted to leave substantial cash gifts to both Martin and Daniel.
In order to achieve this, he left each of three of his sons, as well as his partner, varying “life interests” in the family home. This meant that each of these family members would be able to reside there for the rest of their lives if they chose and at their passing, the interest would come to an end. After this point, the property was to be sold and the proceeds distributed to the various surviving family members in various proportions.
Unfortunately, the value of the estate was such that the beneficial entitlements and pecuniary legacies outweighed what there actually was to distribute.
Stephen’s disabled sons, Leo and Andrew, were unhappy about the situation, and made a claim on the estate.
Reconciling the Deceased’s Wishes with Reality
The Court’s role in this case was to reconcile Stephen’s wishes (as set out in his Will) with the practical reality of the assets that were available, and his family members’ respective claims to them. The main question was whether the family home would need to be sold in order to achieve this.
The Court had to consider whether (given the number of claimants and the limited cash assets available outside of the property), it was possible to sufficiently and proportionally provide for each family member in line with Stephen’s wishes, without it becoming necessary to sell up.
When making its decision, the Court took the following key factors into account:
- The Court could not simply ignore Stephen’s testamentary wishes, even if they did not necessarily meet his moral obligations towards Alicia and his two disabled children. Although the Will was structured in a complicated way, Stephen’s intentions were ultimately very clear.
- The connection that each family member had to the property was an important consideration. In particular, Stephen’s partner, Alicia, had developed an intense attachment to the family home. While this was important, it had to be weighed against her actual beneficial entitlement, as well as that of each of Stephen’s four sons.
- The fact that both of Stephen’s disabled sons were in receipt of NDIS (National Disability Insurance Scheme) funding was significant. The Court had to assess whether this benefit was already sufficient to meet their accommodation and living expenses. It concluded that their ongoing needs were almost certain to be met by the scheme.
- Stephen had left a particularly large cash benefit to his fourth son, Daniel. This had to be taken into account and weighed against the gifts that remained available to the other beneficiaries.
In making its final judgement, the Court held that it was not necessary for the property to be sold in order to meet the needs of the claimants. However, it did make an order setting out the way that the value of the property was to be distributed if it was ever sold, either prior to or following Alicia’s death.
Key takeaways
Real life scenarios, like Stephen’s, provide a number of valuable insights if you are considering contesting a will. Our key takeaways from this story are:
- Always seek legal advice from an experienced estate litigation lawyer when creating your Will. They will ensure that all factors and variables are considered and taken into account, particularly in complex cases involving multiple beneficiaries.
- If you are a family member of a deceased relative, and find yourself as part of a pool of beneficiaries in a Will which has bequeathed more assets than are available, seek legal advice as early as possible from an experienced estate litigation lawyer.
- If you are a beneficiary in receipt of NDIS funding, this may affect your entitlement in any contested claim. The Court often treats NDIS as distinct from other means-tested government benefits. Receiving this funding does not, in itself, mean that a testator does not have a duty to provide you with any maintenance or support. However, it is likely to be taken into account by the Court as a significant factor when assessing a claim.
- If you receive a “less than expected” entitlement from a Will, seek advice as early as possible. In Victoria, a Will may only be contested if a claim is made within 6 months of probate or letters of administration being granted (some exceptions do apply).
- Successfully contesting a will can have significant financial consequences, and legal fees are often funded by the estate itself. Always consult an experienced estate litigation lawyer to determine whether or not bringing a claim is likely to be worthwhile.
How can I learn more?
Rachael has helped a number of individuals successfully dispute wills that they have been unfairly left out of or left inadequate provision. She also has experience in defending claims made by individuals against deceased estates.
Some other resources you
might find helpful
Estate Planning Document Health Check
If you have not reviewed your Will and Powers of Attorney recently, you may want to review these documents to ensure that they are up to date with your current circumstances.
Supportive Powers of Attorney
If you or someone you care for requires assistance in understanding, making or executing personal and financial decisions, then you may want to prepare a Supportive Power of Attorney.
Appointment of Medical Treatment Decision Maker document
An enduring power of attorney (medical treatment) is a document whereby you appoint someone (your medical agent) to make decisions regarding your medical treatment when you are unable to decide for yourself.