A will is a document that sets out how you wish to dispose of your property once you pass away. They can cover items such as:

• How much money you would like to leave to a friend, family member or charity;
• How you want your possessions to be dealt with e.g. by leaving it to someone, by sale or by donation;
• How you wish your funeral to be arranged; and
• How your family and friends may be able to pay for the funeral e.g. from the proceeds of selling your car, with the remainder being left in a way you would prefer.

Dying without a valid will is known as intestate. This situation arises when you either:

• Pass away without a will; or
• Pass away with a will that is invalid either because it does not dispose of with all of your property and/or does not comply with statutory requirements.

It is a common perception that if you do not have anything to leave, or you cannot decide how you want your property disbursed or there is no urgency that you do not need a will. However, there can be extensive delays and additional expenses when your loved one are dealing with your property if you die intestate.

WHAT HAPPENS IF I DIE WITHOUT A WILL?

If you pass away without a plan entirely or an adequate plan to deal with your property, assets or funeral arrangements, then there may be consequences for you and your family that have not been considered by yourself. This could include situations where:

• Your property is distributed in ways you might not have wanted or agreed with;
• Having a long-lost relative make a claim for a portion of your property which you may not have considered or wanted; or
• Having an independent administrator appointed to deal with your intestate estate which may lead to a reduction in the entitlements available to your family or friends who you may have wanted to leave something to.

An administrator is a person or agency appointed by the Supreme Court of NSW to deal with your property if you do not have a will and further an executor to do this for you. The administrator must collect your assets, pay your debts, taxes, and funeral and then distribute the remaining estate in accordance with the law.

The NSW Trustee and Guardian is a government agency that can administer estates of people who die without a will. However, it is important to be aware that there may be additional costs associated with administering the estate. These costs will then be deducted from the estate.

WHAT THE LAW SAYS

The Succession Act 2006 (NSW) provides for circumstances where people die intestate including the priority and the share. The main things to be aware of are summarised below:

Survivorship

To be entitled to an intestate’s estate, you must be born before the intestate’s death and survive them by at least 30 days.

1. Spouse:

• A spouse includes a spouse that was married to the intestate before their death or a de-facto partner for at least 2 years or a person who the intestate had a child with; OR
• If there are no children or the children are those of the intestate and the spouse then the spouse is entitled to the whole of the intestate estate which is whatever remains after taxes, debts and funerals are paid for; OR
• If there are children surviving who are not children of the spouse then the spouse is entitled to their personal effects, the legacy amount of $350,000 adjusted with the consumer price index and one half of the remaining intestate’s estate (if any).

2. Multiple Spouse:

• If there are multiple spouses or de-facto partners then the intestate’s estate is divided by a written agreement, equally or by an order from the Supreme Court of NSW; OR
• If there are multiple spouses or de-facto partners and children including children from ex-spouse’s:
  • the spouse or spouses as agreed are entitled to the intestate’s personal effects, the legacy amount of $350,000 adjusted with the consumer price index and one half of the remaining intestate’s estate (if any).
  • All children are entitled to receive the remaining amount of the estate.

3. Children only (including grandchildren):

• If there are no surviving spouses, then the children are entitled to the estate depending on how many children there are surviving. If there is only one child remaining this child is entitled to the whole intestate estate, if there are two then this share is shared equally between the two.

4. If none of the above apply, then the intestates estate will be distributed in order of priority to:

• The surviving parent or shared equally between surviving parents;
• The surviving siblings;
• The surviving grandparents; and
• The surviving uncles and aunts.

No person entitled

• If there is no one to leave your estate to, the whole of the intestate’s estate will go to the state.
• The state then has the discretion to waive their rights to an individual or organisation upon application if they:
  • Are dependents of the intestate;
  • Have a just or moral claim in the intestate’s estate; and
  • Would have reasonably expected to have been provided for in the intestate’s estate;

As you can see, dying without a valid will can cause more delays and expenses than you may have imagined and added stress to your remaining family when dealing with the consequences of your passing. Unfortunately, the departed do not get a say if you die this way. It is always a good idea to avoid these issues by ensuring you have a valid will executed to ensure your property is distributed to who you want in the way you want.

If you have a will in force that has not been updated after you have been married or divorced or other circumstances have changed, it is always best to ensure your last will and testimony changes with you. It is also important that if you have a will prepared, the location of the will is known to someone who you trust or with a lawyer who can contact your appointed executor to carry out your wishes.

For further information and advice give Pannu Lawyers a call on (02) 9920 1787.