Nick Bruining: Answers to everything you need to know about a will and challenging an inheritance

We asked estate planning expert Morgan Solomon, of Solomon Hollett Lawyers, to answer five of the most common questions we see land in the Your Money email inbox.

Question

Would a grandchild be able to launch a dispute seeking a partial inheritance, based on the fact they were ignored in a will?

Answer

Yes, but only if they meet the criteria.

There are two types of claim for a grandchild: those who were dependent on the deceased at the date of death and those whose parent had already died. Both of these types can seek adequate and proper provision.

Grandchildren’s claims are a very fast-growing class of claimant and a common example is a grandchild whose private school fees were being paid for by their grandparent.

A grandchild whose parent has already died is treated no differently than the child if they were to bring a claim to seek provision from the will.

Question

If an estate becomes bankrupt after making the distributions to beneficiaries in preference to debtors, is anyone liable for the outstanding debts?

Answer

An executor who does not pay debts of the deceased first before making distributions to beneficiaries can be personally liable for the outstanding debts.

It is crucial that the executor thoroughly works out everything the deceased properly owed to others before giving anything to the beneficiaries. This includes final tax returns, funeral costs, loans made by the deceased during life and even hidden debts.

Executors should advertise in the classified section of the newspaper to find out if there are any hidden debts and call them in. If they don’t, they may have to personally foot the bill.

Question

How long does an executor have to deal with a will?

Answer

There is no fixed time limit, as each and every estate is unique and has its own challenges and pathways toward completion.

There is a concept known as an “executor’s year” which is a loose idea that a prudent executor should have completed administration, or be well advanced toward completion, within 12 months of a grant of probate.

Modern estates are much more complex than ever before, and much harder and slower to administer.

An estate that contains assets that are difficult to sell, or if there is a family dispute, it can take many years before completion. Executors are supposed to act for the interests of the beneficiaries at all times, and working speedily and efficiently.

Question

Who is entitled to see the contents of a will and how?

Answer

Once a will is admitted to probate in the Supreme Court, it is a public document and anyone can get a copy by asking the probate registry and paying a small search and copying fee (about $100).

But before it is probated, the only people entitled to see it are the executor and the beneficiaries mentioned in it.

Further, beneficiaries are only entitled to see so much of the will that refers to them, but it is more usual for an executor to release the whole will to them.

If a will is never admitted to probate (for example, there are no assets) then the will may remain private indefinitely.

Question

Can someone challenge the capacity of the will maker, and what evidence would be needed to have the will disregarded?

Answer

Yes. Loss of mental capacity is a function of getting older, and as our population ages and wills are being made later in life the risks of making an invalid will increase.

These sorts of challenges are on the rise. The test is whether the will maker fully understood what they were doing when they made the will. A doctor’s opinion is important but not determinative.

Evidence by witnesses and others such as the lawyer who drafted it are very important when a court is asked to determine if a person had capacity.

If the court finds they did not truly understand then the will is ruled invalid and the prior will takes its place.

These are hard fought and expensive claims and rely on a great deal of evidence from many people.

Nick Bruining is an independent financial adviser and a member of the Certified Independent Financial Advisers Association