Avoiding family provision claims on your Estate: things to consider when preparing your Will
Nov 22, 2019In a judgment handed down on 30 April 2019, the Court of Appeal has allowed an appeal by the adult children of a deceased man for further provision from his Estate.
The Case: Squire v Squire [2019] NSWCA 90 (30 April 2019)
The Family – In this case, the deceased had three adult children and had been, shortly before his passing, married to his spouse of approximately 10 years. The children were born of the deceased’s previous marriage. Only two of the children brought their claim before the Court.
The Will – The deceased’s Will left his entire estate to his spouse, and his children would only receive provision from the estate in the event of the spouse pre-deceasing the deceased.
The Arguments – The children claimed that the spouse and their father had separated before his passing, and he had intended to have a new Will prepared, but did not get around to instructing a solicitor before his death. They noted that the spouse had begun to systematically split all assets held with the deceased person and viewed the separation as final. The spouse, however, contended that she and the deceased had not separated and that she was entitled to the full estate in accordance with the deceased’s Will.
Initial Court decision:
The Court found in the first instance that the spouse had a superior claim to the Estate than the children, and refused to make provision for the children. This was, among other reasons, found on the basis that the spouse and the deceased had not reached a formal property settlement in respect of their separation, and also in consideration of the spouse’s aspiration to live in an unencumbered property.
The children appealed that decision.
The Appeal
The Court found that the spouse clearly viewed her separation with the deceased as being final which was evident from her endeavours to split her assets with the deceased equally while he was alive. These endeavours also meant that she had received an informal property settlement, which terminated any moral obligation that the deceased had to provide for the spouse.
In relation to the obligations to provide for a spouse, the Court reiterated that generally the position is that provision must be enough to allow the spouse to live the lifestyle to which they are accustomed. However, in this case, because of the parties’ separation, they each had to live a more modest lifestyle and therefore the Court did not need to make provision to put the spouse in a better position than she would have been if the deceased had not passed away.
The Court overturned the original judgment and found in favour of the children.
What does this mean for you when preparing your Will?
Some key takeaways from the decision are:
- If you have a significant change in circumstances, it is important that you update your will This may be a change such as the breakdown of a relationship, the beginning of a new relationship, or making a decision to make a significant gift to someone during your life time. Although the law provides that a divorce will revoke any appointment of your former spouse as your executor or trustee, and will revoke any bequest to them (unless you express some other intention in the Will), mere separation will not have this effect.
- If you do intend to exclude someone from your Will, or otherwise make limited provision it is worthwhile making a statement as to why you have made that decision to accompany your Will, or to be included in your Will;
- Seek proper legal advice at the time of preparing your Wills to ensure that you address any potential claims and take measures to protect your estate.
Contact the Shire Legal team if you have any questions.
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