Inheritance and Wills Advice Sought

Hi All,

I am asking this for a friend. (….really, as I am an only child and my parents have long passed).

My best mate who I have been friends with since we were kids, has an older brother that has always been 'absent'. Mental issues, alcohol abuse (probably drugs, and who knows what else).

His older brother left home before he was 18, I think my mate was 13 at the time, and basically, he (my mate) has been the true support to his mother who now would be in her 70's (his father has passed away). She relies heavily on him for so many things, maintenance of her house, health appointments etc etc. I haven't said this to him, but I think without his help, she would have passed away years ago.

Anyhow, I understand that the above information has no relevance to my question but just wanted to provide some background.

You have probably guessed my question - what needs to be done so that my mate gets the fair share of his inheritance when the time comes and his mother passes away.

See a lawyer and don't post a question like this here would be the sensible answer, and I would normally agree with this.

He has seen a lawyer, and gotten a will done up. From what I have been able to gather (we are good mates, but it still feels uncomfortable discussing matters like this with him), the solicitor has basically just followed a set procedure, doing up a will that has been spilt evenly between both brothers, and saying that is the only thing that can be done (otherwise it will be later contested).

I can actually see the solicitor's point of view, but there must be something else that can be done.

And yes, you care for an elderly parent because you choose too, not for reward.

I was listening to some discussion on talk back radio recently, and heard that when the will is being executed after the funeral, a recipient who has been allocated an equal share can put forward a case that they are in financial distress and argue that they should get a greater share (I actually was not aware of this, and immediately thought of my mate when I heard this).

This can almost become an act of ransom (I don't know what the legal term for this is), as while this is going back and forth between lawyers, the lump sum is shrinking, and we probably aren't talking about much of a lump sum as it is a small run-down fibro unit.

Any experienced suggestions welcome.

He is such a nice guy and human being, I can't help but worry what may happen when the time comes, even though I don't think he has really given it much thought.

My parents passed away 7 years apart, and it was expected as they were quite old. Despite this it was a very sad and lingering experience - I can only imagine how much worse it would have been if there were then legal proceedings around the will.

Comments

  • +29

    Any experienced suggestions welcome.

    Give the inheritance before the will is needed is pretty much the only way… Otherwise anything can be challenged

    • Sounds like good advice, but if the value is in his mother's dwelling, that is not going to be possible.

      • +2

        Talk to an experienced accountant first, not a lawyer…

      • +1

        Why not?

      • -1

        The mother could get a reverse mortgage on the house so that her son and herself could have some extra comfort while she is alive of so that she could gift him some extra money.

        The "financial distress" thing works both ways. eg: My wife has left me about 10% of her assets and the rest goes "elsewhere" (sisters, charities, arts groups). It sounds unfair but if she died tmw there's no point contesting it because I have my own house and sufficient personal income to live a comfortable lifestyle.

        What the lawyer has done is set things up so that the delinquent brother can't contest the outcome.

        • +1

          What the lawyer has done is set things up so that the delinquent brother can't contest the outcome.

          Don't count on it. It can still be disputed, forced to arbitration; and if not resolved, to civil court. No will is bullet proof.

    • +3

      Yes, to the above. i challenged my father's will becuase out of an inheritance he of $2m he provided my mother , myself and my brother 10k each. He gave it away to the church. the executor was the priest. So we challenged, and got somewhat of a fare share. the church did get more than half.

  • +7

    See another lawyer, but they will have no sure fire way to prevent a will being contested.
    The real answer is probably for Mum to gift him his share while she is alive and of sound mind, though it may attract some tax downsides.

  • +5

    Isn't this about his mother's will? Or you're saying he engaged a solicitor to draft his mother's will? That won't end well…
    Have you negged me for misunderstanding your post?

  • +8

    See a more experienced lawyer. As this mother can gift a dwelling to a son and include a provision in the deed of gift that grants her the right of residence, allowing her to live there rent-free until her passing

    • +1

      That's a good strategy.

      Centrelink won't count the house as a 'gift' so it won't affect her Age Pension.

      • Heard of Granny Flat Interests?

        • That's a good point- I shouldn't have assumed the value of the house.

          • @JimB: No known genius hacks to evade Centrelink; except sham divorce which doesn't apply here

  • +3

    Sibling inheritance is hard man. I sympathise with your friend being the main support which I can imagine is leading you to think he deserves the greater share of the inheritance. However, as jv has said, all can be challenged at the end unless the inheritance is given out earlier. I think even a Will doesn't quite give 100% protection.

    Putting weight on personal contribution aside, I would assume my inheritance (if any) would be shared equally across my siblings. Everyone has their life and priorities. Just because i'm there more for my parents, IMO, doesnt entitle me more to the inheritance. I love my siblings just the same.

  • +10

    The real trouble comes if mum doesn't agree that one son is golden and feels her assets should be split another way.
    If this was mum asking for the help, that is one thing. But it seems like OP is someone outside the family suggesting to one of the sons they should deserve more.

    • +3

      OP is someone outside the family suggesting to one of the sons they should deserve more.

      hit the nail on the head

      OP should mind their own business tbh

  • +7

    the solicitor has basically just followed a set procedure

    So is the even split what the mother wants or not? Throughout your post you don't mention anything about what your friend's mother wants - rather that you are primarily concerned about your friend getting a "fair" (in your opinion) share. Perhaps it is she that wants everything to be split evently?

  • +8

    The opening post doesn't contain what the Mother actually wants.

    If she wants 50/50 then that is what has been written and will take effect.

    If she wants 90 Good Son / 10 Drunk Son, then I would suggest getting a second opinion.

    I have seen uneven estates go fine.

    One of the key things is if there is an 'unexpected' or 'uneven' split is communication.

    Sit the drunk MF down and say I am giving Good Son 90% because X, Y, Z. This removes the surprise element, and then accusations that :
    - She is not of sound mind.
    - She is being controlled by Good son.

  • +9

    We have two daughters who have always been close to me.

    There is a son who has not contacted us for 15+ years and only did so to ask for money.

    Our lawyer (find one who specialises in this stuff) helped me to put together a document explaining all the reasons why he should not be entitled to anything from our estate.

    I took that to another lawyer (not doubting the first guy, but it's a fair bit of money) and he agreed 100% that the first lawyer had nailed it.

    We then appointed one of our daughters and the lawyer as executors (the other daughter lives overseas and trusts her sister completely) and believe that we have kept him out as much as possible.

    We split our estate 5/50 between the girls, and they both have copies of our wills.

    Good luck

    • +5

      Hope that last typo didn't make it into the official document!

      • Well spotted!

    • My parents have done something similar.

      Also, they plan to change the estate to me prior to death and become tenants. Variety of reasons but this is one of them

      • Look up claw back laws in your state - assets distributed prior to death can be rolled back into an estate for distribution.

        • SA just abolished claw back in the new Act

          • @Benoffie: If this is the case, there may be a sudden migrant flow into SA of palliative care patients who wish to avoid the arbitrary and often unfair execution of estates from onerous family law courts around Australia.

            • +1

              @gyrex: I can tell you it's been one of the changes we were waiting on. If Inheritance taxes get back up in Australia, passing on estates prior to death with little to no penalty will be a big issue

      • +1

        Also, they plan to change the estate to me prior to death

        Must be nice to be able to plan your time of death so well.

        May be worth having a better plan that takes into account sudden/unexpected death (which seems to happen to quite a few people apparently).

        • That's a given but if one works off 80 and parents are in final home by 60, having asset changes and Trust mechanisms can remove many obstacles

  • Talk to a lawyer about the mother entering into a contract to sell the property to the younger son with settlement not due to her death

  • +4

    Having been through a very messy situation in my family, my learnings were

    • The will is not worth much and the wishes of the deceased can easily be contested and overridden for a range of reasons (in our case the will was challenged by an estranged ex partner who was only with him for a short time but ended up with a big payout, even though the deceased had made it quite clear he didn't want to leave her anything). The only ones who end up happy are the lawyers
    • It is far better for the person to divide up and distribute what they can (or put it in a trust for each child) before they die to avoid this
    • -2

      If people can do this, it’s best to put your wealth into super as not only is it currently the most tax effective proposition, but the distribution of funds within the superfund cannot be challenged. By law, it can only be distributed to the beneficiaries named

      • +2

        That is wrong. I myself was nominated as sole beneficiary of a super fund but, as we had broken up months before he died, the funds were given to his sister (who he hated) instead.

        • -2

          Your outcome would be in the less than 1% case. It’s only in extremely exceptional circumstances

  • +1

    The solicitor is lazy but it is state dependent. Being in NSW, you need local advice.

    SA just updated its laws to prevent this exact scenario

    https://lsc.sa.gov.au/cb_pages/news/ChangestoWillsandEstates…

    https://lsc.sa.gov.au/cb_pages/TheNewSuccessionActFactsheet.…

  • +1

    Solicitors draft wills on the clients advice. They don't waste their time making wills the client won't pay for. The mother must want an equal split.

  • -5

    The bottom line is that a will is not a legally binding document. It merely provides the court with an idea of what you would like to happen to your assets should probate be difficult or someone contests the contents.

    It doesn't matter how great your solicitor is, he cannot circumvent the law. Presumably a great solicitor does know the law and the best ways to achieve your goals if they're legally possible and within the legislation.

    Each state/territory has their own succession Law legislation. Often enough, they are called The Succession Act. This may vary depending on where you live.

    All succession acts pass assets from dead spouse to live spouse.

    Live spouse
    All children
    All grandchildren
    Etc

    Generally speaking, you cannot leave a gift to one member of a class and not to the others.

    So if mum has 3 children, succession law says all three children get equal amounts.

    *note that in some states ANY child who has EVER been your dependent at any time in your lives (such as foster child, step child, random ringin) has an EQUAL claim on your estate as your natural children.

    Mum could provide less for one child by saying something like "I'm giving John $200,000 and Jo $20,000 because I have already gifted Jo $180,000 to buy a house in xxxx and I have not made a similar gift to John".

    Of course, mum could completely jump over the kids and leave the bulk of her estate to the grandkids. Perfectly legal as long as she leaves to all grandchildren equally.

    Similarly if she leaves money to nieces/nephews. Must leave to all members of the class if you include one.

    Even the greatest will can be contested. But that doesn't mean they will win.

    Ultimately, the court has to follow the Succession Laws, not even he can colour outside the lines.

    • +1

      Most of this is wrong. Probably all of it.

      A will is a legally binding document unless it is inconsistent with the law. The law says nothing at all about inheritances needing to be 'equal'. Intestacy law does say this but that is a completely different situation. The right to challenge a will requires showing matters such as dependency or financial need and the court may well say anything from 'you dont need the money so you get nothing' or 'you should get xx%'.

      As others have said, if its unequal then providing the basis for it being unequal is very useful.

      You cant stop someone challenging a will. You cant stop someone suing you. All you can do is make the chances of that other person succeeding much lower

      • +1

        Some of Muppet's examples are extreme for effect but there are some truth to it.

        Almost 100% certain that a will trying to cut out one offspring from inheritance can be contested and in most circumstances that said offspring will get something. It doesn't have to be equal but will get something.

        • Almost 100% certain that a will trying to cut out one offspring from inheritance can be contested

          Anything can be contested, even if one person already gets 99% they can contest for that extra 1%.

    • +1

      This is why you don't get legal advice from the internet. Pretty much all of this is incorrect.

  • The ultimate goal is to write a will that no one will contest because the estate pays for this and they can drag it out until the entire estate has been exhausted and there is nothing left to distribute to anybody.

    Engaging a Wills and Estate Lawyer will be the best money any testator can spend.

    Also remember, super and other binding nominations cannot form part of a will and must be distributed separately according to their contractual terms.

  • Oh yeah, if you put your funeral arrangements in the will, tell someone else about them too. It often happens that the will isn't read until after the funeral and once they've burnt you, there's no do overs.

  • He has seen a lawyer, and gotten a will done up. From what I have been able to gather (we are good mates, but it still feels uncomfortable discussing matters like this with him), the solicitor has basically just followed a set procedure, doing up a will that has been spilt evenly between both brothers, and saying that is the only thing that can be done (otherwise it will be later contested).

    I can actually see the solicitor's point of view, but there must be something else that can be done.

    Solicitor is not correct.

    For starters, you can distribute assets via your will any way you want.

    The next point is that any will (whether 50/50 or otherwise) can be challenged for all sorts of reasons. In and of itself, making it 50/50 does nothing to prevent it being contested.

    IANAL, but to the extent there is the genuine potential for a challenge to the will, it would be prudent for the testator to document as thoroughly as possibly, with the assistance of a solicitor, the rationale for why they have written their will in the form they have. Should it then be challenged, a court would be able to consider not only the arguments/evidence of the estate's named or potential beneficiaries, but also the state of mind of the person making the bequeaths in the way they have.

  • +2

    Tell your friend that they need to see a solicitor who specialises in estate law or family planning. Without knowing the details, it sounds like they've engaged a garden variety solicitor who has provided some less than stellar advice. I agree with @Seraphin7 above.

    Also, those who are advising to distribute assets prior to death probably aren't aware that many states have claw back provisions within their relavent state legislation meaning that any assets distributed can be drawn back into the asset pool of the estate. Your friend should get some advice from a specialist family law solicitor and don't cheap out on it - paying a little more now could save him much more later.

  • +4

    Geeze there's a lot of misinformation and half truths in this thread. There are some good points which I will reinforce here:

    1. Each state is similar but different, sometimes in crucial ways.
    2. Subject to her wishes, your friend's mother should see a lawyer that specialises in Wills and Estates for this sort of thing. It will likely cost more than the lawyer that she saw the first time.
    3. Yes a will can be contested, but things can be done to make it harder, sometimes a lot harder, depending on how far your mother wants to go.

    And yes, I am a lawyer. Yes, one that works substantially in Wills & Estates. No, I'm not going to give anyone legal advice on an online forum.

    • Subject to her wishes, your friend's mother should see a lawyer that specialises in Wills and Estates for this sort of thing. It will likely cost more than the lawyer that she saw the first time.

      the funny thing is, she never met with the lawyer, OP's mate/her son did!

  • Something unsavoury about this "friend". The mother seems to be absent in the making of her will - "He has seen a lawyer, and gotten a will done up."

    What does the mother want? "Fair share" - an equal split is fair. If he wants more he should ask his mother.

  • +2

    In NSW, contesting an estate is commonly referred to as a “Family Provision Application”. An “eligible person” to make a claim must have been financially dependent on the deceased at some point during their lifetime (i.e., spouse or children). If a person is eligible, they need to demonstrate they have financial need that exceeds what they will receive as their inheritance. The final step for the Court is to determine if there are additional factors that should be considered (e.g., if there has been an estrangement and who caused the estrangement - see section 60 of the Succession Act for the full list of considerations). There is no way to prevent someone who is eligible from making a claim.

    In NSW, we have “Notional Estate”, which allows the Court to call back any assets a deceased gifted for less than market value within the last three years of their life, in order to pay out a claim. Assets that are commonly called back include real estate held as joint tenants (which would ordinarily bypass the Will and go straight to the surviving owner, by right of survivorship, and superannuation). So, transferring the house during the mum’s lifetime would not, by itself, protect it from being available to pay out a claim.

    As someone else has suggested, one possible solution would be for the mum to enter into a Granny Flat Agreement with your friend, which would transfer the house to the son and, in return, the son is required to provide the mum with accommodation and care services for the remainder of her life. The right to receive accommodation and care is considered fair market value, which would protect it from claims and also avoid it being considered as a gift that would result in the mum losing her pension entitlement. Stamp duty would still apply on the transfer and, if the son is not living there, he would likely need to pay capital gains tax on its sale.

    The final thing the mum can do is prepare a Section 100 Statement (named after Section 100 of the Succession Act), explaining her reasoning for preparing the Will the way she did (i.e., to assist the Court in understanding how she carefully considered who she should leave her estate to, before making a decision on what was fair).

    Ultimately, it comes down to what the mum wants to do. If she wants to leave the estate 50/50, it doesn’t matter if your friend does not think it is fair, as it is her right to leave her assets however she wishes. If she does want to change her Will (or look at any of the other options), your friend should not be involved as that might lead to accusations of coercion or undue influence. As others have suggested, if the mum is not happy with the 50/50 split, she should seek advice from a solicitor experienced in estate planning and administration.

    • The final thing the mum can do is prepare a Section 100 Statement (named after Section 100 of the Succession Act), explaining her reasoning for preparing the Will the way she did (i.e., to assist the Court in understanding how she carefully considered who she should leave her estate to, before making a decision on what was fair).

      my step father did that, the court completely ignored it, they even ignored the fact his absent son was challenging the will after the probate time had expired (by nearly a year). The only thing the Court took into account was that his delinquent absent son that had taken hundreds of thousands over the years prior to his death was broke again so needed a cut of the estate.

      It taught my mother dont rely on the courts to do the right thing. So when my grandmother was getting towards the end they researched to make sure my grandmothers wishes couldn't be left in the hands of incompetent courts.

  • For my grandmother my Mother was basically the only carer for he for the last decade or so of her life, her sister had maybe visited once every 5 years for an hour. what my Grandmother did was transfer her apartment and assets into my mothers name long long before she died (maybe 10 years or so) so that they would not be part of the estate then if the other sister challenged anything it would be a much reduced set of assets to challenge as just her share portfolio (which she also left exclusively to my mother). fortunately nothing was challenged.

    Important to remember though, it is not up to what you or your mate thinks his fair, it is up to what his mother thinks wants.

Login or Join to leave a comment