No Will? Why not refer it to NSW Trustee and Guardian?

NSW Trustee and Guardian  has nearly 100 years of experience in the administration of estates. As part of our independent and reliable trustee services, we currently administer around 2,000 estates a year. We also administer estates when someone else is appointed executor but asks the NSW Trustee and Guardian to take over their role, or where someone dies without a valid Will (Intestate).

As the largest administrator of intestate estates in NSW we find that individuals and legal practitioners often seek to refer intestacies to us, as our administration processes are well practised and efficient. It is important that intestate estates are administered by professionals who are well versed in these changes and know what they are doing.

For those estates where family members are widely scattered or are not close our genealogy section is highly successful in tracing relatives and has tracked down over 400 beneficiaries in the past year.

If you are interested in referring an intestacy matter to NSW Trustee and Guardian please complete our Intestacy Referral Form.

Intestacy – Frequently Asked Questions

What if I die without a Will?

If you die without a Will you are said to die intestate. The word “intestate” is derived from the Latin word “intestatus” meaning a person who dies without a Will. If you die with a fully valid Will you are said to die testate.

Intestacy may occur not only where a person fails to make a Will but also for other reasons such as:

  • the Will fails to properly dispose of all their assets
  • the Will is not valid because it has not been signed and witnessed according to the law
  • the person did not have mental capacity to make a Will
  • the Will has been poorly drafted and the legal rules of construction have not been followed.

Sometimes a person may die partly testate and partly intestate. This occurs where part of the Will is valid but part is invalid. This may result in even more inconvenience, delay and expense than administering a full intestate estate.

How is an intestate estate dealt with?

Looking after intestate matters can be complicated. Firstly a suitable administrator must be appointed by the Supreme Court of NSW. This may not be the person who you would have chosen if a Will was made. The administrator’s duties involve arranging the funeral, collecting assets, and distributing them after paying any debts and taxes. The administrator must establish the family tree using certificate evidence which may be an expensive and time-consuming task depending on who are the next of kin or if they live overseas.

Additional problems may arise where the child is a minor or incapable person as your next of kin. Here the Court may require the administrator to obtain an administration bond. An administration bond is a guarantee by a third party, often an insurance company, to make good any loss should the appointed administrator fail to properly administer the estate. The bond is usually equal to the value of the estate being administered.

The law exempts the NSW Trustee and Guardian when acting as an administrator of an intestate estate from having to obtain an administration bond.

If I don’t have a Will who inherits my assets?

Your assets will be distributed according to a pre-determined formula with certain family members receiving a defined percentage of your assets despite what you may have wished.

Legislation is enacted in each state and territory of Australia defining who are a person’s next of kin and what portion of the estate they inherit. The legislation of each state and territory is slightly different.

On 1 March 2010 historic changes to the NSW laws of intestacy took effect. The new laws will apply to the distribution of estates of all those people who die without a valid Will on or after 1 March 2010. 

30 day survivorship – to receive a benefit in an intestate estate a relative must survive the intestate by 30 days – previously there was no such rule and to inherit a relative had only to survive the intestate.

Spouse means: 

  • A married person or
  • a domestic partner - domestic partner replaces the term “de facto spouse”.  Domestic partner means a de facto partnership of at least 2 years or one that has resulted in the birth of a child.  A domestic partner may be someone of the same or opposite sex.

Multiple spouses means any combination of a married person and/or domestic partner or partners of the same or opposite sex.

Issue means a person's children or other lineal descendants such as grandchildren and great-grandchildren. While a child or children are alive, issue refers only to them, but if they are deceased then it will apply to the next generation and so on down the bloodline.

 Distribution under the new laws:
Spouse/s no issue

  • If a person dies leaving a spouse or spouses (includes domestic partner/s) and no issue – the spouse or spouses inherit the whole intestate estate.

Spouse/s and issue of spouse/s

  • If a person dies intestate leaving a spouse or spouses as well as any issue of the one or more spouse/s then the spouse/s inherit the whole intestate estate,

Spouse/s and issue of another relationship

  • However if there are children of another relationship other than the spouse/s (remember spouse/s includes domestic partner/s) – e.g. issue of an ex-spouse or ex-domestic partner - the estate is divided according to a formula between the spouse/s and issue (this may also include children of the intestate and current spouse/s as well as children of the ex-spouse or ex domestic partner) as follows:
    1. one spouse receives or spouses share between them:
      • a legacy of $350,000 as adjusted by the Consumer Price Index in accordance with a formula set out in the intestacy laws – under the previous intestacy laws the legacy was $200,000 and only one spouse or one de facto spouse was entitled 
      • the intestate’s personal effects
      • one-half of the remainder of the intestate’s estate
    2. all children including those of the other relationship as well as children of the spouse/s receive remaining part of the estate.

Sharing between multiple spouses

Where multiple spouses survive the intestate their entitlement is shared:

  • in accordance with a written agreement they make between themselves and submit to the administrator of the estate or
  • in accordance with an order of the Supreme Court or
  • equally between them.

Single spouse’s right to acquire any property

Also new is the spouse's right (where there is one spouse) to acquire any of the property that belonged to the deceased. The purchase price paid for the property is firstly paid from the spouse’s entitlement in the intestate estate and if insufficient then from his/her own resources.  The spouse may acquire any real estate or personal estate such as a car, boat or shares. Under the previouis the spouse's right (where there is one spouse) to acquire any of the property that belonged to the deceased. The purchase price paid for the property is firstly paid from the spouse’s entitlement in the intestate estate and if insufficient then from his/her own resourcesis the spouse's right (where there is one spouse) to acquire any of the property that belonged to the deceased. The purchase price paid for the property is firstly paid from the spouse’s entitlement in the intestate estate and if insufficient then from his/her own resources intestacy laws the spouse or de facto partner could elect only to take the shared home.

Issue only survive – issue means children through all degrees e.g. children, grandchildren, great grandchildren and so on

Where the intestate leaves no spouse only issue, the issue are entitled and their share will depend on the proximity of their family relationship. So if the intestate is survived by a child or children the children will all share in the estate equally. If any of the intestate’s children predeceased, leaving children of their own (grandchildren), those children will share the portion of the estate that their parent would have received. In this way, children of grandchildren may also share in the estate if their parent predeceased. This will continue down the generations until there are no further issue. 

Common examples of how this will apply are as follows:

  • If there is one surviving child he/she will receive the whole estate.
  • If there are 2 surviving children they will share the estate half each.
  • If there is 1 surviving child and 1 child who has predeceased leaving no children of their own, the 1 surviving child will receive the whole estate.
  • If there is 1 surviving child and 1 child who has predeceased leaving children of their own, then:

-the surviving child receives half the estate;

-the children of the predeceased child will share half the estate. If any of those grandchildren had themselves predeceased leaving issue then their children will share what would have gone to their parent.

Other Relatives

If the intestate dies without a spouse/s or issue then the distribution pattern is similar to previous intestacy regime i.e.

  • parents,
  • siblings (there is no longer a distinction between siblings of the whole and half blood), if one or more of the siblings has died then their share will pass to their issue,
  • grandparents,
  • aunts and uncles (there is no longer a distinction between whole and half blood)
  • first cousins (cousins were previously not entitled).

For the purposes of the new intestacy provisions an indigenous person is one who:

  • is of Aboriginal or Torres Strait Islander descent, and
  • identifies as an Aboriginal or Torres Strait Islander descent, and
  • is accepted as such by an Aboriginal or Torres Strait Islander community.

The categories of petitioners to the Crown for waiver of its right to the intestate’s estate have been expanded:

  • dependents of the intestate
  • any persons who have a just or moral claim on the intestate
  • any organisation or person who whom the intestate might reasonably be expected to have made provision
  • the trustees of any person or organisation above

It is expected that if an intestate had a connection to a charity, for example, did volunteer work or made regular donations, the charity would be able to petition the State Government for the whole or part of the intestate’s estate.

It is expected that if an intestate had a connection to a charity, for example, did volunteer work or made regular donations, the charity would be able to petition the State Government for the whole or part of the intestate’s estate.

If you have friends or charities or a pet to whom you would like to leave a gift then you need to have this set out in a Will.  You cannot rely on the laws of intestacy to provide.

Making a Will is also important for those people who, because of cultural or religious reasons, would not wish the above formula to apply to their estates.

The laws of intestacy are a fail-safe only and may not be adequate to cover everyone, including family and loved ones.  You can see why a Will is such an important document.

 The new intestate laws also make provision for distribution of estates of indigenous people based on indigenous laws and customs.

 

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