As Benjamin Franklin said: “…in this world, nothing is certain except death and taxes.”.
Given death’s certainty, most people die leaving a Will pursuant to which an executor (i.e. a trustee) is appointed and the estate will be administered according to the terms of the Will. Up to four executors may be named in a Will.
Most estates will include the family home. If, say, a husband dies first leaving his estate to his wife, a grant of probate may not be necessary.
For example, if the husband dies leaving his wife the whole of his estate, but it consists of a matrimonial home held on joint tenancy as between them, that home will not form part of the deceased’s estate but rather may be transferred to his surviving wife simply because of her survivorship.
There are two forms of landholding in New South Wales, they being: –
1. As joint tenants:
In this situation the survivor would, on the filing of certain documentation with NSW Land Registry Services, be able to be registered as the sole surviving joint tenant and a grant of probate would not be necessary (and indeed would not be applicable as the home would not form part of the deceased’s estate for the purpose of an application for such a grant)
The alternative method of landholding in Australia is as tenants-in-common.
Increasingly parties, for various reasons, following their purchase are registered as tenants-in-common as to shares that may not necessarily be equal. Often this is to reflect the unequal contributions made by the parties to the acquisition of the property.
If the parties’ home – in our illustration – is held by the parties as tenants in common, the surviving wife would have to seek probate of her late husband’s Will in order to have the property transferred to her.
Further, probate may not need be required if, for instance, the parties held a joint account with a bank or financial institution. The funds in that account will pass to the survivor.
Other circumstances when probate need not need to be sought:–
If the estate is very small, and the deceased dies with limited funds invested with a financial institution, then the financial institution will often transfer monies to the surviving party (from a deceased’s personal account) if the survivor can produce a Will showing that he/she is the beneficiary of those funds under the terms of the Will, and the executor gives an indemnity to the bank to repay to them those funds in the event of a claim being made against the deceased’s estate.
Dying without a will
To die without a will is to die “intestate”.
There is no statutory requirement to obtain a grant of representation in every case. Some asset holders will release modest amounts without the need for a grant being made, provided that you can establish that you are the next-of-kin.
If the deceased dies without a Will being in place (or if it cannot be found), letters of administration will have to be sought in the event that there is land (that is not held in joint tenancy) or some form of substantial asset-holding (such as with shares).
Chapter 4 of the Succession Act 2006 (NSW) sets out the order in which eligible relatives will inherit the estate of a deceased person. The disadvantage of failing to make a Will is that the estate may then have to be distributed to persons whom the deceased never intended to benefit.
There is an active duty to seek a Grant of either Probate or Letters of Administration within 6 months of the death of the deceased and if such an application is delayed, an affidavit will be required explaining the applicant’s delay.
The cost of seeking Grants of Probate or Administration is fixed by reference to certain legislation. Filing fees are also payable to the Supreme Court, depending on the gross value of the estate.
If you have recently lost a relative or loved one, speak to us about the process you need to undertake as the executor, beneficiary or as a claimant for further adjustment under the terms of the Will.