Gone are the days of the white picket fence, the high school sweethearts together forever and the 2.4 kids. Nowadays families are more complicated and consequently, so is Estate planning.
Most blended families that I meet have the same goals… “protect my kids and make sure they get my Estate”. Even though the most carefully considered Wills and Estate planning can be open to review by the Courts, the best chance you have of making sure your wishes are fulfilled is to ensure that they are accurately and adequately identified in your Will and any other supporting documents.
How do I ensure MY kids get my Estate?
This question is one of the most common in blended family situations. Especially where the relationship may be relatively new, or the person asking doesn’t particularly like the new partner’s children (or their ‘ex’).
I often get asked questions like “can I just leave my Estate to my kids and he/she/they can leave his/hers/theirs to his/her/their kids?” This isn’t a cut and dried guarantee of the outcome you seek. For example, if you die before your partner, they could make a claim against your Estate, despite the terms of your Will. If successful, they will get a share of your Estate, which will then become their property to use or to distribute under their own Will upon their death.
An eligible Applicant under the Succession Act 1981 (Qld) can make an application seeking provision, or further provision, from your Estate if they consider that they haven’t been adequately provided for in your Will. See information in our Family Provision Applications brochure for more information on Family Provision Applications and who is an eligible applicant.
There are things we can put into place as the best attempt to protect your wishes, such as mutual Will contracts and asset protection structures such as Trusts.
I don’t want my partner to have to leave our family home or have it sold, but I want to make sure my kids get my share of it when I am gone.
There are multiple ways to own property. Understanding how you own your property is the first step in determining whether it forms part of your Estate and can be distributed under your Will.
- Joint tenants – this means you own your property jointly with the other person. The death of the first person means it automatically belongs entirely to the survivor (upon the completion of the administration process of course). Joint assets belong to the survivor, they do not form part of the Will of the first to die and they can’t be claimed in any family provision application. They solely belong to the survivor, end of story.
- Tenants in common – means you own the property as a tenant in common in a relevant share with the other person. For example, you may own the property 50/50, 60/40 etc. Your share is your share alone and does form part of your Estate. You can gift your share under your Will, and it also forms part of your overall Estate in any family provision application. You own your share independent of the other person.
- Trusts – means the property is owned by a Trust. Depending on the type of Trust and the terms of the Trust Deed will determine whether the property forms part of your Estate and in what manner.
Let’s assume you hold your property equally as Tenants in Common or solely in your own name alone. Your property, or your share in the property, will form part of your Estate and can be gifted to your children or form part of your residue.
To protect your intention that your children ultimately benefit from the home, but without kicking the partner out or forcing a sale, you can include a life tenancy clause in your Will that allows your partner to live the rest of their life in that property, but never take ownership of your share. Keep in mind, they can still bring a family provision application, but depending on your circumstances, and theirs, a life tenancy may be adequate enough that they wouldn’t be successful.
You can also make provision in your Will for your spouse to receive income from your assets whilst ultimately ensuring they pass to your children in the end. This can be through Trusts, life insurance policies and superannuation benefits and pensions.
I don’t like my partner’s children and I don’t want them to benefit from my Estate, can I prevent that?
Isn’t there a bible verse that says something like “deny the son, do not have the father”?
Unfortunately, if you are still in a relationship with the parent when you die, then their children are considered your stepchildren pursuant to section 40 of this Act, which states that a child includes a stepchild.
Conversely, in some circumstances you will be considered as separated from a de facto spouse (not marriage), if you live separately, such as in a nursing home. This was the case in The Estate of HRA deceased [2021] QSC 29. This is based on the requirement under section 5AA(2)(b) of the Succession Act 1981 (Qld) that you must have lived together on a genuine domestic basis for a continuous period of two years prior to the date of death.
Examples of where stepchildren have been successful in making family provision applications against an Estate include Currey v Gault [2010] QSC 27 where the deceased changed her Will leaving her Estate to her niece and nephew as opposed to her stepchildren after the death of their father. Whilst she had benefited under their father’s Estate, and this was considered to a certain degree, the main reason for the success of the stepchildren were that they were not adequately provided for in her Will.
Another example is Freeman v Jacques [2005] QSC 200 where the deceased had no relationship with her seven stepchildren. Again, some part of the Estate had originated from the deceased parent, however two of the seven children were successful given their necessitous circumstances. Their circumstances were considered against the circumstances of the other five children and the named beneficiary, who were in varying degrees all better off.
A take away is that depending on circumstances and each unique situation, stepchildren can make a claim against your Estate and may be successful. It’s best that we accurately and adequately word your Will and supporting documents to best mitigate this risk.
I’ve been paying child support. Do I still have to? What if I want to?
If you are assessed to pay child support through the appropriate Child Support Scheme, and you are up to date with your payments, then your child support obligations terminate on your death. You will not be required to pay any further child support from your Estate.
If you have a child support debt or money owing, then your Estate will be expected to pay this debt or money owing before distributing any residue.
You can make provision in your Will for the ongoing maintenance and education needs of your children through Trusts or other means.
What about my superannuation
Superannuation does not automatically form part of your Estate to be distributed under your Will. You should read the brochure on Superannuation and Binding Death Nominations.
If you nominate your Legal Personal Representative, then your superannuation will form part of your Estate and will be distributed in accordance with your Will. It will also be open to any claim made against your Estate. If you want to ensure that a specific person/s receives your superannuation, you should ensure that they are listed on your Binding Death Nomination.
Important reminder that Binding Death Nominations lapse every three years and have to be renewed (unless you’re lucky enough to have a fund that offers non-lapsing options, or a self-managed superannuation fund. Further, you can only appoint a particular category of people which include your spouse, your children (including stepchildren) or your Legal Personal Representative. If you haven’t completed the relevant form accurately, or signed in the presence of the necessary witnesses, it will also be invalid and not bind the Trustee of the Superannuation Fund.
Can my ex claim against my Estate?
The simple answer is maybe!!! Helpful, aren’t we.
If you are married to your ex when you die, and you don’t have a valid Will or you die intestate (without a Will – not interstate such as over the border in New South Wales), then your ex may inherit your entire Estate or a large portion of it. This could also mean they inherit your superannuation (if you don’t have a Binding Death Nomination).
To best protect your wishes, when you separate you should change your Will as soon as possible thereafter. Just remember, if you divorce or re-marry, then you potentially void any existing Will. If you want to protect your wishes between separation and divorce, then we can put a contemplation clause in your Will to make sure your wishes remain valid even when your divorce is finalised.