It is of great concern to many people that their wills may be challenged after their death by somebody that they have specifically chosen to exclude from the benefit of their largesse. Will that person be able to successfully take action against your estate, despite your wish that they receive nothing?
With new succession laws being passed in South Australia in the past few weeks, the difference in approach to this question from one state to another has become more stark. Where you live in Australia is a critical factor in whether your testamentary wishes will be successfully enforced or frustrated.
Let us compare New South Wales and South Australia for instance.
New South Wales passed its Succession Act in 2006. This Act substantially amended the existing laws at that time relating to wills, inheritance claims and intestate (without a valid will) estates.
As indicated above, South Australia passed its Succession Act more recently. Whilst the South Australian legislation deals with similar matters, it has, in a number of important respects, taken a very different approach to that taken by New South Wales.
For example, South Australia has chosen to impose in its legislation a deliberate bias towards the wishes of the will maker in family provision claims, as clearly evident in the terms of section 116(2)(a), which provides that, “In determining whether to make a family provision order, the wishes of the deceased person is the primary consideration of the Court”.
Whilst, of course, this section has yet to be judicially interpreted (it has no equal in any similar legislation across Australia), it almost suggests that, except in the case of mistake or inadvertence, family provision claims must necessarily fail because they will always be contrary to the wishes of the deceased person. This, however, cannot in fact be the case, because the South Australian Succession Act specifically provides for the right of certain people to make a claim against a deceased estate if they consider that adequate provision has not been made “for their proper maintenance, education or advancement in life”. How the tension between these two apparently competing aspects of the new Act will be resolved, time will tell.
By contrast, the New South Wales legislation has no similar provision to that of section 116(2)(a). New South Wales has instead opted to give the Courts liberal powers to alter the will makers intentions. Having said this, judicial policy towards family provision in NSW oscillates between those who favour the intentions of the will maker to those who favour the beneficiaries. The Supreme Court has, in the judgements of Lindsay J, made it clear that, in the family provision jurisdiction, the Court has to give great weight to the scheme of administration of the estate being followed by the will maker where that scheme evidently balances the interests of all beneficiaries.
Adding to the bias in the new South Australian legislation is the fact that it is now harder for certain family members to qualify as family provision claimants than it was. A good example in this regard is grandchildren. Previously, grandchildren could claim as of right against the estate of a grandparent. Under the new legislation, however, a grandchild can only claim against a grandparent if the grandchild’s parents died before the deceased person or, alternatively, the grandchild was maintained wholly or partly, or was legally entitled to be maintained wholly or partly, by the grandparent “immediately before the [grandparent]’s death” (see section 115(5)).
Compare this with the New South Wales provisions with respect to grandchildren, namely that a grandchild can make a claim if they were wholly or partly dependent on their grandparent “at any particular time”.
The importance of the timing difference in these two provisions is made clear in the New South Wales case of Chisak v Presot  NSWCA 100. Whilst having no relationship at all with the deceased “immediately before the deceased person’s death”, the court found that the claimant in that case had many years previously been dependent upon the deceased (the concept of dependency was also defined widely) and she therefore qualified as a claimant (although her lack of relationship with the deceased closer to the deceased’s death was critical to the court’s finding that adequate provision has been made for the claimant out of the will). A grandchild in South Australia would not even qualify to commence an action on the same factual basis under the new legislation.
The differences do not end there. In family provision claims, New South Wales applies the concept of the “notional estate”, which allows the court to take into account not only assets owned by the deceased, but also assets within the control of the deceased during their lives, such as assets held in trusts. It should be noted, however, that resort can only be had to the notional estate where the primary estate is not adequate to meet the claim awarded by the Court.
In South Australia, however, the court can only take into account those assets disclosed in the application for probate, being assets owned directly by the deceased. A claimant in New South Wales therefore has potential access to a much wider pool of assets when making a family provision claim than their counterparts in South Australia.
It will be interesting to see how the new Succession Act is interpreted in South Australia as time goes on. One thing, however, is certain – the South Australian legislature has clearly and unambiguously pivoted towards supporting the intentions of will makers, rather than the wishes of aggrieved family members. As a result, claimants will have to think more carefully about pursuing a claim, as they will be facing a harder environment. Indeed, freeing up the courts from consideration of less meritorious family provision claims may well have been the imperative driving the change in focus of the legislation in South Australia.
In the meantime, Autonomy First’s practice will remain that, where possible, we will take careful instructions from the will maker about the logic, purpose and fairness of the will in order to enhance its defensibility. If a will maker is concerned about their will being challenged, further action to entrench or defend the will may be warranted.