By Nicholas Kyriakoudes
The death of a family member or loved one can be an emotionally challenging and draining time. This is particularly so where someone feels they have been unfairly omitted or not properly provided for in the testator’s will.
Whilst the law of succession reflects the notion of testamentary freedom, meaning that generally a testator is free to dispose of their assets to whomever they select, family provision claims (under chapter 3 of the Succession Act 2006 (NSW)) provides an avenue to ensure the testator cannot arbitrarily dispose of their assets without due regard for those who may be entitled or expecting to receive an inherence.
Applicants must qualify as eligible persons
Feeling unprovided for by a will does not constitute a valid basis to making a claim for a family provision order. Section 59(1) of the Succession Act 2006 (NSW) outlines the requirements that need to be satisfied before the court may consider in its discretion under s 59(2) what provision is appropriate for the “maintenance, education or advancement in life of the eligible person”.
The categories of eligible persons that may apply for family provision are listed in s 57 and include:
- The husband or wife of the deceased.
- The de facto spouse of the deceased (defined in s 21C of the Interpretation Act 1987 (NSW)) to be mean a relationship between two persons who are living together as a couple and who are not married to one another or related).
- A child of the deceased. This includes legitimate, adopted, ex-nuptial and artificially conceived children. However, a step or foster child will need to qualify under another category of eligible persons.
- A former husband or wife.
- The “miscellaneous category”: Those who:
- Were at any particular time wholly or partly dependent on the deceased, and
- Is a grandchild of the deceased or was a member of their household.
- Persons living a close personal relationship (where one or each provides the other with domestic support and person care without remuneration).
Simply because someone qualifies as an eligible applicant, that does not in itself mean their claim will be successful. An eligible applicant needs to satisfy various jurisdictional requirements.
Special jurisdictional question
For those applicants who qualify under ss 57(1)(d), (e), (f), the court must (in addition to the below requirements) be of the view that there are “factors which warrant the making of the application” under s 59(1)(b). The basis for this additional requirement is that these applicants are “not generally regarded as natural objects of testamentary recognition” (Churton v Christian 1988).
The factors which warrant the making of an application are those which give the applicant “the status of a person who would be generally regarded as a natural object of testamentary recognition by a deceased” (Re Fulop 1987). The Special jurisdictional question places an additional burden on the selected applicant to show they have a basis to make a claim on the estate of the testator.
For example, in the case of a former spouse who has been awarded property under the Family Law Act 1975 (Cth) that application may be struck out as an earlier property settlement may have adequately provided the former spouse so as to make it inequitable for the former spouse (who may have been divorced to the testator for an extended period and had nothing to do with them) to then be further provided by the estate.
General jurisdiction question
For all categories of eligible person, under s 59(1)(c) the court will consider whether “adequate provision for the proper maintenance, education or advancement in life of the” applicant has been made by the will of the testator or by the operation of the intestacy rules in relation to a person who dies without a will.
The court will consider whether both “adequate” and “proper” provision has been made for the applicant. Whether provision has been made is a question of objective fact.
Another way of putting this requirement is considering in the entirely of the circumstances, whether the testator has unfairly left out or not provided enough in their will to the applicant. For example, where a child receives nothing under a will with the estate passing to their siblings, proper and adequate provision may not have been made.
Simply because an applicant has proven they have not been adequately and properly provided for, this does not mean they will be successful in their family provisions claim. This is as the decision to make an order under s 59(2) is discretionary. Therefore, the court carefully scrutinises the circumstances of each case and will not simply make an order on the basis of relationship or expectation.
The matters which the court may consider in determining whether to make provision for an applicant is wide and varied. As each claim for family provision is unique, the emphasis placed on different factors will accordingly vary. For example, where a child who cared for their parent is destitute and receives nothing when their parent died, emphasis may be placed on the wealth of the child and the fact that they cared for their parent in awarding provision. Conversely, where a wealthy child did not have a strong relationship with their parent, the court may consider the fact that the child is able to support themself and did not have a strong bond with their parent are factors which indicate provision should not be made.
Under s 60(2) the court may consider a wide variety of non-exhaustive factors (https://www.legislation.nsw.gov.au/view/whole/html/inforce/current/act-2006-080#sec.60).
The effect of the order
If the court decides to make an order for family provision, the order takes effect as if the additional provision to the applicant was made by a codicil to the testator’s will, if they left a will, or by will if the deceased died intestate (s 72(1)). The court may provide the provision to the applicant is made by way of lump sum, periodic sum, the transfer of property, or any other manner it thinks fit under (s 65(2)).
Drafting wills with family provision in mind
Whilst many struggle with the idea that someone can challenge the dispositions and allocations of their estate made under their will by family provision orders, the occurrence of such orders does not destroy their testamentary freedom. Testators remain free to dispose of their assets however they choose. However, testators should be mindful of those who may be eligible to make a claim on their estate should they fail to be adequately and properly provided for.
A testator may wish to execute a statutory declaration after executing a new will explaining the reasons for certain dispositions in their will if they have concerns of a potential claim on their estate. Whilst such a declaration does not guarantee a claim will be unsuccessful it can be considered by the court under s 60(2) which may give weight to considerations the testator made when executing their will, particularly where the testator is not able to give evidence to the reasons for their disposition.
Please contact our team at Hansons Lawyers on 42 222 666 or by email at email@example.com who can advise you in relation to your will and family provisions claims.