When a person dies, their executor or administrator takes responsibility for managing the estate administration process. This includes collecting and protecting estate assets, paying debts and expenses, and distributing assets to beneficiaries according to the Will or the rules of intestacy.
However, the role of an executor or administrator can become more complex if someone makes a family provision claim against the estate. A family provision claim occurs when an eligible person believes they have not received adequate provision from the deceased person’s estate.
Under the Succession Act 2006 (NSW), an eligible person may ask the Court to make further provision from an estate if they can show that the deceased failed to provide adequately for their maintenance, education or advancement in life.
For assistance with estate disputes or family provision claims, our wills and estates lawyers in Byron Bay, Ballina, Lismore and Kyogle can provide advice about your rights and obligations.
What Is a Family Provision Claim?
A family provision claim allows an eligible person to challenge the distribution of an estate if they believe the deceased did not make adequate provision for them.
The claim does not challenge whether the Will is valid. Instead, it asks the Court to consider whether the deceased should have provided more for the claimant.
Family provision claims commonly arise where:
- a person believes they were unfairly excluded from a Will;
- a beneficiary believes the distribution does not reflect the deceased’s obligations;
- family circumstances changed after the Will was prepared;
- the deceased failed to update their estate planning documents.
A family provision claim can create conflict between beneficiaries and claimants. It may also increase costs and delay the final distribution of the estate.
Who Can Make a Family Provision Claim in NSW?
Only an eligible person can make a family provision claim under the Succession Act 2006 (NSW).
An eligible person may include:
- the spouse or de facto partner of the deceased at the time of death;
- a former spouse of the deceased;
- a child of the deceased;
- a grandchild who was wholly or partly dependent on the deceased;
- a person who was a member of the deceased’s household and dependent on them;
- a person who had a close personal relationship with the deceased at the time of death.
The claimant must generally file their application within 12 months from the date of death, unless the Court allows an extension due to special circumstances.
How Does the Court Decide a Family Provision Claim?
After confirming that a person is eligible to make a claim, the Court considers whether the deceased failed to provide adequate provision for that person.
The Court considers a range of factors, including:
- the claimant’s financial circumstances and needs;
- the size and value of the estate;
- the needs and circumstances of other beneficiaries;
- the relationship between the claimant and the deceased;
- any obligations the deceased had towards the claimant.
The Court also considers whether the deceased had a moral obligation to provide for the claimant based on community standards and the circumstances of the relationship.
The Role of an Executor or Administrator in a Family Provision Claim
An executor or administrator is responsible for protecting the estate and acting in the best interests of the beneficiaries.
When someone makes a family provision claim, the Legal Personal Representative (LPR) must balance several responsibilities, including:
- following the terms of the Will or intestacy rules;
- protecting estate assets;
- providing relevant information to the Court;
- considering whether settlement is in the best interests of the estate.
An executor does not need to defend every claim. If a claim has a strong chance of succeeding, resolving the matter through negotiation may help preserve estate assets and avoid unnecessary legal costs.
An experienced lawyer can help an executor assess the strength of a claim and decide whether to negotiate, settle or defend the proceedings.
Should an Executor Defend a Family Provision Claim?
If a family provision claim proceeds to Court, the executor or administrator must provide evidence about the estate and the deceased’s circumstances.
This may include information about:
- the assets and liabilities of the estate;
- the value of property and other estate assets;
- beneficiaries named in the Will;
- potential claimants;
- any property that may be treated as part of the notional estate.
The executor should generally avoid distributing estate assets while a claim remains unresolved. Distributing assets too early may create personal liability risks if the Court later makes an order for further provision.
The Court may encourage parties to participate in mediation before a hearing. Mediation provides an opportunity to resolve the dispute without the time and expense of a contested hearing.
What Is a Notional Estate?
In some circumstances, the Court can include certain property in the estate even if the deceased no longer legally owned it at the time of death.
This property is known as the notional estate.
A notional estate may include assets that the deceased transferred or dealt with before death in circumstances where the Court considers the property should be available to satisfy a family provision order.
The Court will only make a notional estate order if specific legal requirements are met and the estate does not contain enough assets to satisfy a successful claim.
How Can You Reduce the Risk of a Family Provision Claim?
Although no estate plan can completely prevent a family provision claim, careful planning can reduce the risk of disputes.
Steps that may help include:
- preparing a professionally drafted Will;
- reviewing your Will regularly after major life changes;
- considering whether eligible people may have grounds to make a claim;
- recording your reasons if you decide not to provide for an eligible person;
- obtaining legal advice about protecting your estate.
Clear estate planning can help reduce uncertainty and make your wishes easier to understand after your death.
What Should an Executor Do If an Estate Faces a Family Provision Claim?
If you are an executor or administrator dealing with a potential family provision claim, you should obtain legal advice as soon as possible.
Early advice can help you understand your obligations, protect estate assets and determine the most appropriate way to respond to the claim.
Conclusion
Executors and administrators play an important role in managing estate administration and responding to family provision claims.
A claim against an estate can create significant challenges for beneficiaries and personal representatives. Understanding your obligations and obtaining advice early can help protect the estate and resolve disputes efficiently.
If you are an executor, administrator or beneficiary involved in an estate dispute, our experienced wills and estates lawyers in Byron Bay, Ballina, Lismore and Kyogle can provide advice tailored to your circumstances.