Do I need a Will?
We are so happy to welcome Michael Rizzuto on board as our Senior Lawyer – Estates and Succession. This week he has been working closely with some of our entrepreneurial clients, and has written this blog for us to help you to establish whether you need a will & provide some basic information about wills in general.
What is a Will?
Most people are familiar with wills and have some understanding of what they are and how they work.
At its most basic, a will is a legal document which allows you to appoint somebody to attend to your assets and affairs and control who will benefit from your property and possessions when you die. Your will can also provide instructions and provisions for the people you love beyond matters of property.
A will most commonly includes the following:
Distribution of your property
Appointment of an executor to carry out the will
Appointment of guardian for your children
Donation to charities
Funeral arrangements
A well prepared will is both the best evidence of a deceased person’s wishes. It is also the legal document through which those wishes are put into action. Unfortunately a poorly prepared will can have the opposite effect in both respects.
The term ‘estate’ in this context refers to all the assets of a deceased person.
Why do I need a professionally prepared Will?
Everyone should have a well prepared will. Whether you have a large estate or small, if you have no assets at all but have young children, if there are insurance policies within your superannuation fund which would pay out on your death or in almost any situation having a well prepared will in place at your death makes it much easier for your loved ones to manage your affairs at what will no doubt be a very difficult time for them.
Dying without a will or with a poorly prepared will can dramatically increase the costs, delays and complications involved in administering your estate. This is often a result of ‘home-made’ wills prepared by people from ‘will kits’. While these are much cheaper than obtaining professional advice and having your will prepared by an experienced and competent lawyer it is much more likely that vague or unclear drafting or a technical deficiency of some kind will result in your estate being reduced by legal fees after your death.
Another serious outcome of dying without a will or with a poorly prepared will is that it can result in your assets being dealt with in a way you would never had approved of during your life. Legislation provides a formula for distributing assets in the event that you die without a will or with a will which does not properly deal with your assets (known as ‘intestacy’ or ‘partial intestacy’). It is very unlikely that the formula would exactly match your intentions. In fact, it might create a very unexpected result. Legislation and Court rules also set out the people who are entitled to seek to administer your assets in these circumstances (your ‘administrator’). This can also result in a very undesirable outcome in certain circumstances.
There might be other, more technical but equally important, benefits of having a well prepared will. For example, you may be able to provide for significant tax savings by directing certain assets to certain beneficiaries. This is relevant for almost anybody who has superannuation, which includes most of the working or recently retired population. A well prepared will can make this provision, or allow for the flexibility to enable your executor to access these tax benefits.
A well prepared will can also reduce the possibility or potential consequences of a claim against your estate under family provision legislation.
Quite aside from the question of your assets your will allows you to appoint guardians for your children, to express your wishes regarding your funeral and burial and to provide for many other important considerations.
Who can make a Will?
Anyone who is 18 years and older and mentally capable can make a valid will.
Some people, such as those in the early stages of dementia or with certain mental illnesses, may be partially incapacitated but still able to make a valid will. In and case where there may be some doubt in this regard the person should see a suitably qualified lawyer to have their will prepared and should also obtain the opinion of an appropriate medical professional such as a psychiatrist, psychologist or geriatrician, or, in some cases, the person’s general practitioner.
The Supreme Court has the power to approve a will made by a person under 18 years of age and to create a will for a mentally incompetent person (a ‘statutory will’).
How do I create a Will?
Legislation creates very strict requirements for creation of a valid will. For example, it must be signed by in the presence of two independent witnesses. Further, the probate court will raise queries or concerns with any will which has any appearance of not having been executed in strict compliance with the legislation. For example, the registry will usually require additional affidavits if the will was signed using different pens, if the will has been unstapled and re-stapled or if it appears that a paper-clip was attached to the Will at some time.
How long will my Will be valid?
A will remains effective from the date of its execution until it is revoked or, if not revoked, until your death. This is the case whether or not you think the terms of the will are still appropriate.
A will is revoked by making a later will, destroying the will with the intention of revoking it or, in most cases, by the will-maker marrying after the date of the will. Similarly, any gifts to a spouse are revoked by divorce (although, importantly, there is no equivalent provision for de facto couples).
You should update your will whenever there is a significant change in your family situation, such as marriage or divorce, or the birth or death of any children or grandchildren. You should also review your will whenever your assets change significantly.
Can I change my Will if I change my mind?
You can change a will as many times as you wish, as long as you are legally able to.
You can create a codicil, which is a document which allows you to make changes to your will. A codicil must also be signed and witnessed. When making changes to the will, you cannot amend it by merely crossing something out and writing your initials next to the amendment. Codicils can often create confusion and complication after you die. It is usually best to prepare a new will.
Who should I appoint as my executor?
The executor should be someone you trust as that will be the person responsible for dealing with your estate after your death. It should also be somebody who would be well suited to the job and who would be willing to do it. Being an executor can be onerous so you should discuss your wish to appoint a person as an executor before you do so.
You should always appoint substitute executors to act in the event that your executor predeceases you or is unable or unwilling to act or continue to act.
Can my will be contested?
A will can be contested on grounds of invalidity. The person who contests the will must show that:
there is another will made at a at a later date;
the will-maker was not mentally capable of making a will at the time; or
the will was made under duress or force.
A will can also be ‘contested’ by certain categories of people, mostly family members, who may claim that they were not properly provided for in the will and seek additional provision. Such claims are based on the financial position of the claimant and other affected people. Whether or not the will-maker thinks that claimant ‘deserves’ a share, or if there is some reason they did not want to make provision, may be relevant but will not usually mean that a claim cannot proceed or succeed.
What Should I Do Next?
Contact us if you would like further legal advice on creating a will or succession planning generally. Our lawyers at You Legal will be happy to assist you in whatever way we can. Even if you are just curious about the cost, send us an email and we can shoot you through our price list.
* This blog is for general guidance only. Legal advice should be sought before taking action in relation to any specific issues.