How your financial standing affects family provision claims

Published 29 Apr 2014

When making family provisions claims, it is important to understand how your current financial standing may affect your ability to contest a will.

Family provisional claims can only be made by eligible persons who the deceased had a moral obligation to help improve their financial situation. This can include children, spouses and even ex-partners.

However, if you decide to go ahead with an inheritance dispute, the Supreme Court will consider a number of factors before deciding on the outcome of the family provisional claim. This includes the size of the estate, the mental capacity of the deceased at the time he or she made the will and the financial needs of the family members.

Often, when a number of individuals decide to contest a will together, the amount each plaintiff is awarded will depend entirely on their financial standing. An example of this was seen in the New South Wales Supreme Court in early April this year.

NSW siblings contest their mother’s will

A woman decided to leave her entire estate to one of her eight adult children when she passed. This daughter was also named as a joint executor and trustee of the will, alongside her sister. Four of the deceased’s other children decided to contest their mother’s will while the remaining children made no claims on the estate.

The Supreme Court first assessed the size of the estate, finding that aside from the house (worth approximately $440,000), the estate was very small. In order to meet the plaintiffs’ claims, the property would need to be sold.

After considering the financial standing of the children making family provisional claims, the Supreme Court decided to issue separate orders for each plaintiff. This decision allowed the Court to divide the estate fairly dependent on the financial needs of each child.

In particular, the Court weighed the property ownership, employment, asset holdings and relationship of each plaintiff in its decision. For example, while one plaintiff owned his own home with a $178,000 mortgage and was unemployed, the Court decided that his joint income with his wife exceeded his weekly expenses by a significant amount.

This meant the plaintiff was not financially reliant on the deceased estate and would not be awarded a share. However, this plaintiff’s brother – a divorced, casual worker – did not own his home. Because the individual’s son had moved in to his rented flat, the Court decided to award the man the largest share of the estate to enable him to purchase a larger unit.

If you’re unsure how your finances could impact on your ability to contest a will, get in touch with a contesting wills lawyer today.

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