Is your children’s inheritance protected if you die before your spouse?17 May 2019 Topics: Estate planning
It is common for spouses to make mirror Wills to provide for each other and their children when they die. Often they gift their entire estate to each other, and if they do not survive each other, then to their children. This means that the survivor receives everything if one of them dies, and when the second person dies, the children of the relationship share equally in whatever is left of their parents’ joint estate.
However, unless special arrangements are put in place, the survivor is free to change their Will after their spouse dies and may not choose to leave the estate to the children. This can happen if the survivor enters a new relationship or remarries, and that is exactly what happened in the Queensland case of Haggarty v Wood  QSC 327
In this case, the deceased and his first wife signed mirror Wills in May 1991, leaving their entire estate to each other and if they did not survive each other, then equally to their son and daughter.
The deceased’s wife died in 1997 and he received her entire estate. The deceased then entered a new relationship in 2002 and made new Wills in 2004, 2006, 2008 and 2010. The end result was the deceased’s new spouse would receive his entire estate and his children would receive nothing.
After the deceased died, his son started proceedings. First, he claimed that his father was unduly influenced to change his Will by the new spouse and second, or in the alternative, he sought a declaration from the Court to enforce a contract between his mother and father to gift their estate in a particular way, which was documented by the 1991 Wills.
At a hearing of the matter, the Court struck out the son’s claim. The judge determined that there was insufficient evidence to support a claim for undue influence and that there was no agreement between the deceased and his first wife not to revoke or change their Wills. Therefore, the son’s claim was bound to fail. The son was also ordered to pay the new spouse’s costs of the proceedings.
This means that the new spouse received the deceased’s entire estate and the children received nothing. When the new spouse dies, her Will determines where the assets will go, with no guarantee that they will go to the deceased’s children.
The only other avenues open to the children in this case are to make a claim for provision against the estate of their father or against the estate of the new spouse (as their step-mother) when she dies. However, there are strict requirements in relation to timing and eligibility to bring a claim and the process can be very lengthy and costly. So, in many cases, a person’s personal circumstances will mean they have little chance of success, with the added likelihood of being responsible to pay everyone’s costs if they are not successful. Therefore, it may not be advisable for potential applicants to bring a claim.
There are specific estate planning tools that can be used to avoid this situation and ensure the protection of your inheritance for your children, including contracts to make mutual Wills and testamentary trusts. If they had been used in this case, this dispute may have been avoided.
For more information or advice in relation to your estate planning or challenging a Will, contact a member of our Wills and Estates team today.