Problems with Will challenges involving small estates

27 February 2012 Topics: Estate planning, Litigation and dispute resolution

Generally, an eligible person will succeed in a challenge to a Will if they have been left without adequate provision and they can demonstrate some financial need. Provision will not usually be refused except in exceptional circumstances, such as where there are minimal assets in the estate or where there has been disentitling conduct.

With the increasing number of claims against small estates, judges are quickly changing their attitude towards these applications.

In the recent NSW Supreme Court decision of Bull v Booth three adult children brought a claim for further provision against their mother’s estate. The mother’s Will appointed her second husband as her executor and left all of her estate to him. The major asset was a home valued at approximately $410,000. The estate also had liabilities of $70,000, including legal costs.

The husband was unable to work and was living on a disability pension as a result of significant health problems. He did not own any property and had assets of approximately $7,000.

All three children had varying medical conditions requiring ongoing treatment and two were unable to work due to their conditions. Two had dependent children who required ongoing medical care. Two had significant mortgages over their homes, while the third lived in government housing. All three children had a good relationship with their mother before she died.

The court found that all three children were eligible to bring a claim and had clearly been left without adequate and proper provision. However in all the circumstances, the husband’s entitlement as the spouse took priority over the children’s claims.

Taking into consideration the small size of the estate, the estate’s liabilities and the needs of the husband, the court denied any further provision to the children and dismissed their applications.

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