You may be surprised to learn that it is very hard to completely write certain family members out of your will under New Zealand law. Testamentary freedom is not what people think it is.
Losing and grieving a loved one is never easy. The process of moving on can be complicated further when the estate of your loved one (and, in particular, the terms of their will) is the cause of conflict.
These conflicts can arise between anyone – siblings, step-parents, aunts and uncles, grandchildren, and even non-family members. Often, these challenges occur even if a valid will is in place.
There are several grounds on which an estate can be contested, but the key ones are:
- Under relationship property law (Property (Relationships) Act) a surviving spouse or partner can apply for a division of relationship property if they are not satisfied with what they have been left under the will.
- The Family Protection Act allows certain family members who have not been adequately provided for under a will to seek further provision from an estate.
- The Law Reform (Testamentary Promises) Act provides a mechanism for people to seek provision from an estate if the deceased promised to reward them from their estate for a service undertaken while they were alive, but failed to record this in their will.
- Breach of fiduciary duty. This is a new and developing area of law in this area, which may apply where there has been a history of abuse between the parent and a child, and the parent (who must be the instigator of the abuse) has transferred all of his assets subsequently to a trust (or similar) prior to their death with the intention of disinheriting the child abused. As is clear from the summary, a claim of this nature will only arise in very limited circumstances.
Questions on the validity of a will can also include testamentary capacity issues, incorrectly signed or witnessed documents, or draft documents that nevertheless represent the deceased’s testamentary intentions. It is also possible to challenge how an executor or administrator has administered an estate, and whether they have acted in accordance with their legal obligations.
It’s essential that you seek early advice when challenging a will or estate. There are time limits to consider and several ways to settle these issues without recourse to court proceedings.
Partner claims on an estate: Relationship property law
A spouse or de-facto partner of the deceased may make a claim under this Act – sometimes more than one at once. The effect of a successful relationship property claim is that the surviving spouse’s share of the property comes out of the estate completely, leaving less to be divided between the beneficiaries of the will.
If the claimant had been in a de facto relationship with the deceased for three years or more, the general rule is that they are entitled to an equal share of all relationship property – with special carve-outs for the family home (the main house the claimant and the deceased lived in together) and the family chattels (anything from household furniture to pets and vehicles).
On the death of the spouse or partner, the claimant may decide to take up their entitlements based on a will left by the deceased or make a separate claim under the Property (Relationship) Act. There is a time limit on making this election, so it is important you have a chat with a lawyer as soon as possible.
This also cuts both ways – it is possible the executors of an estate can make a claim against the surviving partner to bring further assets into the estate under relationship property laws. However, the focus of relationship property laws is on protecting the surviving spouse, so executors have to ask the court’s permission before they can bring a claim.
Family member claims: the Family Protection Act
This Act provides a basis for a claim if a family member feels the deceased has inadequately provided for them in their will. Notably, family members include spouses and partners and children (including adopted children but not whāngai).
Parents, grandchildren and stepchildren can also make a claim – but only if the deceased was looking after them immediately before their death. A common one we have seen is where a parent dies and a grandparent steps in to look after the child.
If provision for the proper maintenance and support of the applicant family member hasn’t bene made from the estate under the deceased’s will (or the rules of intestacy if they do not have a will), the court has the discretion to order provision.
The phrase ‘proper maintenance and support’ has a specific legal meaning. It obviously includes financial support, but can also include recognition of belonging to a family and of having been an important part of the overall life of the deceased. Tikanga Māori can also be relevant. Fundamentally, the court will look at the circumstances of your family when exercising its discretion.
As with a relationship property claim, there are time limits to bringing a claim under the Family Protection Act. You must file your claim in the Family Court within 12 months of probate being granted (or letters of administration). But if the executor has not been notified of any claims before six months have elapsed following probate, the executor may start distributing assets leaving a claimant with nothing to claim against.
It is almost impossible to cut your children out of your estate
It is almost impossible to completely write your son or daughter out of your estate. A child’s conduct has to have been pretty extreme for a Family Protection Act claim to be completely unsuccessful – defrauding or murdering the deceased party being some of the more serious examples. That said, the courts are often unwilling to disturb the terms of a will if it can be avoided.
‘But they promised me I could have that’: Testamentary promises
The Law Reform (Testamentary Promises) Act provides an avenue to make a claim for a testamentary promise. A testamentary promise is a promise from one person to another to provide recognition for services rendered to them during their lifetime. Services might include anything carried out above and beyond the reasonable obligations expected of a loved one.
Examples of services that have been the subject of successful claims include:
- Financial assistance
- Assistance with managing properties or businesses
- Support and companionship (including as a surrogate family)
- It can even include a promise not to make a claim against an estate (say, for example, where one parent dies well before the other)
The claimant is not required to be related to the deceased – anybody can make a claim under the Act, including spouses, partners, ex-partners, children, stepchildren other family members or non-family members. Indeed, we have had files in the past where an entire family has been successful in making a claim against an unrelated person’s estate.
However, the claimant needs to prove:
- They rendered services to, or performed work for, the deceased in the deceased’s lifetime
- There was a promise by the deceased to reward the claimant
- A link between the services and the promise
- The deceased failed to make the promised testamentary provision or otherwise reward the claimant
The promise for compensation can be expressed or implied, verbal or in writing, although the onus is on the claimant to prove it was made, so the more evidence you have the better. The court will consider all facts in the case when making a decision.
For more information
Don’t hesitate to get in touch with our family lawyers if you want further information or advice.
Additional information can be found here:
- Family Law
- Challenging a Will on the basis of a Testamentary Promise
- Family Protection Act Claims
- Upholding an Invalid Will
Article originally published on Informed Investor.