In recent years changes to the law have greatly widened the potential for claims to be made against people’s estates and for Wills to be contested.
The amendments to Part IV of the Administration and Probate Act 1958 (“the Act”) commenced on 20 July 1998. One of the most significant changes to the legislation was to widen the categories of people eligible to make a claim for provision out of the estate of a deceased person. Such claims are commonly referred to as a Testator’s Family Maintenance claim (“TFM claim”).
The categories are no longer limited to family members and are not limited to financial dependence. Literally, “…..any person…..for whom the testator had responsibility to make provision” may make a claim, so long as the testator had a moral obligation to the claimant.
In the last few years the Courts have handed down a number of judgments that provide guidance in the interpretation and application of the amendments and, in particular, the attitude of the Courts to the various classes of persons making a TFM claim.
The Court must be satisfied that the Will “does not make adequate provisions” for the applicant and that the deceased had a “responsibility to make provision for their proper maintenance and support”.
In determining whether or not provision should be made for a particular applicant, the Court must have regard to a list of factors, including: any family or other relationship between the deceased person and the applicant, the nature of the relationship and where relevant, the length of the relationship; any obligations or responsibilities of the deceased person to the applicant, any other applicant and the beneficiaries of the estate; the size and nature of the estate of the deceased person; the financial resources (including earning capacity) and the financial needs of the applicant, of any other applicant and of any beneficiary of the estate at the time of the hearing and in the foreseeable future; and any benefits previously given by the deceased to any applicant or beneficiary.
Following is a list of decided cases which illustrates the approach adopted by the Courts in dealing with the wider catergory of potential claimants:
- Marshall v Spillane (2001) VSC 371
A younger brother succeeded in a claim against his older sister’s estate as the deceased had raised her younger brother as a “defacto son” from a young age and the younger brother had acted as a dutiful son would have done.
- Lee v Hearn (2002) VSC 208
The Court rejected a claim by a “carer” of the deceased. The two were friends but it was difficult to discern the depth of their friendship and accordingly, the Court concluded the relationship was one of friendship but no more and did not accept that the applicant was like a son to the deceased. He lived in a property owned by the deceased in Queensland for a period of about 12 years prior to her death, performing care taking and other associated functions. The deceased visited the Queensland property intermittently but otherwise resided in Melbourne.
- Armstrong v Sloan (2002) VSC 229
A claim by an estranged wife of the deceased failed as the Court found that she had already received a substantial property settlement.
- Schmidt v Watkins & Anor (2002) VSC 273
A claim by an alleged defacto partner of ten years failed as the Plaintiff failed to establish either the relationship or the financial contribution on which his case depended.
- McKenzie v Topp (2003) VSC 90
A step son succeeded in his application against the estate of his step-mother as he had returned to live with her for the five years prior to her death and had cared for her during that time.
- MacEwan-Shaw v Shaw (2003) VSC 318
The Court rejected a claim by grandchildren as it considered that in order to give rise to an obligation to make provision, there must be an unusual degree of closeness and generosity between the grandparent and grandchild, which did not exist is this case.
- Sanderon v Bradley (2004) VSC 231
A claim by the deceased’s sister was unsuccessful as she failed to establish that the deceased had a “responsibility” to provide for her.
- James v Day (2004) VSC 290
A claim by stepchildren was successful as the testator had derived her estate from their father and for that reason, the stepmother had a responsibility to provide for his children.
- Petrucci & Ors v Field (2004) VSC 425
A claim brought by the deceased’s daughter-in-law and grandchildren (the deceased’s son had predeceased him) succeeded as the Court found that, had the son survived, the deceased would have provided for him. But, since he had died the applicants lost the benefit of financial support from the son and also the benefit of the inheritance he would have received.
- Coombes v Ward (2004) VSCA 51
A claim by an adult son of the deceased who had been adopted out (but had re-established contact with his biological mother) failed as the son had not established that his mother had a “responsibility” to make provision for him.
- Keets v Marks (2005) VSC 172
A claim by a stepson of the deceased succeeded as the Court found that as the plaintiff’s mother’s had a responsibility to provide for him, that responsibility transferred itself to the deceased on the receipt by him of her money.
- Markovska v Kocevska (2005) VSC 319
A claim by an adult daughter failed as the Court was unable to conclude that the deceased had a moral obligation to make any provision for the plaintiff.
- Iwasivka v State Trustees Limited (2005) VSC 323
A claim by a niece by marriage of the deceased’s intestate estate succeeded as the deceased herself was of the view that the plaintiff should receive her benefaction and their relationship was such as to warrant recognition by the deceased.
- Sellers v Hyde(2005) VSC 382
A claim by a 73 year old defacto / foster daughter who was raised by the testator as her daughter and sole child. The plaintiff relationship with the testator became strained in about 2001 and this led to the testator’s change of attitude towards the plaintiff. However, the Court viewed this as irrational and decided that provision should be made for the plaintiff.
These cases illustrate that in amending the Act as it has, the Parliament has left it to the Court to decide on a case by case basis whether provision should be made for a particular applicant. The Court must respect freedom of testation except in those cases where that freedom has been abused by a failure by the deceased to fulfil his or her responsibility to such a claimant.
We would be happy to provide advice to you in relation to the above issues and other related wills and estates matters.
For further information, contact Renishka Naidoo-Weisse of Oldham Naidoo Lawyers via email or by calling (03) 9640 0002.
DISCLAIMER: This information is of a general nature only and is not intended to be a substitute for legal advice. It is recommended that these matters be discussed with a Lawyer.