Estate planning is not something we generally think about as we
go about leading our busy lives. But what many of us fail to see is
that neglecting to carry out this process could have serious
ramifications for our families and their futures.
Having properly considered and drafted estate planning documents
in place presents a range of significant benefits for you. For
example, solid estate planning reduces the possibility of disputes
over estates, minimises the amount of tax paid by the estate's
beneficiaries and avoids unnecessary delays, expenses and
uncertainty in the distribution of the estate's assets.
Below are some cases we have witnessed when people have failed
to put the right plans in place.
Rules of Intestacy
A husband and wife own a medium sized family business. They have
four children, two sons who work for the business, who work for
less than market pay and the promise of inheriting the business,
and two daughters who do not have any ties to the family
The parents die unexpectedly and it's discovered that they
had not included the two sons as successors to their business in
the case of death in their will. The sisters now want to sell their
share of the business, with the sons having no real legal right to
contest. The sisters sell their share of the business to a third
party, meaning the business is no longer solely owned by the
family. The circumstances caused a family rift with the siblings no
longer talking and the sons left to work with the new business
partners to work out remuneration structures and corporate
A husband, wife and their son are in a car accident, the parents
don't survive and the son is left mentally disabled as a result
of the injuries he sustained. Upon the parent's death, all
assets are transferred directly to the son, with no trust in
As the assets from the will are legally gifted to the son in his
own name, the son loses his rights to Centrelink disability
benefits and his health care card.
The son is then befriended by his carer who convinces him to
transfer the assets to her to take care of and he is left with
If the parents of the son had put in place a testamentary trust,
it would have mitigated the risk of the son being left with
nothing. The assets would have been managed appropriately and
allowed the son to live as comfortable a life as his circumstances
would allow and would have also permitted him to have access to
health and Centrelink benefits.
Change of Circumstances
A man and woman had been married for 20 years. During their
marriage they had each written valid wills and put in place
enduring guardians and enduring power of attorneys, each appointing
the other as their attorney and enduring guardian. The couple
decided to legally separate and shortly after the wife fell
The couple had not amended their wills upon their separation so
the husband was still the legal enduring guardian and enduring
power of attorney of the wife. Despite no longer being married, the
estranged husband had complete control of the decisions made on
behalf of his estranged wife, including not only financial
decisions but also decisions to be made about the medical treatment
of his estranged wife.
Swaab Attorneys was the highest ranking law firm and the
13th best place to work in Australia in the 2010 Business Review
Weekly Best Places to Work Awards. The firm was a finalist in the
2010 BRW Client Choice Awards for client service and was named the
winner in the 2009 Australasian Legal Business Employer of Choice
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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There are several requirements that must be completed by an executor before the distribution of assets to beneficiaries.
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