If a deceased person's estate is challenged in New South
Wales, the court can have access to assets that do not ordinarily
form part of a deceased estate to make an award to the person
challenging the estate.
This is known as the 'notional estate' principle, which
operates to include (among other things) any property belonging to
the deceased that changed ownership in the three years before their
death. It was specifically developed in New South Wales to prevent
people hindering estate challenges by transferring property to
other people or entities before they die.
The New South Wales Supreme Court decision of Davidson v
Sampson provides an example of an estate that fell subject to
The case concerned the estate of Ms Boorne. Shortly before she
died, Ms Boorne purchased a $2 million property with her second
husband. She contributed 75% of the purchase price for the property
and her second husband contributed the other 25%. However, they
registered the property solely in the name of the second husband,
because Ms Boorne was concerned that her former husband and their
son might make a claim against her estate, and she wanted to ensure
that her second husband was able to keep the property after she
After Ms Boorne died, her son did make a claim against her
estate. The court held that 75% of the value of the property formed
part of Ms Boorne's 'notional estate' and was available
to make provision for her son. The court made orders that the
property be sold and 60% of the sales proceeds be paid to Ms
In this instance, Ms Boorne's attempt to protect the
property for her second husband unfortunately failed because of the
'notional estate' principles.
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guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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