A recent decision of the Supreme Court of Western Australia
highlights the importance of recognising the different estate
planning considerations that apply to a person's actual assets
which they are capable of leaving by will and superannuation
Mrs Conti died in 2010, leaving a will naming her children as
her executors. The will also contained a direction that her
superannuation entitlements be paid to her children and not to her
The deceased and her husband were the joint trustees and the
only members of a self managed superannuation fund (SMSF). The
terms of the SMSF trust deed provided that in the absence of a
binding written nomination, the trustees of the SMSF had a
discretion to pay or apply the deceased's superannuation
balance to her spouse or her child or financial dependant.
The deceased had made binding nominations in 2002 and 2006.
However, since a binding nomination lapses after three years, there
was no current binding nomination in place at the time of her
Shortly after her death, her husband nominated a company of
which he was the sole director to become the trustee of the SMSF.
He, as the director of the company, then made a determination that
the deceased's superannuation balance be paid to himself.
The children, as executors of her will, challenged his conduct
on the basis that he should have nominated them as additional
trustees of the SMSF. They alleged that the trustee of the SMSF had
acted improperly in determining to pay the deceased's
superannuation balance in the way that he did.
The court found that there was no legal basis on which the
executors could insist on being appointed as trustees of the SMSF.
The court also found that the trustee of the SMSF was entitled to
ignore the directions in the will in relation to the deceased's
superannuation balance and that his decision could not be
challenged as having been made in bad faith.
The decision highlights the problems associated with binding
death benefit nominations. To be effective, the nominations must be
renewed every three years and if the time limit is missed the
binding nominations become ineffective. Also, if the person
concerned were to lose capacity, they would also lose the ability
to renew any binding nominations.
Ioppolo & Hesford v Conti  WASC 389.
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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