Apart from the time to consider all of the issues that need to be considered in formulating an estate plan, the estate planning foundation: a valid Will, is core to the end process.
Is my Will fully valid; and up to date?
Estate planning is, as noted earlier in this series of posts, a process more so than a set of documents. However, the documentation of that process is critical to ensuring that the anticipated outcome is achieved. The first document that comes into play at the ‘critical’ level on the demise of a testator is their Last Will and Testament.
In this post we consider some of the more common elements that need to be present for that document to be considered valid: and others that might render that document invalid. We also raise the issue of whether the Will terms are up to date.
NOTE: these comments are specifically relevant to the law as it applies in Queensland. If you’re planning in another jurisdiction we recommend that you speak with an estate planning specialist with experience in that jurisdiction.
What makes a Will invalid?
Some of the matters that render a Will (or at least parts if it) invalid include –
If you marry after having made a Will but that Will does not include a specific mention of the upcoming marriage, the Will is rendered totally invalid as a consequence of that event. (The lawyers use the term: ‘in contemplation of marriage’.)
This is only relevant to legal marriages: it does not apply to de facto marriages.
Divorce does not automatically revoke a Will (or render it invalid as such), however it does automatically invalidate those clauses in a Will that refer to the former spouse: provisions such as
- any gift to the former spouse fails; and
- an appointment of the former spouse (as say, the executor of the estate) also fails.
This can result in the Will being either totally or partially invalid.
Competence – and compliance:
For a Will to be valid it is imperative that the testator is competent (of sufficiently sound mind) to make their wishes known in a way that they are aware of the consequences of their expression. At an appropriate stage in the process – and again at the formal signing of the Last Will and Testament documentation – the legal adviser will counsel that there be certainty as to this level of competence.
Compliance (at signing)
Whilst various Court actions can be taken to seek to have a Will validated in spite of non-compliance with the sign-off procedure, it is better to avoid that process and ensure that the original document is signed contemporaneously:
- By the testator and two independent witnesses who are
- Not beneficiaries under the terms of the Will;
- In the same room at the time of signing
- All using the same black (preferred) pen/ biro.
Court challenge/ contest
Whilst this may not render a Will invalid nor out of date (although either finding is possible), a Court could be asked to find that its provisions have not made adequate provision for other potential beneficiaries. [This is one of the areas that carefully considered estate planning helps to avoid.]
What can make a Will ‘out of date’?
There are many events that could cause a Will to be considered ‘out of date’: these may result in beneficiary distributions contrary to what would have been preferred –
Consider the following:
- Has anyone named in your Will died or changed their name?
- Are the people you have appointed as either executor or guardian of any young children still available or your current preference; or indeed, have the children aged beyond needing a guardian?
- Do you want to change your named beneficiaries (e.g., are there new grandchildren to consider)?
- Has your financial position changed (are there bequests that can no longer be met; or that will distort the final distribution of the estate); or has added wealth given rise to different considerations?
- Are you interested in giving your beneficiaries more scope for minimising their tax or protecting your gift from their creditors or the Family Court?
- Do you still own all any assets mentioned as specific bequests in your Will?
- Have tax laws changed in a way that could impact on your plans?
Where can I get help with Estate Planning?
The Continuum Financial Planners Pty Ltd Estate Planning service offers clients:
- working with them to prepare the detailed information required for their appointed estate planning specialist lawyer; who can then
- consider the client’s individual detail in light of their estate planning experience so as to design a plan appropriate to the client’s present and known likely circumstances; and where needed
- provision of access to our referral connections of such professionals (to whom we are happy to refer you to match their expertise with circumstances such as your own).
As with all ‘plans’, estate planning should be reviewed on a regular basis. We commend a reading of all of our articles in this series to you; and to consult with one of our experienced advisors to ensure your estate planning receives the attention needed to ensure your wishes can be provided appropriately. We defer to legal advisors (who are estate planning specialists) in appropriate circumstances, liaising between you and them to optimise the efficiency of the process. To make an appointment, call our office (on 07-34213456) or use the online Contact Us facility.
More about Estate Planning…
This is the twelfth in a series of 13 articles on the topic of Estate Planning: further articles in the series seek to bring clarity to some of the issues and implications to be dealt with in fulfilling the three key considerations of Estate Planning – getting the right amount of money, to the right beneficiaries and at the right time; and to prepare you and your family to understand the final plan when drafted. The remaining articles consider –
- Estate Planning outlined;
- Estate planning and flexibility in the modern Will;
- Asset protection using Estate Planning;
- Superannuation death benefit nominations and Estate Planning;
- Estate planning and Business Succession planning;
- Capital Gains Tax impact on estate planning;
- Estate planning and family loans;
- Estate planning and company-owned assets;
- Estate planning for a SMSF trustee;
- Estate planning and superannuation assets;
- Estate planning with a testamentary trust; and
- Estate planning for younger children.
(This series was first posted to our website over a period from late-2011 through early-2012; it has been refreshed, updated and re-posted in February 2015.)