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How Do I Deal With an Estate Without a Will?

How Do I Deal With an Estate Without a Will?

When a person dies without a will, they die ‘intestate.’ This means that the laws of the state or territory where the person died decides how the estate is to be administered. This often raises the question, “How do I deal with an estate without a will?”

When this happens, the state or territory government follows a strict protocol, to ensure the deceased’s assets and liabilities are taken care of and split up among beneficiaries in a fair and just manner.

Alternatively, an eligible person, usually a partner, children or next of kin, can apply for a grant of administration so that they can administer the estate on behalf of the deceased.

Each state and territory has their own guidelines in regards to who can apply for a grant of administration, who is considered an eligible beneficiary, and the process in which the estate is administered.

For this reason, it’s a good idea to get up-to-speed with the guidelines in your local state or territory, and seek expert legal advice from an accredited solicitor.

First, dealing with unpaid debts

Before the estate can be administered to relatives and other beneficiaries, all debts must be repaid to people that the deceased owed money to.

Some of the most common debts that need to be repaid are:

  • Funeral expenses
  • Taxes
  • Mortgages
  • Credit card debts
  • Debts to financial institutions and other lenders
  • Outstanding administrative and legal expenses

After these debts have been cleared, the remaining assets listed can then be distributed to relatives and eligible beneficiaries. This process can be handled automatically by the relevant state or territory government, or an eligible estate administer or Trustee Company.

For expert advice on how to deal with an estate without a will, contact McDonnell Schroder today.

Who is eligible to inherit from a deceased estate?

Each state and territory has their own guidelines in regards to who can inherit from a deceased estate, and the order of priority in which a beneficiary is placed – as in, who is first in line to receive a portion of the estate.

Generally speaking, though, if the deceased had no will, their estate will be distributed to relatives in the following order:

  • Spouse or de-facto partner (of any sex)
  • Parents
  • Siblings
  • Grandparents
  • Uncles and aunts
  • Cousins

In the case that the deceased has no living relatives, the assets are passed on to the state or territory government.

In addition to this, for every beneficiary on this list who is not found, the order of priority moves on to the next beneficiary. For example, if the deceased had no spouse or partner, then the parents are next in line, and so forth.

Definitions of relatives

Below is a simple breakdown of how most states and territories define each relative. There may be slight variations for each region, so please refer to your state or territory government for clarification.

Spouses and partners

If the deceased has only one spouse or de-facto partner, then that person will inherit it all unless they also had children.

For those in a de-facto relationship with the deceased, they need to prove they were a domestic partner. The criteria to be acknowledged as a de-facto partner may differ among regions. For example, in Victoria, the person must have been living with the deceased in a domestic relationship for at least two years prior to their death.

If the deceased was in a relationship with multiple partners, these people will need to prove they were either an eligible spouse or de-facto partner. Otherwise, the division of assets will move on to the children, and so forth.

Children and grandchildren

In most cases, all eligible children receive an equal share of the deceased’s assets.

If the deceased had children from a previous relationship, then a portion of the assets may also go to them. However, this only applies if the monetary value of the assets exceeds a certain amount, for example $500,000 or higher after all debts and expenses are paid.

In the event of no children, the assets are passed on to eligible grandchildren. However, if the deceased’s children has also passed away, and they themselves had children, then those children would get the same amount of assets that their parents would have otherwise received.

Step-relatives

Both step-children and adopted children are treated exactly the same as children born to both parents.

Remaining relatives

If none of the above applies, then the order of inheritance moves down to Siblings, Grandparents, Uncles and Aunts, and First then Second Cousins. Keep in mind, the order of priority may differ based on your state or territory.

How to apply for a grant of administration

For those wanting to be an estate administer they need to go through a series of steps.

Generally speaking, any surviving family member who is eligible to inherit an estate can apply for a grant of administration. Of course, family members are encouraged to reach an agreement on their own, and then decide whether to entrust such a task with an individual or trustee company.

Below is a general overview of the criteria that an estate administer must meet:

  1. Confirm there is no will: You will need to do this even if the deceased said they did not have a will. Do a thorough search of the deceased papers, including papers that any surviving family members or friends may have access to. You can also consult their bank and other relevant financial lenders.
  2. Get certificate: You will need to get a death certificate. You may also need to get a certificate to prove the nature of your relationship with the deceased.
  3. Outline the order of beneficiaries, and what they are entitled to: In accordance with interstate law, you need to clearly outline who is entitled to receive assets and the amount of assets each person receives.
  4. Make your intention to apply for a grant of administration public: Visit your local state registry and make it known that you intend to apply. You must wait at least two weeks after stating your intent before you can apply. This gives other potential beneficiaries, and anyone who may be aware of the presence of a will, a chance to get involved
  5. Complete the paperwork: Once you’ve completed all the above steps, you can then file an application for a grant of administration. The information you will need to include will depend on your unique circumstances.

When to consult a solicitor

On paper, the steps required to apply for a grant of administration sound simple. In reality though, things can turn out to be more complex than you think.

For instance, you may find out later on that there actually is a Will, thus complicating your initial plans. One or more family members or beneficiaries may start a disagreement. You may find it difficult to comprehend certain aspects of the paperwork. Or a certain beneficiary may take legal action in an attempt to claim a higher portion of assets.

In any of the above circumstances, the expert legal advice and guidance of a solicitor can make all the difference. They can assess your case, review the evidence, and determine the chances of your case being successful.

If you have a strong case, a solicitor can guide you through the legal process to help you achieve a fair and just outcome.

McDonnell Schroder can help you deal with an estate without a Will, and guide you through the essential legal proceedings. To book an appointment with an accredited solicitor, call (02) 9622 1155 or complete the online form.

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