Firstly, the family (or other potential representatives) need to determine the value of the assets in the estate. Where the value is less than $15,000, the process is more straightforward and letters of administration are not required. For estates worth more than $15,000, letters of administration will need to be obtained.
The Act sets out the process for applying for letters of administration, including who may apply; who the eventual beneficiaries will be; and what share of the estate they will receive.
Where the deceased leaves behind a surviving spouse, civil union partner or de facto partner, this person is entitled to a grant of letters of administration. If there is no surviving partner or spouse, the deceased’s children may apply, or, failing children, a grandchild may apply. The Act contains further provisions for circumstances where someone else has to apply.
Once an administrator is appointed by the High Court, that person then has authority to deal with estate assets, and those assets are then called in. For example, real estate or shares can be sold, and funds in bank accounts in the name of the deceased can be withdrawn, so that all liquidated estate assets are held in the same account in anticipation of distribution. The Administrator is then tasked to ensure that the estate is distributed in accordance with the Act. Section 77 of the Act provides an exhaustive list that determines who the beneficiaries of the estate are, and what they are to receive. For example, if the deceased leaves behind a surviving spouse and children, the estate is divided as follows:
Depending on who does or does not survive the deceased, the beneficiaries of the estate could also include siblings, parents, grandparents, aunts or uncles. Where none of these classes of beneficiaries exist, the estate vests in the Crown. The Crown has a discretion under the Act to provide for dependants of the deceased, and persons for whom the deceased might reasonably have been expected to make provision.
It is important to execute a will where the provisions of the Act do not reflect your wishes. For example, you may wish to make direct provision for nieces and nephews who are not explicitly provided for in the Act, or apportionment of assets under the Act may not be in accordance with your wishes. At Wakefields, succession planning is a core area of our business. We provide clear costings and would be happy to meet with you to talk through your succession planning needs and recommend solutions to you.