Probate and Estates

What is Probate?

When someone passes away their assets must be collected in and their liabilities paid.

If a person owns a property, or they hold a significant amount of money in a bank or in shares or in a bond for a care home, then probate of their Will is required before these assets can be collected in and dealt with.

To obtain probate, the executors of the estate send the deceased’s Will to the Supreme Court with a Death Certificate and an Inventory of Assets and Liabilities.

The executors must swear an Affidavit declaring that they believe the Will to be the last known Will of the deceased.

The Court will then assess the Will to ensure it is valid and if so, the will provide the executors with a Grant of Probate.

The Grant then authorises the executors to collect in funds from a bank, dividends from shares, or a bond from a care home and to distribute them to the beneficiaries.

It also authorises them to sell or transfer the deceased’s property in accordance with the terms of the deceased’s Will.

Until the Grant is made, the executor may only pay funeral expenses from the deceased’s bank account.

However, if the deceased did not own property, and only held a small amount of funds in a bank, then probate would not be require and the executors could collect the funds from the bank.

The process of estate administration can often take up to 12 months, and sometimes longer. The executors generally have 12 months in which to Wind Up an estate before any beneficiary is able to complain.

In Victoria, a claim may be made on an estate with 6 months from the Grant of Probate or Grant of Letters of Administration. It therefore may be prudent for executor to wait for at least 6 month from the Grant of Probate before they distribute the estate. If the executors distribute before the 6 months, and someone makes a successful claim on the estate, the executors may be held personally liable to satisfy the claim.

The Legal Practitioners’ Liability Committee has also published some useful guides for executors and beneficiaries which you may view via the links below.

Guide for Beneficiaries

Guide for Executors

What if the Will is not valid?

In some cases, a Will may not be valid, or may only be partially valid. This may be due to:

  • the Will not being witnessed correctly
  • the Will appoints an ex-spouse as an executor
  • the Will benefits an ex-spouse
  • the appointed executor(s) has already passed away

If the Will is partially valid, those parts that are valid will still take effect.

For example, if an ex-partner receives a benefit, under the Will, those parts will be invalid, but the rest of the Will is valid.

If the appointed executors have passed away, then the Will is still valid but the next of Kin would need to apply to the Court to be appointed as the ‘Administrator’ of the estate. The Administrator then takes on the role the the executors would have. They are however granted ‘Letters of Administration’ as opposed to Probate.

What if the deceased did not have a Will?

If the deceased did not make a Will, or if it cannot be found, then their estate is distributed in accordance with the laws of intestacy. Intestacy occurs when a person dies without a Will and they are said to have died ‘intestate’.

Generally, this means the deceased closest next of Kin inherit their estate.

If the deceased is survived by their partner (a spouse they were married to at the date of their death, even if they were separated at the time or a domestic parter) and children that are the children of the deceased and surviving partner, then the surviving partner inherits the entire estate.

A domestic partner is someone who was living with the deceased as a couple on a genuine domestic basis for a 2 year continuous period prior to their death.

If the deceased is survived by a partner, and children of a previous relationship, then the partner firstly receives a Statutory Legacy and then they also receives half of the balance of the estate. The other half of the balance of the estate is shared equally by the deceased’s children from a previous relationship.

As at 30 June 2021, the Statutory Legacy is $480,700.00. This amount is tied to the Consumer Price Index and increases each year (at June 2018 it was $451,909.00)

If the estate is valued at less than $480,700.00 then the partner takes the entire estate.

If the estate is valued at more than $480,700.00 then the partner takes the first $480,700.00 and one half of the balance of the estate including the deceased’s personal effects and property.

For example, from an estate valued at $1,000.000.00, the partner would receive $740,350.00 ($480,700.00 + $259,650.00) and the children from a previous relationship would equally share the amount of $259,650.00.

If the deceased does not leave a surviving partner or children, then the chain of intestacy is:

  • parents
  • siblings
  • grandparents
  • aunties, uncles cousins

If no one is entitled to inherit the estate then it is deemed that the property has no owner and is passes and belongs to the Crown (Government)