The harsh reality is that if you do not have a Will, you do not have a say.
If you die without a Will – or without an effective Will – your Estate is dealt with under the intestacy provisions in Chapter 4 of the Succession Act 2006.
As an example:
If you have a spouse (somebody to whom you are married, or with whom you were carrying on a domestic partnership, being a relationship in existence for a continuous period of 2 years or resulting in the birth of a child) your spouse will be entitled to the whole of your Estate.
If you and your spouse have children, your spouse is entitled to the whole of your Estate.
If you have children, who are not the children of your spouse, then your spouse is entitled to your personal effects, a statutory legacy and one half of the remainder of your Estate.
There is a simple way to avoid the complexity of intestacy. Make a Will.
The only way to ensure that you have control over deciding how your estate is divided is to have a valid Will.
Once you have made your Will, it is important that you review it every few years and update it as your circumstances change.
At Everingham Solomons we have the knowledge and experience to identify the legal issues relevant to your situation and advise you of the options available so you can make an informed decision that is right for you because Helping You is Our Business.
This is one of the most common questions asked in relation to deceased estates.
Beneficiaries are, understandably, eager to receive their interest in the estate and executors are eager to finalise their duties.
Despite this often mutual desire to distribute the estate quickly, there are several requirements that must be met prior to any distribution.
Probate must be granted by the Supreme Court of New South Wales. Probate establishes the validity of the deceased Will. Once probate is granted, the executors are legally entitled to administer the estate pursuant to the terms of the Will.
Prior to distribution, a Notice must be posted on the Supreme Court website alerting creditors and other interested parties that the executors intend to distribute the estate assets.
What happens if an executor distributes the entire estate leaving no money in the estate and a creditor or beneficiary or tax office or other party comes forward claiming that the estate owes money?
If the executor has complied with certain requirements for distribution of the estate, her/she will not face personal liability for any such claims made subsequent to a full distribution of estate assets.
The requirements are that the estate is distributed at least six months after the deceased date of death and the executor has published a 30 day notice of intention to distribute and that time period has expired.
An additional issue which must be considered prior to distribution, involves claims being made against the estate by a relative or dependant who is seeking a share or greater share of the estate.
Claimants have 12 months from the date of the death of the deceased to file a claim and any executor who distributes the estate prior to the expiration of that 12-month period may be held personally liable if he/she has distributed the estate knowing of a potential claim.
The timing of the distribution of deceased assets by the executor, in each case depends on the facts of the case and an assessment of the particular risk of a claim being made against the estate.
If you need assistance with the administration of the estate contact us at Everingham Solomons Solicitors becauseHelping You is Our Business.
The Personal Property Securities Act 2009 (Cth) (hereafter called ‘PPSA’) is dangerous for people (hereafter called ‘owners’) that, as part of their business, lease or loan goods to others (hereafter called ‘lessee’).
When goods are loaned or leased for a term of more than one year, or, an indefinite
term – that is any length of time, no matter how short, without a firm end date – the owner of the goods may unknowingly be creating a deemed security interest in the goods which requires registration under of the PPSA.
The problem is of course that the average person has no idea that they are creating a deemed security interest and therefore no idea of the need to register it.
Often, the first time the owner of the goods becomes aware of a problem is when someone else asserts a right to take the goods directly from the lessee. The logical exclamation from the owner is likely to be ‘But, I own it!’ Well, hard as it may be to believe, that may not matter.
The PPSA provides that where the owner doesn’t register their deemed security interest:
upon insolvency the goods become the property of the insolvent person, and therefore open to be taken by a liquidator;
upon sale to a third party, the third party takes free of the security interest, that is, free from the interest of the owner; and
in terms of priority, the unregistered security interest ranks below a registered security, which makes the property open to be taken by a secured creditor’s receiver.
Why on earth, you might ask, did someone come up with such a law? Well, it is to aid secured lending by addressing what would otherwise be problems with apparent ownership.
When a financier loans money, they do so after making an assessment of the value of assets that the borrower has. If you look like you own a lot of assets because you lease or have been loaned a lot of assets, then the rationale is that, in absence of the true owner declaring their ownership through registration, the financier should be able to access the assets if the borrower defaults.
If you need assistance with any commercial problems, contact Everingham Solomons because Helping You is Our Business.
In 2014 Sally made a Will in which she left her property to her son Peter and the remainder of her estate her to daughter Jane.
In 2015 Sally made a Power of Attorney appointing her daughter Jane as attorney.
In 2016 Sally had a stroke and had to go into care.
Jane needs to sell Sally’s property to pay for the nursing home accommodation bond.
Can Jane sell the property?
Provided it is necessary and appropriate in all the circumstances and in Sally’s best interests, Jane can sell Sally’s property and use the sale proceeds to finance the nursing home accommodation bond, regardless of the fact that the property is bequeathed to Peter in Sally’s Will.
What does that mean for Peter?
For Powers of Attorney made prior to 16 February 2004, the common law of ademption applies, that is if the gift to the beneficiary no long exits the beneficiary misses out.
Luckily for Peter, where a Power of Attorney is made after 16 February 2004, which Sally’s was, the harshness of the common law is ameliorated by section 22(1) of the Power of Attorney Act 2003 which states:
“any person named as a beneficiary under the Will of a deceased who executed an enduring power of attorney has the same interest in any surplus money or other property arising from sale or disposition of any property by the attorney under the power of attorney, as the named beneficiary would have had in the property if no sale or dealing had been made.”
This means that when Sally passed away Peter will be entitled to the refund of the accommodation bond, as it represents the proceeds of sale from the house bequeathed to him.
If you want your wishes to take effect, it is imperative that your documents be up to date and properly drafted. You should be aware that each case has unique facts and these general propositions cannot be applied in every circumstance to achieve the same result. The experienced solicitors at Everingham Solomons can assist you with all of your estate planning needs because Helping You is Our Business.
Recent decisions in the Supreme Court have reinforced the Courts preference for keeping family operated farms together in certain situations in circumstances where a Will is contested.
A recent case involving a grazing property near Wagga Wagga upheld the deceased’s wishes to keep together a farming operation that had been left to the son at the exclusion of a claim made by a city-based daughter of the deceased. Whilst the daughter had been able to establish need she was ultimately unsuccessful.
When determining need “the court also considers the nature, extent and character of the estate.” The character of the estate in an example of a rural estate with its major asset a working farm is a significant factor that a court will consider.
When considering Provision Claims the Court will assess the needs both present and future of a person of whom makes an application for Family Provision. In the context of rural estates the term “Need” is very much an ambulatory concept.
A deceased testamentary intention to keep a farm together as an integrated economic unit, managed and run by a beneficiary of their choosing is something that a court gives significant weighting to.
Arguments about fairness between children of the deceased can be overtaken by a clearly expressed intention of the deceased. The position of the Supreme Court is that it has no mandate to simply “ride roughshod over the testator’s intentions”
When considering breaking up a rural estate a Court will look to whether or not the viability of the farm is dependent upon it operating as an integrated whole and if the deceased’s intention to keep the farm together was made clear.
The recent decisions of the Supreme Court only stand to emphasise the need to have a clearly defined succession plan in place. At Everingham Solomons we can assist with such planning because Helping You is Our Business.
To make a valid Will a person must be of sound mind when the Will is made. Where a Will is the product of undue influence then it may be declared invalid if undue influence can be proven by the person alleging it. Undue influence goes beyond mere persuasion. “The essence of undue influence is coercion of the will so that the [Willmaker] does that he or she does not desire to do”. One recent Victorian case refused an application that there was undue influence exerted over the Willmaker when she made her Will.
In 2015 the deceased died at the age of 91 survived by 3 adult sons. The deceased made a Will in 2013 whereby she appointed a family friend and one of her sons as the executors of her Will. The deceased left her residuary estate to be divided between her three sons as to 20 percent, 35 percent and 45 percent respectively. The son who received only 20 percent of his mother’s estate applied to the Court alleging that the 2013 Will was invalid because it was obtained as a result of the undue influence of his two brothers who had the care and control of his mother before she died.
An allegation of undue influence is a serious matter and must be proved on the balance of probabilities and supported by full particulars. “To prove undue influence, it must be shown that the [Willmaker] did not intend and desire the disposition. It must be shown that she has been coerced into making it”.
The applicant son relied on the following matters:
(a) the applicant son placed the deceased in residential care in October 2012;
(b) some four weeks into her stay in residential care, one of his brothers removed her from residential care;
(c) thereafter the deceased was under that same brothers ‘care and control’; and
(d) the deceased executed her Will when she was being kept substantially isolated from the applicant son until her death.
Applying the test of undue influence to the particulars in this case the Court stated “there is no allegation of influence let alone that the influence was undue. There is no allegation that, in making the dispositions under the 2013 Will, the [will maker] was coerced or that her will was overborne in circumstances that her judgment was not convinced”.
It is important to note “the fact that an allegation of undue influence is a serious allegation does not mean that, in an appropriate case, it should not be made”. However “Particulars which are consistent only with the opportunity to influence a will maker are not sufficient” to prove undue influence.
At Everingham Solomons we have the experience and expertise to assist you in all matters concerning your Will or that of a recently deceased family member because Helping You is Our Business.
Click here for more information on Lesley McDonnell
Everingham Solomons is proud to be one of the major sponsors and organisers of the Pedal the Peel Cycling Challenge to be held at Moore Creek Tennis Club, Moore Creek Rd, Tamworth on Sunday, 2 April 2017.
The event is unique to Tamworth because it caters for all levels of rider fitness and experience.
You can choose from a flat 16 km or 24 km course or the more challenging 55 km or 115 km hilly courses.
The event is designed to encourage all levels of riders (minimum age 12 years) to become involved, have a great fun day and help raise money for local charities.
It is unique because we don’t ask you to raise thousands of dollars sponsorship to ride in the Challenge.
You only need to pay your registration fee of $50 per rider or $100 for a group of 4 riders.
Included in the registration fee is a steak sandwich and drink which will be provided on return to the start/finish location at Moore Creek Tennis Club. There will also be live music at the start/finish site, so you can enjoy some socialising on your return.
It’s unique because it supports lesser known and less well-supported community organisations.
This year the event will support Youth Insearch which is a grass roots, early intervention program which works with at risk youth and focuses on resolving adolescent issues at peer level. This organisation has had tremendous results in assisting at risk youth change their lives.
We are also supporting the Banksia Acute Mental Health Unit at the Tamworth Base Hospital and other mental health charities in the Tamworth region.
We all know that mental health has become a huge issue and this is our way of helping address mental health in our region.
You know the event will be well-run and costs kept to an absolute minimum because it is an event organised by the Rotary Clubs of Tamworth First Light and the Rotary Club of Sunrise.
I encourage you to get a team together, challenge your friends and work mates…remember 4 riders only costs $100 and the money goes to deserving local charities. Let’s help make this event a fantastic success.
You can register online at www.pedalthepeel.org.au
In NSW, if a person was on their way to or from work (known as ‘journey claims‘) and they suffered an injury, they have always been covered for workers compensation. That was up to 2012. In 2012 the Workers Compensation Act 1987 was amended and one of the changes that came in related to journey claims.
Section 10(3A) of the Workers Compensation Act 1987 provides that for journey claims there needs to be ‘a real and substantialconnection between the employment and the accident‘.
The question therefore is ‘what is a real and substantial connection?‘
The two leading cases are:
Singh & Singh t/as Krambach Service Station v Wickenden [2014] NSWWCCPD 13 – Ms Wickenden was working at the Krambach Service Station and travelled by way of motor bike in the daytime to and from work. On the day of the accident Ms Wickenden was asked to work longer hours for a period which meant that she finished work in the dark and whilst she was driving home a car travelling in the opposite direction, swerved to miss some cattle and collected Ms Wickenden. The question was whether there was a real and substantial connection between her employment and the accident. It was held that as her employer required her to work later than normal and therefore she rode home in the darkness and the darkness was one of the causes of the accident, there was a real and of substantial connection;
Namoi Cotton Co-Operative Ltd v Easterman (as Administrator of Estate of Easterman) [2015] NSWWCCPD 29. In that case the deceased worker was driving a vehicle home when she was killed. It was established that she fell asleep at the wheel. The applicant had worked 60 hours in the proceeding five day shift. As fatigue was the cause of the accident, and her employment was the cause of the fatigue, there was a ‘real and substantial connection between the applicant’s employment and the accident‘.
These decisions illustrate that employment does not need to be the sole cause of the accident. ‘Real and substantial‘ connection is a wider concept and captures scenarios where there is a more ephemeral connection between employment and the injury.
If you should have any queries in respect to journey claims and other workers compensation questions please do not hesitate to contact us at Everingham Solomons because Helping You is Our Business.
Business operators need to review their business structures on a regular basis.
What you set up years ago may well have been correct at the time but it may not be optimal for your current situation, particularly if your business has expanded.
In past times there were usually stamp duty and capital gains tax costs that needed to be built into any restructure decision and often those costs made restructure not viable.
From 1 July 2016 stamp duty and capital gains tax laws changed markedly –
Stamp duty on business assets other than land was abolished in NSW; and
New tax legislation usually referred to as “small business restructure rollover” (“SBR”) took effect. These provisions enable businesses whose aggregate annual turnover is less than $2 million to restructure their business asset holdings without income tax or capital gains tax liabilities.
The tax law change is particularly significant. Unlike other “rollover” provisions that existed before that time the SBR rollover allows transfer of assets between different types of business structure. Under pre-existing CGT rollover rules, individuals and trusts could transfer to companies but under SBR assets can be transferred from the existing structure into any other form of structure. For instance trust to trust, company to trust and trust to company transfers are all possible. The main exclusion is that transfers to self-managed superannuation funds are not allowed.
The SBR rollover is also wider than the previous provisions in that it allows not only CGT assets to be transferred but also depreciating assets and trading stock.
Whilst stamp remains an issue for restructures involving land, there are concessions available particularly for farming land which can be very helpful in reducing or avoiding stamp duty cost.
Restructuring a business is complicated and expert advice needs to be obtained.
At Everingham Solomons we have the expertise to work with business operators and their accountants to optimise business structures Because Helping You is Our Business.
Most of us understand the importance of reducing a commercial contract to writing.
However, even then, two parties will sometimes take different views on what the written words of the contract actually mean.
When courts investigate the meaning of words written in a contract, they call the exercise ‘contractual interpretation’. When you draft your own contract it’s important to follow the same principles that a court would apply if it were asked to interpret the words.
Firstly, the contract is considered objectively. That is, the parties themselves are not asked what they intended by the words, rather the question is what a reasonable third person, reading the contract would take the words to mean. The pre-contractual negotiations will often be irrelevant, as will the course of conduct after the formation of the contract.
Secondly, where the contract is in writing, effect should almost always be given to the written words. If a contract is silent on what is to happen in certain circumstances, then the loss lies where it falls. Courts will not add words to a contract unless it is necessary for the contract to work on the most fundamental level, or, the words to be implied are so obvious that they ‘go without saying’.
Thirdly, the contract should be read as a whole. That is, if two possible interpretations of a term arise, effect should be given to the interpretation that best aligns with the flavour of the rest of the contract.
Lastly, contracts are interpreted in the context of the relevant background. That is, if two interpretations of a contract arise, the one that seems most likely in the context should be adopted.
Merely putting something in writing is not always enough. Many commercial disagreements arise, because contracting parties have differing views on what the actual words mean. For that reason it’s always good practice to have important contracts drafted by a professional and to seek professional advice on the likely meaning of the words.
If you need assist drafting or understanding a commercial contract, contact Everingham Solomons because Helping You is Our Business.
The harsh reality is that if you do not have a Will, you do not have a say.
