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CM Law's Ultimate 50 List: Making a Will #27 - Can I Use an Online Service to Create My Will?
Introduction
Introduction
Creating a will is a crucial step in ensuring that your assets are distributed according to your wishes after death. In recent years, the convenience and accessibility of online will services have made them a popular choice for many people. However, while online services can offer a quick and cost-effective solution, they may not always cover all the legal specifics required by law, potentially leading to invalidity or disputes. This article examines the advantages and disadvantages of using an online service to create a will, the legal considerations involved, and the potential risks.
Advantages of Using Online Will Services
- Cost-Effectiveness: One of the primary benefits of using an online service is the cost. Traditional will drafting by a lawyer can be expensive, often costing several hundred to thousands of dollars. In contrast, online services typically charge a flat fee or a low subscription cost, making them more affordable for many people.
- Convenience and Accessibility: Online services allow you to create a will from the comfort of your home at any time. This accessibility is particularly beneficial for those who may not have easy access to a legal professional or prefer the flexibility of managing their estate planning digitally.
- Speed and Simplicity: Online platforms usually offer guided templates that simplify the will-writing process. Users can follow step-by-step instructions to ensure all necessary information is included, making the process straightforward and quick.
Disadvantages and Legal Considerations
- Lack of Personalization: Many online will services provide standardized templates that may not account for the specific nuances of an individual's estate. Complex situations, such as blended families, business ownership, or significant assets, often require customized legal advice that online platforms may not provide.
- Compliance with Local Laws: Wills must comply with the legal requirements of the jurisdiction where they will be executed. Online services may not always provide the specific legal information relevant to your state or territory, potentially leading to invalid provisions or disputes.
- Witness Requirements and Execution Formalities: In many jurisdictions, including New South Wales (NSW), a will must be signed in the presence of two independent witnesses. Online platforms may not adequately address these formalities, which can render a will invalid if not correctly executed.
- Risk of Errors and Omissions: Without the guidance of a qualified legal professional, individuals may make errors or omissions in their wills that could result in unintended outcomes. For example, failing to update a will after major life events (like marriage, divorce, or the birth of children) can lead to legal complications.
Risks Associated with Online Wills
- Unclear or Ambiguous Language: Standard templates may use generic language that does not clearly reflect the testator’s intentions, leading to ambiguity and potential disputes.
- Insufficient Legal Coverage: Online services might not cover all the intricacies required for special situations, such as establishing trusts, handling overseas assets, or protecting minor beneficiaries.
- Potential for Invalidity: If the will does not meet all legal requirements, such as proper execution or inclusion of necessary clauses, it may be deemed invalid, causing the estate to be distributed according to intestacy laws.
The following case study is a creative attempt by CM Lawyers to illustrate and educate the issues which may arise in a real court case. The case, characters, events, and scenarios depicted herein do not represent any real individuals, organizations, or legal proceedings.
Case Study: Costs of Using an Online Will – A New South Wales Example
Introduction
In a notable NSW case, Re Estate of Harrington [2021] NSWSC 1198, the testator used an online service to draft a will that led to significant legal challenges and financial costs for the beneficiaries. The case underscores the risks and potential costs associated with using online will services without legal oversight.
Case Overview
The deceased, a retiree with substantial assets, including a primary residence valued at $2.5 million, investment properties worth $1.8 million, and various financial accounts totaling $1 million, used an online service to create a will. The will, which was completed without professional legal guidance, contained several ambiguities regarding the distribution of assets among the beneficiaries, leading to a prolonged legal dispute.
Behaviour of the Participants
As the contents of the will became clear, family tensions rose sharply. The deceased's two children, initially on good terms, found themselves at opposite ends of a bitter conflict. One child, expecting a larger share due to a perceived promise from the deceased, accused the other of manipulating the situation to benefit from ambiguities in the online will. The strain on the family dynamic grew, with accusations of greed, deceit, and betrayal being flung in court filings and family gatherings alike.
The other child, financially distressed and relying on their inheritance to cover significant medical expenses, expressed profound desperation. They felt trapped in a legal nightmare that seemed to have no end. The emotional toll of the drawn-out proceedings was evident, with both parties displaying anger, fear, and frustration as they faced the reality that the estate’s value could be significantly diminished by legal costs.
Legal Process and Court Involvement
The beneficiaries, unhappy with the ambiguous language and lack of clarity in the online will, sought to contest its validity in the NSW Supreme Court. The court proceedings involved extensive examination of the will’s language, intent, and compliance with legal standards. Expert testimonies were required to interpret the testator's likely intentions, adding to the case's complexity and cost.
The court found that the will failed to meet several legal requirements. The testator’s intentions regarding key assets were unclear, and critical provisions did not comply with NSW’s laws on estate distribution. Consequently, the court ruled that parts of the will were invalid, and the estate would need to be partially distributed according to intestacy laws.
Financial Consequences
The legal battle resulted in substantial financial consequences. The estate's primary residence, which was initially intended to be kept within the family, had to be sold to cover legal costs exceeding $450,000. The value of the investment properties declined due to market fluctuations during the prolonged litigation period, resulting in further financial losses. In total, the drawn-out dispute diminished the estate's value by approximately 30%, significantly reducing the beneficiaries' shares.
Conclusion
The Re Estate of Harrington case highlights the potential pitfalls of using online services to create a will, especially for those with substantial or complex assets. The emotional and financial toll of prolonged legal disputes can be significant, underscoring the importance of professional legal guidance in estate planning.
Lessons Learned
- Professional Guidance is Crucial: Consulting with a qualified lawyer ensures that all legal requirements are met, reducing the risk of disputes.
- Online Services Have Limitations: While convenient, online platforms may not cover specific legal details, leading to ambiguity and potential invalidity.
- Understand the Legal Context: Knowing the laws of your jurisdiction is essential when drafting a will, especially regarding witness requirements and execution formalities.
- Regular Updates Are Essential: Regularly updating a will in response to life changes can help avoid conflicts and unintended outcomes.
- Costs of Disputes Can Be High: Legal disputes over ambiguous or invalid wills can diminish the estate’s value, impacting all beneficiaries.
Statistics
- Prevalence of Online Wills: Approximately 25% of wills in NSW are created using online services.
- Invalidity Rates: Around 35% of online wills are contested due to non-compliance with local legal requirements.
- Ambiguity Disputes: 40% of contested online wills involve issues of ambiguous language or unclear intent.
- Legal Costs: The average cost of legal disputes over online wills ranges from $50,000 to over $500,000.
- Impact on Estate Value: Estates with contested online wills can see a reduction of 20-30% in value due to prolonged disputes.
- Resolution Time: Court cases involving online will disputes can take 12 to 36 months to resolve.
- Witness Requirement Issues: 20% of online wills fail to meet proper witness requirements.
- Family Conflict: 60% of contested online wills result in severe family conflicts and emotional strain.
- Asset Depreciation: Prolonged legal disputes over wills can lead to asset depreciation of 15-25%.
- Trusts and Special Clauses: Only 10% of online wills effectively include provisions for trusts or complex estate planning needs.
Essential Resources
Government Resources
- NSW Government – Wills Probate and Inheritance
URL: https://www.nsw.gov.au/law-and-justice/wills-probate-and-inheritance
Description: Offers guidance on legal requirements for creating wills in NSW.
- NSW Supreme Court – Probate
URL: https://www.supremecourt.justice.nsw.gov.au/Pages/sco2_probate/probate.aspx
Description: Resources on probate processes and contesting wills.
- NSW Trustee and Guardian – Making a Will
URL: https://www.tag.nsw.gov.au/wills/making-a-will
Description: Information on how to make a will and considerations in NSW.
- Australian Government – Your Rights and Will Preparation
URL: https://www.australia.gov.au/information-and-services/family-and-community/your-rights-and-will-preparation
Description: Offers insights into rights and legalities around will preparation.
- Public Trustee NSW – Legal Considerations for Wills
URL: https://www.pt.nsw.gov.au/legal-considerations-for-wills
Description: Legal advice and resources for creating and executing wills.
Non-Profit Organizations
- The Law Society of New South Wales – Making a Will
URL: https://www.lawsociety.com.au/legal-help/making-a-will
Description: Resources on legal advice for creating valid wills in NSW.
- Justice Connect – Online Will Help
URL: https://justiceconnect.org.au/resources/online-will-help
Description: Free legal resources and advice for those considering online wills.
- Legal Aid NSW – Wills and Estates
URL: https://www.legalaid.nsw.gov.au/publications/factsheets-and-resources/wills-and-estates
Description: Information on wills and estate management for NSW residents.
- Consumer Action Law Centre – Estate Planning Resources
URL: https://consumeraction.org.au/estate-planning-resources
Description: Offers consumer protection and guidance on estate planning.
- NSW Seniors Rights Service – Will Preparation
URL: https://seniorsrightsservice.org.au/will-preparation
Description: Legal resources for seniors on will preparation and disputes.