After you pass away, your will generally dictates how your estate should be distributed. However, there are circumstances under which a surviving spouse may have rights that could override your will’s instructions. In New South Wales (NSW), laws protect certain family members, particularly spouses, to ensure they are adequately provided for. This guide will explore the rights of a surviving spouse in relation to your will, the legal mechanisms they may use to alter the distribution of your estate, and provide a real-life case study from NSW to illustrate the complexities that can arise when a spouse seeks to challenge or change a will.
In NSW, the Succession Act 2006 (NSW) allows certain family members, including spouses, to make a claim against the estate if they believe they have not been adequately provided for. This is known as a "family provision claim." A surviving spouse is considered an “eligible person” under the Act and can apply to the Supreme Court of NSW to seek a greater share of the estate than what is provided in the will.
Jointly owned property, such as a family home or joint bank accounts, typically passes directly to the surviving co-owner by right of survivorship. This means that these assets are not considered part of the deceased's estate and cannot be distributed according to the will.
Binding financial agreements (BFAs), also known as prenuptial or postnuptial agreements, may influence the distribution of assets after death. A BFA can outline specific arrangements regarding the division of assets upon death, potentially limiting the surviving spouse’s ability to alter the estate’s distribution.
A family provision claim is the most common method by which a surviving spouse can challenge or change a will. If successful, the court may order that a portion of the estate be allocated to the spouse, even if the will states otherwise.
A surviving spouse may also contest the validity of the will by arguing that the testator lacked testamentary capacity, was unduly influenced, or that the will was improperly executed.
In some cases, a surviving spouse may seek a court order to become the administrator of the estate, especially if they believe the executor named in the will is not acting in their best interests or those of the estate.
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.
A recent case in New South Wales illustrates the potential consequences of a surviving spouse challenging a will. This case highlights the financial and emotional impact on the family and the importance of understanding the legal rights of a surviving spouse.
Estate of Thompson [2023] NSWSC 1320: Mark Thompson, a successful businessman, passed away leaving a will that allocated his $8 million estate among his three children from a previous marriage, with only a nominal provision for his second wife, Anna. The will stated that Mark believed Anna was financially independent and did not require further provision. However, Anna, feeling aggrieved by the exclusion, made a family provision claim against the estate.
Anna, emotionally distressed and feeling abandoned, described in court the financial hardships she faced after Mark’s death. She recounted how she had been accustomed to a certain lifestyle during her marriage and now found herself struggling to meet basic expenses. Her voice was filled with a mix of sadness and frustration as she described feeling sidelined and overlooked by her late husband's will. She expressed her desperation to secure a fair share of the estate to maintain her standard of living.
Mark's children, on the other hand, argued that their father had made his intentions clear and that the will should be respected. They claimed that Anna had sufficient means of her own and was attempting to claim more than she was entitled to. Their voices were filled with a mix of anger and disbelief as they recounted their father's efforts to be transparent about his wishes, feeling unfairly targeted by the legal challenge.
The Supreme Court of New South Wales was required to determine whether Anna had grounds for a family provision claim and, if so, how much of the estate should be allocated to her. The legal process included:
The legal battle over Mark’s estate resulted in substantial financial costs. Legal fees and court expenses totaled over $500,000. Additionally, the estate’s assets, including a property valued at $3 million, had to be sold to cover the costs of litigation. The ongoing dispute caused further financial losses due to delays in asset distribution, market fluctuations, and maintenance costs. The total financial impact on the estate exceeded $700,000, significantly reducing the inheritance available to Mark's children.
The Estate of Thompson case underscores the importance of understanding the rights of a surviving spouse in relation to a will. While a will may clearly state the deceased's intentions, the Succession Act 2006 (NSW) provides a legal avenue for a surviving spouse to seek a greater share of the estate if they believe they have not been adequately provided for. Proper estate planning, including open communication with all potential beneficiaries, can help prevent disputes and ensure that the estate is administered smoothly according to the deceased's wishes.
Government Resources:
Non-Profit Organizations:
Seniors Rights Service – Legal Guidance on Spousal Rights
URL: https://seniorsrightsservice.org.au/legal-services/spousal-rights
The Law Society of New South Wales – Wills and Spousal Rights
URL: https://www.lawsociety.com.au/legal-help/wills-and-spousal-rights
Justice Connect – Guidance on Spousal Rights
URL: https://justiceconnect.org.au/resources/guidance-on-spousal-rights
Australian Seniors – Protecting Your Will from Challenges
URL: https://www.seniors.com.au/legal/protecting-your-will-from-challenges
Dying with Dignity NSW – Resources
URL: https://www.dwdnsw.org.au/resources