Ensuring that your assets are properly secured and documented in your will is crucial for a smooth estate administration process. Failing to account for all assets can lead to unintended consequences, disputes among beneficiaries, and significant legal costs. This article explores the essential steps to secure and document assets in a will, with a focus on best practices and legal considerations.
Identify and List All Assets
The first step in securing assets in a will is to create a comprehensive list of all assets, including real estate, bank accounts, investments, personal belongings, and digital assets. It's important to detail the location, ownership status, and value of each asset. Executors are responsible for gathering this information, often requiring searches of the deceased's documents, emails, and financial records.
Ensure Proper Documentation
Proper documentation is essential to prove ownership and ensure assets are included in the estate. This includes obtaining certificates of title for real estate, share certificates for investments, and any relevant trust deeds or partnership agreements. Executors should also secure access to digital assets, such as online accounts and cloud storage, to prevent unauthorized access and ensure they are included in the estate.
Protect and Secure Assets
Once assets are identified, it is the executor's responsibility to protect and secure them. This may involve changing locks on properties, securing valuable items in safe storage, and ensuring all assets are adequately insured. Executors should also be mindful of assets that may require special care, such as artworks or antiques, and take steps to prevent their deterioration or loss.
Documenting Special Considerations
Certain assets, such as superannuation, jointly owned property, and assets held in trusts, may not automatically be distributed by the terms of a will. It's important to address these in the estate plan to ensure they are distributed according to the deceased's wishes. Executors should work closely with legal professionals to navigate the complexities of these assets and ensure they are properly documented in the will.
The following table provides an overview of the main classes of assets, detailing how to document and secure each type:
| Asset Class | How to Document | How to Secure |
|---|---|---|
| Residential Home | Certificate of Title, Mortgage Documents | Change locks, ensure insurance is up to date, secure property from unauthorized access |
| Investment Properties | Certificates of Title, Lease Agreements | Change locks, secure tenants, ensure rental income is properly managed |
| Shares | Share Certificates, Brokerage Account Statements | Secure documents, use a safe deposit box, ensure accounts are monitored regularly |
| Superannuation | Superannuation Statements, Beneficiary Nomination | Ensure beneficiary nominations are current, store statements securely |
| Car | Registration Documents, Insurance Policies | Store in a secure location, ensure insurance is up to date, keep keys secure |
| Pets | Veterinary Records, Ownership Documents | Arrange for care, ensure pets are not neglected, secure relevant documentation |
| Boats | Registration Documents, Insurance Policies | Secure in a marina or locked storage, ensure insurance is up to date |
| Overseas Property | Foreign Property Deeds, Tax Documents | Liaise with local legal representatives, ensure property is managed and secured |
| Trust | Trust Deeds, Beneficiary Information | Secure trust documents, ensure trustees are aware and capable of managing the trust |
| Business | Business Registration, Financial Statements | Ensure continuity of business operations, secure key documents and contracts |
Background of the Case
In the case of Re Estate of Thompson [2021] NSWSC 1287, John Thompson, a wealthy businessman, passed away suddenly, leaving an estate valued at AUD 12 million. His estate included a luxury home in Sydney’s Eastern Suburbs, a portfolio of investment properties, shares in various companies, and significant cash deposits. John’s will named his two adult children, James and Alice, as executors of his estate. However, due to a lack of communication and inaction, the estate was not properly secured following his death, leading to substantial losses.
Behaviour of the Participants
James, overwhelmed by his father’s sudden death, struggled with the responsibilities of his executor role. He delayed taking steps to secure the family home, leaving it unattended and vulnerable. Meanwhile, Alice, who lived overseas, felt helpless and frustrated by her brother’s inaction. She urgently communicated her concerns, expressing fears of potential theft and damage, but her pleas were largely ignored due to their strained relationship and differing opinions on handling the estate.
As weeks turned into months, tensions between James and Alice escalated. Alice, desperate to protect her father’s legacy, sought legal advice and threatened court action to compel James to act. James, feeling cornered and emotionally drained, continued to resist, believing Alice’s demands were excessive and unwarranted. The situation became more fraught with each passing day, straining their relationship and clouding their judgment.
Legal Process and Court Involvement
Due to the prolonged inaction, several issues arose:
The court reviewed the case and found that James had failed to perform his duties as an executor by not taking adequate steps to secure the deceased’s assets. As a result, the court appointed an independent administrator to manage the estate to protect its remaining value and facilitate proper administration.
Financial Consequences
The financial repercussions of failing to secure the assets were substantial:
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