One of the most important things a person can do is to have a valid will. However, death can occur unexpectedly and if there is no valid will, the estate will be distributed in accordance with the intestacy rules.
Before exploring the intestacy rules, it should be noted that this piece is only a broad introduction, and that the laws may differ between the states and territories of Australia.
How will the estate be distributed?
Generally speaking, a statutory order may result in the division of the estate between eligible relatives of the deceased. The eligible relatives may be split between spouses and other relatives. If a person who dies without a will is an Indigenous Australian, the statutory order may be subject to exclusion or modification under the relevant provisions.
In the event that the person who is deceased has a spouse but no children, the spouse may be entitled to the whole estate of the deceased.
If the deceased leaves both a spouse and children behind, and the children are the children of the spouse, it is the spouse who may be entitled to the whole estate.
Using the Succession Act 2006 (NSW) (the Act) as our statutory example, if the deceased leaves behind a spouse and children, but the children are not the children of the spouse, the spouse may be entitled to:
- the personal effects of the deceased;
- a statutory legacy of a statutory amount, adjusted for CPI plus interest;
- one half of any remainder.
In the event that the deceased had multiple spouses, there may be another set of considerations in how the estate is to be distributed.
How is spouse defined?
The entitlements of the estate for a spouse of a person who has died intestate are quite significant. Therefore, it is important to understand who is defined as a spouse under the law.
Using the New South Wales Act again as our legislative example, a spouse is a person who was married to the deceased immediately before death or who was a party to a domestic partnership immediately before death.
Relationships which are recognised as a domestic partnership, can be a relationship that involves an interstate relationship that is a registered relationship, or an interstate registered relationship, or a de facto relationship.
In order for a de facto relationship to be recognised for the purposes of domestic partnership, the relationship must meet the following criteria:
- the relationship has been in existence for a continuous period of two years; or
- the relationship has resulted in the birth of a child.
Generally speaking, if the deceased had only one spouse, they may possess the preferential right to acquire property from the estate. However, if there were multiple spouses, then the preferential right may not be applicable and in such instances, it’s probably a good idea to seek the assistance of a lawyer.
How is the estate distributed if there is no spouse?
If the deceased had no spouse, the order in which the estate may be distributed can be as follows: children, parents, brothers or sisters, grandparents, aunts or uncles, and cousins.
If the deceased had no spouse, the first relative who generally would receive the benefit of the estate would be any children. However, the question of who is considered a child in statute can potentially be far reaching and can include:
- any children conceived through in vitro fertilisation (IVF);
- adopted children, which can also include children adopted by same sex couples.
Due to the fact that a child of the deceased can encompass a wide range of classes, it’s important to seek the assistance of a lawyer who will be able to assist.
What if the deceased had no relatives?
If the deceased has died intestate without any relatives, and there are no relatives closer than second cousins, then the estate will pass onto the State.