COVID-19 - Updates, Webinars and Resources

Do you need help with Probate?

Our expert legal team is ready to take your call

Mitchell is the Managing Principal of Sharrock Pitman Legal. He is an Accredited Specialist in Commercial Law (accredited by the Law Institute of Victoria). He also deals with areas of Employment Law, Wills & Estate Planning and Probate and can answer all your questions related to probate.

For further information, contact Mitchell on his direct line:


CALL: (03) 8561 3318

Superannuation is a major asset for many Australians. As our population ages and we are seeing more and more people working beyond the age of retirement, the monetary amount of one’s superannuation account is naturally increasing.

Along with this increase also comes the issue of disputes arising between family members as to superannuation funds and how decisions are made regarding superannuation monies and its distribution as part of a deceased estate.

This article will discuss the nominations available to members of superannuation funds and ways to best avoid disputes between beneficiaries for death benefits and final distributions.

Superannuation Nominations

There are generally two types of nominations: binding and non-binding.

Binding Nominations

These involve nominating specific beneficiaries to directly receive benefits upon the death of the fund member. The trustees of the superannuation fund must follow this nomination, unless the nominated person is not able to receive such payment, for example, they are prohibited under the funds rules or by legislation.

Usually, binding nominations will be valid for 3 years from the date of signing, so it is imperative that you ensure your nominations are up to date with your superannuation fund.

Non-Binding Nominations

These involve making a nomination which provides a superannuation fund with the opportunity to consider your wishes and ultimately the fund retains the power to distribute any benefits as it considers appropriate in the circumstances.  For example, a family member might lodge a claim for payment of the death benefit amount.

What if there is no Nomination in place?

If there is no nomination made by the member, then the superannuation fund will make a decision in accordance with legislation and its own fund rules as to how to distribute the benefits payable. The fund may distribute the benefits to:

  • a surviving spouse;
  • a dependent;
  • an interdependent;
  • the deceased’s estate; or
  • a combination of these persons.

Isn’t Superannuation covered by my Will?

Superannuation is not considered part of a deceased person’s estate, as it is not held by the individual themselves – rather the superannuation fund holds it on trust for the individual. Therefore, it is not automatically captured by the terms of your Will.

There is no requirement for a superannuation fund to distribute any benefit in accordance with the terms of a Will. The fund may consider the terms of the Will in its decision making process, however it is not something it is bound to consider. This makes the Nomination document so critical.

Challenging a decision made by the superannuation fund trustee

Although all super fund trustees must act in good faith and make responsible and reasonable decisions, there have been many cases where decisions regarding estate distributions are disputed.

Some examples of situations where disputes arise include:

  • Where the deceased was married and not yet divorced, but had a de facto partner at the time of their passing;
  • Where there are competing claims between children as to proportionality;
  • Where a beneficiary requires greater provision due to health or financial concerns;
  • Where there are blended families (step-children and step-parents);
  • In circumstances where the actual form or content of the nomination that was in place is questionable;
  • Where the decision making process undertaken by the superannuation fund trustee is questioned by affected persons; and
  • In circumstances where there was been no, little or inadequate estate planning undertaken by the deceased.  

If you believe that a superannuation fund has paid a benefit to the wrong person, or that you are entitled to a larger proportion of the benefit, then you are entitled to seek an internal review with the relevant superannuation fund within 28 days of being notified of the trustee’s original decision.

There is generally no fee payable to the superannuation fund for such a review to occur. We recommend that, to put your best case forward, you engage the services of a legal practitioner to advocate on your behalf. We would then provide the trustee with all the relevant information, including a timeline of events (if applicable), declarations as to the nature of your relationship with the deceased, and certified copies of any supporting documentation where relevant.

What if the trustee upholds their original decision?

If you are dissatisfied with the response from the superannuation trustee, you are entitled to apply to the Australian Financial Complaints Authority (‘AFCA’) within 28 days of receiving this response.

AFCA is a free service. It is an independent body that works with parties through dispute resolution processes (such as negotiation and conciliation) in matters regarding financial services and products. AFCA is bound by the governing rules of the relevant superannuation trust and the Australian legislation, therefore, it cannot reach a decision that is contrary to the terms of the superannuation fund itself. There is no need for legal representation when dealing with AFCA, but if you would like a professional advocate to deal with the matter on your behalf, we would be happy to assist.

If the resolution process at AFCA is not to your satisfaction, the decision made by the superannuation trustee can be appealed in the Supreme Court of Victoria.

How to avoid these disputes

The best way to avoid leaving your loved ones with a superannuation dispute is to ensure that you have an effective nomination in place with your fund. These binding nominations are free to complete and can reduce the risk of challenges regarding your superannuation. If you would like some assistance with planning for your superannuation or estate planning generally, we would love to speak with you and provide you with advice and guidance. Please feel free to contact our Wills and Estates team on 1300 205 506 or alternatively fill in the contact form below.

The information contained in this article is intended to be of a general nature only and should not be relied upon as legal advice. Any legal matters should be discussed specifically with one of our lawyers.

Liability limited by a scheme approved under Professional Standards Legislation.

Written by one of our lawyers

,

.

Caroline Jeanne

For further information contact

Caroline Jeanne

Caroline is a Legal Practitioner at Sharrock Pitman Legal.

She is part of our Wills and Estates group and deals with Wills and Estate Planning and Probate. For further information, contact Caroline on her direct line (03) 8561 3322

More on

Wills & Estate Planning

However, in this article we will set out the factors that influence how long it will take to obtain a Grant of Probate and to administer an estate in Victoria.

The basics

First things first: what is a Grant of Probate? A Grant of Probate is effectively a document issued by the Supreme Court of Victoria which formally authorises an executor to manage the estate of a deceased person in accordance with their Will. Without Probate, the asset holders (say a bank or share registry) cannot be satisfied as who has the correct authority to receive the deceased's assets and may refuse to pay out.

Sometimes, for smaller estates or if assets are mostly jointly owned with a surviving spouse, asset holders might agree to release payment without requiring a Grant of Probate. This is usually on the basis that the person who receives payment promises to repay (or Indemnify) the asset holder if it turns out they paid to the wrong person.

If there is no Will, then you cannot obtain a Grant of Probate. Instead you obtain Letters of Administration. This is effectively the same, in terms of authorising someone to administer the estate, and would usually be obtained by the person who is the closest next-of-kin to the deceased.

“A Grant of Probate is effectively a document issued by the Supreme Court of Victoria which formally authorises an executor to manage the estate of a deceased person in accordance with their Will.”

Timeframes for Probate in Victoria

In order to obtain a Grant of Probate, the Court needs to be given information about the assets and liabilities of the estate, the deceased person, the witnesses to the Will, the executors and the Will itself. An advertisement of your intention to apply for Probate must also be placed on the Supreme Court website for at least 14 days prior to any application.

Often, making enquires to obtain all the necessary information can take a number of weeks. Also, you will need the Death Certificate for the application for Grant of Probate and possibly for making proper enquires regarding the assets and liabilities. Waiting for the Death Certificate to issue can therefore add a few more weeks to the process. Overall, if you have your application for Grant of Probate lodged within 1 to 2 months from the date of death, you are making timely progress.

The Court itself does not take long to process the application (maybe another 1 to 2 weeks) and this is done 'on the papers'. This means you do not have to go to a court hearing. There is also a general discretion for the Court to issue a 'Requisition' asking that you provide more information before they process the application and this can delay matters.

“Overall, if you have your application for Grant of Probate lodged within 1 to 2 months from the date of death, you are making timely progress.”

So, here we are a few months after death and you finally have a Grant of Probate. It is important to remember that this is the start of the estate administration and not the end. For a very simple estate, you might only need a further month or so to cash the assets and pay them to the correct beneficiaries. However, it can often be more complex than that. Factors that determine the timeframe to administer the estate include:-

  • Some assets will take time to cash or transfer. For example, if selling a property, final settlement might be 60/90/120 days from the day of sale.
  • There is a 6 month period for challenges to be brought against the estate and executors must wait until this period expires before distributing the estate, if there is any risk that a disgruntled family member might come forward.
  • There might need to be final tax returns for the deceased or for the estate. Failing to wait for the ATO to process these could leave the executor personally liable for a tax bill.
  • You might need to advertise for creditors to come forward and wait for a period of months while this advertising timeframe expires. This protects the executor if they are unsure of all of the deceased's financial dealings and creditors.
  • It might not always be a good time to immediately cash estate assets. For example, the shares just took a nose-dive, do you still sell regardless of available price?

There is a general rule that executors have an 'executor's year' to complete the estate administration. This means that you should be aiming to have the estate finalised and distributed within 12 months from the date of death.

The information contained in this article is intended to be of a general nature only and should not be relied upon as legal advice. Any legal matters should be discussed specifically with one of our lawyers.

Liability limited by a scheme approved under Professional Standards Legislation.

Need help with Probate?

Our expert legal team is ready to take your call!

Mitchell is the Managing Principal of Sharrock Pitman Legal. He is an Accredited Specialist in Commercial Law (accredited by the Law Institute of Victoria). He also deals with areas of Employment Law, Wills & Estate Planning and Probate and can answer all your questions related to probate.

For further information, contact Mitchell on his direct line:

DIRECT LINE: 
(03) 8561 3318

Download our FREE legal guide to Probates & Estates in Australia

GET YOUR FREE DOWNLOAD

Enter your details

Thanks for your interest! 

Here's your download:
DOWNLOAD PDF
Oops! Something went wrong while submitting the form.

Could your business do with a “health check”?

Fill in our survey about the legal health of your business and get 30 minutes FREE legal advice!

FILL OUT SURVEY NOW

Could your Not for Profit organisation do with a "health check"?

Fill in our survey about the legal health of your organisation and get 30 minutes FREE legal advice!

FILL OUT SURVEY NOW

About Sharrock Pitman Legal

For fifty years Sharrock Pitman Legal has made a significant and long term contribution to meeting the legal needs of business owners and residents in the City of Monash and greater Melbourne area.