Whilst there is no general rule which dictates the nature and extent of a parent’s obligations to provide for their children in their estate, the Court is required to consider the community expectations when determining the moral obligation owed by the deceased and the extent of provision appropriate.
This will vary in each case but may encompass expectations of parental assistance at crucial lifetime milestones, such as education, setting up for independent living, or at least ensuring that their adult child will have some money set aside for ‘a rainy day’. However, it will not necessarily include an obligation to provide a house or even a deposit on a house for an adult child.
Eligibility
Children are eligible persons to make a claim for provision out of a deceased person’s estate pursuant to section 57(c) of the Succession Act 2006 (NSW (‘the Act’). A court may make an order for provision or further provision for an ‘eligible person’ where satisfied that adequate provision for the proper maintenance, education or advancement in life of the person in whose favour the order is to be made has not been made by the will of the deceased person, or by the operation of the intestacy rules in relation to the estate of the deceased person, or both.
Considerations
The various non-exhaustive matters to which the Court will give consideration when considering a claim by an applicant are set out on section 60(2) of the Act. The more prominent considerations with respect to claims by adult children are set out below.
Financial Need
One of the more important considerations is the extent of the claimant’s financial need. However, this is balanced against the size of the estate and competing interests.
Relationship with the Deceased
The continuity and quality of the relationship between the parent and the child are considered. For example, periods of estrangement will require the Court to examine the circumstances which lead to the estrangement and the efforts made to rekindle the relationship by the claimant or the deceased.
Health of the Claimant
The Court will take into account the adult child’s health conditions or potential health issues particularly with respect to the financial burden on them, their ability to an income and save for retirement, and their future need for medical and allied health care assistance.
Dependency on the Deceased
In determining the deceased’s moral obligation to provide for the claimant, the Court will consider whether the claimant was being maintained, either wholly or partly, by the deceased before the deceased’s death and, if the Court considers it relevant, the extent to which and the basis on which the deceased person did so.
Liability of Another Person to Support the Claimant
As one of the discretionary factors, the Court will give consideration to the financial circumstances of the claimant’s spouse or partner when determining the extent of the provision appropriate in the circumstances, as this will go to financial need. Where that information is not disclosed by a claimant, the Court may permit the issuing of subpoena by the estate to obtain the information.
Case Study
In the matter of Anderson v Hill [2017] NSWSC 1149, the Court dealt with a family provision claim made by an adult son of the deceased, his mother’s estate.
The deceased had remarried George Hill 24 years before her death. They lived in a property at Ermington which George had owned at the commencement of the relationship. After their marriage, George transferred a share of this property to the deceased which they then held as joint tenants.
Upon her death, the deceased left all her assets to George under her will. Since the primary asset, the Ermington Property, was held as joint tenants, it did not form part of her estate upon her death and reverted to George by survivorship without the need for probate.
The claimant, who received nothing under his mother’s estate, sought to claim a share of the Ermington Property by invoking the notional estate provisions under the Succession Act 2006. The Court has the discretion to claw back certain financial and property interests which do not form part of the deceased’s estate where the property was divested (or not brought into the estate) as a result of the deceased’s acts or omission, to satisfy a family provision order.
The court assessed several factors to determine the legitimacy of David’s claim:
- The nature and closeness of the claimant’s relationship with his mother.
- Whether the claimant had lived in the home at any point.
- The financial needs and circumstances of both the claimant and the widower.
- The duration of the marriage and the current and previous wills of the deceased.
The court acknowledged that children from previous marriages may have valid claims against their parent’s estate, even in the context of blended families. It highlighted that the deceased’s minimal provision for the claimant, along with his financial needs and the contributions and needs of the surviving spouse, were crucial in determining the claim. The claimant’s infrequent contact with his mother (visiting only three or four times) was also a significant factor in the court’s assessment. The claim was dismissed with no order as to costs.
Reference: Anderson v Hill [2017] NSWSC 1149 (30 August 2017) (austlii.edu.au)
Conclusion
The Court has a wide discretion in respect to family provision claims, and unfortunately, there are different perceptions between judges of the Court as to what community standards for the expectation of provision for various applicants. There are however important considerations which appear more prominent in the Court’s consideration.
It is important that you engage a lawyer who has extensive experience in family provision claims to ensure you maximise the potential for a good outcome.
DISCLAIMER
This article reflects the current law at the time of publication. It is intended for informational purposes only and does not constitute legal advice. The actual decisions in each case are summarised for general understanding. For specific legal guidance in relation to your situation, please consult with a qualified legal professional.
