Estate Planning

Wills

BookA Will is a document made by a person to:

  • Appoint someone of their choice as Executor to administer their Estate after death, and
  • Dispose of all their real and personal property after death.

There are formal legal requirements for a Will to be valid:

  • the person making the Will must be over 18 years of age;
  • the person must be of sound mind;
  • the Will must be in writing and be clearly identified as the person’s Will;
  • the Will must be signed by the person making the Will in the presence of two witnesses who are over 18 years of age and who are not beneficiaries; and
  • the person making the Will and the witnesses must all sign in the presence of each other.

You can include in your Will details of your funeral, burial or cremation, whether you want to donate your organs and you can appoint a guardian for your infant children.

Why Make a Will?

When you make a Will, you decide who benefits from your Estate when you die and who you would like as the Executor to carry out your wishes.

What if you die without a Will?

If you die without leaving a Will, or the Will you have left is invalid, you will have no choice as to who shares in your estate. Instead, the distribution of your estate is determined by intestacy laws.

Somebody, usually a relative, is required to apply to the Supreme Court for Letters of Administration so they can administer the deceased’s estate in accordance with the law. This is often a more complicated and costly process than applying for Probate of a Will.

A common understanding between spouses is that when one dies, they will leave everything to the other partner. Depending on the size of the estate and whether any other family members survive the deceased, this may not be the case under current intestacy laws. If the deceased is survived by a spouse and other close relatives, such as children, parents or siblings, the spouse may not be entitled to the whole of the estate. The amount the spouse receives varies depending on which relatives survive the deceased.

When should you update a Will?

You should review your Will:

  • every three to five years; or
  • when there is a change in your family or personal circumstances, for example:
  • Marriage, divorce or separation;
  • Birth or death of family members;
  • When you establishment of a Trust or where you become trustee or appointor of a Trust;

If the Will still reflects your wishes, nothing needs to be done at this time.

In all Australian States if you marry your Will will become invalid unless you have made your Will in contemplation of marriage.

If you reside in Western Australia, your Will becomes invalid when you divorce with regards to property owned in Western Australia. Your Will may continue to be valid in other states and countries with regard to the property you own there. Therefore, we recommend you make a new Will after your divorce.

Who is the Executor?

Generally, a person will appoint someone in their Will to be the Executor of that Will. Sometimes that person may appoint more than one person or even an organisation such as their accountants, lawyers or a trustee company to be their Executor. You can also provide for substitute Executors if your first choice is not able to act.

The person or persons you appoint as an Executor must be over 18 years of age. The Executor can also be a beneficiary of the Will.

We recommend that you check that the person you wish to appoint as Executor is willing to be your Executor before you name them in your Will.

What does an Executor do?

The duties of an Executor include:

  • Locating the original signed Will, ensuring that it is the latest Will and they are named in that Will as Executor;
  • Checking whether there are any special instructions in relation to the body of the deceased;
  • Making the arrangements for the funeral, although the executor will normally consult with the family about these arrangements;
  • Ascertaining what assets and liabilities the deceased had;
  • Depending upon the value and type of assets, obtaining a Grant of Probate from the Supreme Court;
  • Paying funeral expenses, debts and Will administration expenses out of the estate;
  • Establishing trusts for certain beneficiaries. This money will need to be invested as authorised in the Will or by law;
  • Finalising taxation matters.
  • Distributing assets to entitled beneficiaries in accordance with the Will;

The Executor may need to obtain legal and/or accounting advice in carrying out your duties as executor. Generally, this would be reimbursable from the estate.

Enduring Power of Attorney (EPA)

An Enduring Power of Attorney (EPA) allows you to nominate one or two persons (called attorneys) to have the authority to manage your financial affairs on your behalf. The attorneys must be over 18 years old and have full legal capacity.

You can choose to have your EPA come into effect on the day your attorney accepts his or her appointment as your attorney, or at a later date when you become incapable of managing your own affairs.

An EPA is only valid during your lifetime, and ceases to be operative when you die.

EPAs are useful to have in many circumstances, such as:

  • in the event you have an accident or illness which suddenly makes you mentally incapable, such as a stroke or brain damage;
  • you develop a condition such as Alzheimer’s Disease or Dementia and lose your mental capacity;
  • if you go away on an overseas holiday and you need a person at home to handle your financial affairs;
  • if you have mobility issues and you need someone to physically assist you with carrying out your financial affairs.

Because of the power they potentially have over your financial affairs, you should always be careful to appoint someone you know and trust to be your attorney.

An EPA does not empower your attorney to make health or lifestyle decision on your behalf.

Enduring Power of Guardianship (EPG)

An EPG is a document which appoints 1 or more persons of your choice to make decisions about your health care and lifestyle if you are not able to because you are suffering incapacity.

The appointed guardians, who have to be over 18 years old and have full legal capacity, can make choices about your health care and lifestyle when you are unable to do so, such as if you are unconscious or are suffering from dementia or lack mental capacity.

If you appoint more than 1 guardian then any decisions made by the guardians will need to be unanimous.

Your guardians would have the power to make choices including matters such as:

  • where you live;
  • the dental treatment you will receive;
  • whether you have surgery;
  • whether you are put on life support;
  • whether you work; and
  • with whom you can associate with.

In your EPG you can decide to limit the functions that your guardian may perform or the circumstances in which your guardian may act. You can also provide directions about how your guardian is to perform their functions.

Your guardian will not be able to vote in any election for you, change your Will, consent to an adoption or the marriage of a person under 18 years old or make decisions about property and financial matters.

If you wish to appoint someone to deal with your financial and property matters you will need to prepare an Enduring Power of Attorney, in which you can appoint 1 or 2 persons with provision for substitutes, to deal with these matters (see above).

Any decisions about dental, medical or surgical treatment are subject to any Advance Health Directive which you may have prepared. If you have an Advance Health Directive and the terms of the Advanced Health Directive apply to your circumstances, your guardian cannot consent to or refuse treatment.

Advance Health Directive (AHD)

An Advance Health Directive (AHD) provides your instructions as to the medical, surgical or dental treatment or other health care including palliative care you wish to receive or not to receive in specified circumstances.

This document comes into effect only when you are unable to make reasonable judgments about treatment you might wish to have in certain circumstances.

In this document you can nominate a number of circumstances and the treatment, if any, you wish to receive in those specified circumstances. You can consent or refuse consent to the commencement or continuation of any treatment.

By executing an AHD and nominating your treatment in advance, you can relieve your loved ones of having to make this decision. Also, if your wishes are different to those of your loved ones, your wishes will prevail.

Why Pay a Solicitor to draw up your Will, EPA, EPG or AHD?

The Will, Enduring Power of Attorney (EPA), Enduring Power of Guardianship (EPG) or Advance Health Directive (AHD) is prepared to reflect your instructions and, in your Will, your choice of Executor.

If the Public Trustee and/or private trustee companies draw up your Will or EPA, there is no upfront charge or a minimal fee if you appoint them as your Executor or Attorney.

When you die, the trustee company administers your Estate and is paid a commission or fees to do so, at the expense of your estate and ultimately the beneficiaries. The commission is calculated as a percentage of the gross value of your Estate, regardless of how simple the administration of your Estate might be.

If you become incapable and your EPA came into effect, then the Public Trustee if appointed by State Administrative Tribunal (SAT) would charge fees to administer and manage your estate.

Even if your nominated Executor or Attorney seeks assistance from a lawyer to administer your Estate, the fees charged relate directly to the actual work required, and is not a percentage of the value of the Estate. Fees will usually be considerably less than the amount a trustee company would take as commission. Also, it is the Executor’s or Attorney’s choice whether or not to engage a lawyer or the extent they do so eg. they may only engage a lawyer to make the application for Probate and then administer the Estate themselves.

Many people use Will, EPA, EPG or AHD forms or kits to draw up their own documents. Whilst this may seem to be less costly, if the Will, EPA, EPG or AHD isn’t properly prepared, it could lead to increased costs, delay and anxiety for family members trying to remedy the problems.

Having a Will, EPA, EPG or AHD prepared by an experienced lawyer will give you peace of mind that your family won’t have unnecessary problems after you die or become incapable.

What does Kroon Legal class as a simple Will?

A simple Will is a Will that provides for an entire estate to be left to a person or persons collectively as a group, and in the event of that person or persons dying beforehand, then to their children (if any). Wills incorporating many specific gifts, life interests, special trusts and provisions concerning businesses, companies or family trusts are not simple Wills.

Our solicitors will advise you whether your Will is a simple Will when taking your instructions.

Where I can I store my Will and other important documents?

Kroon Legal provides a free safe custody facility for our clients to store their Wills and other important documents.  Clients who choose to leave their Wills, EPA’s, EPG’s and AHD’s prepared by our office, in our safe custody facilities we will receive copies or certified copies of those documents to you to take home for your records.