What happens if you don't have a Will? - Intestacies

If a will has not been made then a deceased estate is likely to take longer to administer. The personal representative will not be pre-determined by the deceased person. The entitlements for beneficiaries are restricted to being distributed in accordance with a fixed formula. The fixed formula may be quite unacceptable, particularly if the estate ends up with some unexpected assets.

Intestacy arises where a deceased person has not left a will that effectively disposes of all the assets upon death. There can be partial intestacy where the deceased has made a will, which does not effectively dispose of all the property. The relatives of the deceased who are entitled to share determine the distribution of an intestate estate.

A spouse who survives the deceased is entitled to a priority distribution valued at $90,000, plus interest calculated at 11% from the death of the deceased until the date when the amount is distributed. If there is no surviving spouse then this priority distribution is not applicable. The priority distribution of $90,000 may be either in cash or non-cash assets, such as a share in a house. If the estate assets are insufficient to meet the full value of the priority distribution, then obviously the surviving spouse receives all of the estate assets after payment of creditors and the estate administration costs. In addition to the priority distribution, the surviving spouse is entitled to the personal chattels.

Following the priority distribution, the remainder of the estate is shared between other relatives in the following way:

• If there are children and a surviving spouse, then the children get between them two-thirds of the estate assets after the priority distribution and the spouse gets one-third of the assets as well as the priority distribution. Other relatives get nothing. Special provisions apply where the children are minors.
• If there are no children but there is a surviving spouse and there are parents of the deceased, then the parents get between them one-third of the estate assets after the priority distribution and the spouse gets two-thirds of the assets as well as the priority distribution. Other relatives get nothing.
• If there are no children and no parents, but there is a surviving spouse then he or she gets all of the estate.

If there is no surviving spouse, no children and no parents then the brothers and sisters share. If any brothers or sisters have already died, then their shares of the estate may pass to their children (if any) who would be nephews and nieces of the deceased person.

If the relatives are more remote, then the beneficiaries are ascertained by going further up the family tree to see if there are surviving grandparents. If the grandparents are not living then their surviving children (uncles and aunts of the deceased) may inherit the estate, and if these people are not living we may come down the family tree to their children (the cousins of the deceased) or the cousins' children. Once we find surviving relatives then the distributions can be established. If surviving relatives cannot be found at that point we may go back up the family tree to the great-grandparents then down through their descendants to find surviving relatives

If you don't have a will then this is an appropriate time to arrange one. Wills should be regularly revised especially when there is a major asset purchase or a marital status change.

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