When you have children you may want to ensure they will be taken care of in the event something happens to you. Each parent will have different relationships with each child and various involvement in their lives. When you write your Will you should be clear who is included or excluded to ensure they receive their inheritance.
Choosing Your Executor
Your executor manages and administers your estate, ensuring that the wishes set out in your Will are followed. Usually a spouse or child is appointed to be an executor. In blended families, appointing a trustworthy friend, who can act impartially, might be preferable, depending on your circumstances.
Children as your Beneficiaries
A Will may state that the estate is divided or gifted to ‘my children’. The term ‘children’ can refer to your biological children and adopted children. Parents of blended families should clearly identify who they would like to gift their estate to, considering not only their biological children but also adopted children and step-children.
Not making it clear in your Will which of your children are included could potentially lead to conflicts depending on your family circumstances. To reduce the risk of conflict arising, you should:
- Discuss your Will or your estate plans with all your children;
- Prepare a letter to the executor or a separate written statement detailing your reasons for excluding someone or explaining why different provisions were made for each child;
- Write an explanation in your Will to ensure your wishes are known
Risk of a Family Provision Claim
Each Australian state and territory has its own eligibility requirements for a person to contest a Will.
For example, in Victoria, children including adopted children and step-children are eligible persons. In New South Wales, being a step-child does not of itself make them an eligible person but may still be eligible if they were financially dependent on the deceased.
Moral duty to provide
When a family provision claim is made by an eligible person (‘the claimant’), the court will examine the circumstances of each case taking into consideration factors such as:
- The financial resources and needs of the claimant, including earning capacity and debts;
- How the deceased (financially) contributed to the claimant during the deceased’s lifetime;
- The closeness of the relationship between the claimant and the deceased;
- The size and assets of the estate;
- Other beneficiaries named under the Will; and
- Any explanation in the Will for any provision has been made (or not made) for the claimant
Where a family provision claim is made, it is up to the relevant court to decide if the applicant has been unfairly left out of your Will or not adequately provided for in your Will. When writing your Will, parents of blended families must consider the interests of biological, adopted and/or step-children.
To reduce the possibility of a claim being made, you can consider detailing your reasons for excluding someone in a separate written statement. This statement can be kept with your Will to ensure your wishes are known.