Wills, Intestacies, Estates and Funerals

Intestacy: The Statutory Order of Inheritance

The Rules

the basic principle is that when a person dies without a will, or leaving a will which disposes of only part of her or his estate, the estate, or that part of it which is undisposed of by any will, is distributed to the next of kin according to rules laid down by statute: Administration and Probate Act ss 44-49N. If there is no next of kin the estate passes to the Territory.

The ACT statutory order follows. Note that the order must be read subject to the comments in Commentary on the Intestacy Rules.

First: spouse and no children

If the deceased leaves a spouse and no children, the spouse is entitled to the whole of the intestate estate. Section 45A provides that where an intestate is survived by both a legal spouse and an eligible partner, the spousal share of the estate is divided according to the length of time the eligible partner lived with the deceased before his or her death. If the eligible partner lived with the deceased continuously for less than five years (immediately before her or his death) the eligible partner will be entitled to share the estate equally with the legal spouse. If the eligible partner lived with the deceased continuously for five years or more (immediately before her or his death) he or she will be entitled to the full estate.

Second: spouse and children

If the deceased leaves a spouse and children, the spouse is entitled:

(i) if the value of the intestate estate does not exceed $150,000, to the whole of the estate;

(ii) if the value of the intestate estate exceeds $150,000 and the deceased leaves one child, to $150,000, interest on $150,000 from the date of death to the date of payment at 8 per cent and one half of the balance;

(iii) if the value of the intestate estate exceeds $150,000 and the deceased leaves more than one child, to $150,000, interest on $150,000 from the date of death to the date of payment at 8 per cent and one third of the balance.

If the value of the intestate estate exceeds $150,000 the children of the deceased are entitled to share equally the balance of the intestate estate remaining after the spouse has been paid his or her share. Again s 45A will mean the spousal share may be split between legal spouse and eligible partner

Third: children (and further descendants)

If the deceased leaves children but no spouse, the children are entitled to share equally the whole of the estate. (Descendants of predeceased children share in what their parent would have taken).

Fourth: parents

If the deceased leaves no spouse or children or further descendants, but leaves parents, the parents are entitled to share equally the whole of the estate.

Fifth: brothers and sisters (and their children)

If the deceased leaves no spouse, children or parents, but leaves brothers and/or sisters (or descendants of predeceased brothers or sisters), the brothers and/or sisters are entitled to share equally the whole of the estate (descendants of predeceased brothers or sisters take what their parent would have taken).

Sixth: grandparents

If the deceased leaves no spouse, children, parents, brothers and sisters, but leaves grandparents, the grandparents are entitled to share equally the whole of the estate.

Seventh: uncles and aunts

If the deceased leaves no spouse, children, parents, brothers, sisters or grandparents, but leaves uncles and/or aunts (or descendants of predeceased uncles or aunts), they are entitled to share equally the whole of the estate (descendants of predeceased uncles or aunts take what their parent would have taken).

Eighth: Territory may benefit

If no-one satisfies this order of distribution, the estate passes to the Territory.

Commentary on the Intestacy Rules

Definition of terms

"Children", "brothers and sisters", "uncles and aunts", "stepchildren", "foster children" and "adopted children"

The word "children" as used above is given a wide sense. where a child of the deceased has died before the deceased, leaving children, those children take equally the share which the predeceased child would have taken had he or she survived the deceased. In addition the children of a predeceased grandchild who would have shared in the estate had he or she survived the deceased are entitled to that share equally. This process continues ad infinitum. In the ACT this principle applies to children and more remote direct descendants of both brothers and sisters and uncles and aunts of the deceased. "Children" also includes adopted children. However, the word "children" does not include stepchildren or foster children. Stepchildren and foster children, therefore, do not share in an intestate estate of their step parent or foster parent.

"Eligible partner" (defined in s 44 of the Administration and Probate Act) means:

someone, other than the spouse of the intestate, who--

(a) was the intestate's domestic partner when the intestate died; and

(b) either--

(i) had been the intestate's domestic partner continuously for 2 or more years when the intestate died; or

(ii) is the parent of the intestate's child, if the child was under 18 years old when the intestate died.

Domestic partner -- is defined in s 169(1) of the Legislation Act 2001 (ACT): "someone who lives with the person in a domestic partnership, and includes a reference to a spouse of the person". The "domestic partner" is entitled to claim family provision and in certain circumstances is entitled on intestacy.

Domestic partnership -- is defined in s 169(2) of the Legislation Act 2001 (ACT): "the relationship between 2 people, whether of a different or the same sex, living together as a couple on a genuine domestic basis".

Value -- "Value" of the estate means net value (after payment of debts) and, where the deceased leaves a spouse, does not include personal chattels, which go to the spouse. Also, the estate does not include property held in joint tenancy. This property passes automatically to the surviving joint tenants.

Relationship of the whole and the half blood

In contrast to the position in New South Wales, in the ACT it is immaterial whether a relationship is of the whole blood or the half blood.

Advancement

In some circumstances a gift by the deceased to any of his or her children within the period of five years immediately before his or her death must be brought into account in ascertaining the entitlement of the children or their direct descendants.

Partial intestacy

The rules governing distribution of the property of a person who dies partially intestate are similar to those laid down for total intestacy.

Ex-nuptial children

The order of distribution applies equally to ex-nuptial children: the position of ex-nuptial children generally is the same as that for children born within marriage: Parentage Act 2004 (ACT) ss 38, 39.

Matrimonial home -- special provisions

The surviving partner is entitled to the intestate's interest in the matrimonial home: Administration and Probate Act ss 49F--49N. In the ACT, if the interest in the matrimonial home is worth more than the partner's interest in the interest according to the normal calculation, the partner is permitted to elect to take the partner's interest in the dwelling house, and does not have to account for the difference: see s 49G(1) "in or towards satisfaction".

If the dwelling house forms part of other assets of the deceased, for example a farm or shop building, the right of the partner to elect to take the deceased's interest in it is exercisable only with the permission of the court.

Examples of how an Intestate Estate will be Divided

Here are some examples of the application of the ACt statutory order: Bear in mind, though, that a successful application under the Family Provision Act (see Family Provision) means the court can vary this order.

First example: An estate of less than $200,000, which does not include any interest in a dwelling house. Total value of the estate is $90,000.

Scenario		Intestacy rules result
(i)	The deceased left a widow and no children	The widow gets the whole estate.
(ii)	The deceased left a widow and three children	The widow gets the whole estate.
(iii)	The deceased, a widower, left three children.	Each child will get a third, i.e., $30,000 each.
(iv)	The deceased, a widower, had three children of whom two are living at his death and one has predeceased him leaving no children.	Each surviving child will get half, i.e. $45,000 each.
(v)	The deceased, a widower, had three children of whom two are living at his death and one has predeceased him. The dead child had two children who survived the deceased.	Each surviving child will get a third, i.e. $30,000 each, and each surviving grandchild will get a sixth, i.e. $15,000.
(vi)	The deceased left a widow and a second eligible partner with whom the deceased had been living for four years immediately before death, and no children.	Both eligible partners share the estate equally.
(vii)	The deceased left a widow and an eligible partner with whom the deceased had been living for six years immediately before death, and no children.	The eligible partner takes the whole estate.

Second example: An estate of more than $200,000, which does not include any interest in a matrimonial home. Total value of the estate is $380,000 including personal chattels valued at $20,000.

Scenario		Intestacy rules result
(i)	The deceased left an eligible partner and no children.	The eligible partner gets the whole estate.
(ii)	The deceased left an eligible partner and one child.	The eligible partner gets: the personal chattels, (i.e. $20,000) + $200,000 (+ interest thereon) + half of the balance, i.e. $80,000 (ignoring the interest). In sum, therefore (ignoring interest) the eligible partner gets $300,000 and the child gets $80,000.