Estates · Additional Resources

A person who dies and either does not leave a Will or leaves a Will which does not effectively dispose of either the whole or part of their estate is deemed to have died intestate and special legislative rules apply to the distribution of the intestate’s estate. Traditionally, four categories of persons potentially have an entitlement when a person dies intestate:-

  1. A spouse by marriage or a de facto spouse;
  2. Children and grandchildren;
  3. Parents;
  4. Next-of-kin which includes brothers and sisters, grandparents, uncles and aunts, nephews and nieces and first cousins.

In 1998, the Government introduced new legislative provisions significantly reforming the rules relating to intestacy and to the persons entitled to a portion of an intestate’s estate.

Entitlement of Spouses and De Facto Spouses

Where a spouse, either by marriage or a de facto relationship, survives the intestate and the intestate also has children or grandchildren, the base entitlement of the spouse is the household property, $150,000.00 and a percentage of any of the residue of the estate which is also divided between the surviving children and grandchildren. In such a circumstances, the next-of-kin are not entitled to any of the estate.

Where both a spouse by marriage and a de facto spouse survive the intestate, both are entitled to a share of the base entitlement. The base entitlement is divided according to a “Distribution Agreement” as agreed between the two parties. If the parties fail to reach agreement, then a Court will make a “Distribution Order”. When considering who should get what percentage of the base entitlement, the Court considers what is “just and equitable” in all the circumstances. There is no presumption of an equal 50% split. In some cases, this means it may be conceivable that one spouse gets the entire base entitlement and the other spouse is entitled to none of the estate.

Where a surviving spouse, either by marriage or de facto relationship, survives the intestate and there are no children or grandchildren who survive, the spouse is entitled to the entire estate. Previously, the estate would have to be shared with the next-of-kin however, the new reforms remove any entitlement of the next-of-kin in such circumstances. Where two spouses survive the intestate, once again a distribution agreement or distribution order will be required to divide the entire estate.

In conclusion, the Intestacy Rules can be seen as a form of statutory Will aimed at achieving a result which an average person would endeavour to achieve through the making of a Will.

However, the rules even after reform cannot do justice in all the circumstances. The rules cannot distinguish between the deserving spouse and the undeserving, or the loyal child and the neglectful.

While the Intestacy Rules are aimed at achieving a fair, just and equitable outcome, they fail to take consideration of individual circumstances. For this reason alone, every person should see a Solicitor to make a Will in order to ensure their wishes are expressly met and their estate distributed according to individual needs and the specific circumstances of their loved ones.