Page 16 - Walking the Wire

CASE STUDY
CAREFUL WHAT YOU WILL FOR
Badly drafted wills
SITUATION
Bob died on 2 September, 2020 and his will specified for his assets to be split amongst his three children and wife.
His will was completed in a hurry two weeks before he died, when his capacity was questionable. The assets were split at follows:
z Son one: A property and livestock
z Son two: A property and livestock
z Daughter one: A small property and cash z Wife: Everything else
The will also required that:
z All three children pay out debts on all properties
z The wife was to receive an annuity of $30,000 annually from each child z If all three children did not comply, all the children’s gifts would fail
In the daughter’s case, as mum was only 62, the annuity and debt payments meant it was likely the daughter would ultimately have a debt, not an asset.
WHAT HAPPENED?
All four beneficiaries made Family Provision Applications against the estate. The Applications were made in respect of the failure of the last two wills due to capacity, and the construction of the relevant clause in respect of the conditions on the children’s bequests.
CONSEQUENCES
Costs could potentially exceed well over $3 million between barristers, lawyers, forensic accountants and property valuations.
The estate would pay a significant portion of these costs and it is likely the business will be in severe financial difficulties by the time the matter is finalised.