Statutory Wills and the benefits of being a Collingwood supporter

Click here to watch our video on this case.

2015 will not go down as a great AFL season for Collingwood. However for two supporters, their devotion to the Magpies turned out to be a windfall gain. In Bailey v Richardson¹, the Victorian Supreme Court was asked to authorise a proposed Will for Ms Evans, who had lost capacity and was unable to make a Will. This was the first case heard under the new amendments to the Administration and Probate Act 1958 (Act), which changed the earlier Statutory Wills provisions.

Background

Two sisters applied to the Court for a statutory Will be made on behalf of their 90 year old friend, Ms Evans. The two sisters met Ms Evans at a Collingwood match, and over time attended games together and became good friends.

When Ms Evans fell ill, the two sisters continued to visit her, provided her with meals and assisted with other tasks. Ms Evans was treated as part of the sisters’ family and attended their family events such as birthdays and Christmas.

Ms Evans had no immediate family. Her nearest relative was a niece that she had little contact with. Having said this, if Ms Evans died without a Will, the niece would receive her estate under the laws of intestacy that apply when there is no Will.

Under the proposed Will, the two sisters were to be appointed as executors, with the estate to be divided equally between them. As part of the application, an independent lawyer was appointed to try to determine Ms Evans intentions regarding her estate (which provide a difficult task given her lack of capacity).

Role of the Court

Under the new provisions of the Act, the Court must be satisfied of three points before approving a Will:

1. The individual does not have testamentary capacity.
2. The proposed Will reflects the individual’s likely intentions, or what their intentions might reasonably be expected to be if they had testamentary capacity.
3. It is reasonable for the Court, in all the circumstances, to authorise the making of the will.²

To approve or not to approve…

Justice McMillan was assisted by the evidence gathered by the independent lawyer that Ms Evans wanted to leave the two sisters her assets. Her Honour:

• was unable to determine that the proposed Will reflected what Ms Evans’ intentions would have likely been if she had testamentary capacity due to the paucity of evidence;
• but was satisfied  on the balance of probabilities that some reasonable people could think there is a ‘fairly good chance’ that the proposed Will reflects what Ms Evans intentions might be if she had had testamentary capacity.

On these grounds, Justice McMillan determined it was reasonable to authorise the making of a statutory Will in the terms of the proposed Will, and made orders to that effect.

The takeway

Bailey v Richardson is an important reminder that even though a client may have lost capacity to make a Will, there are instances where a Court will authorise a proposed Will. This can provide opportunities in many circumstances, including:

• avoiding the operation of the laws of intestacy which could provide an unwanted result;
• providing certainty on who will act as executors and who will benefit from the estate; and
• potentially allowing for structuring to be put in place, such as testamentary trusts, and the benefits that flow (including asset protection and tax planning opportunities).

The Hall & Wilcox Private Clients Team has extensive experience in complex succession planning issues, including Court authorised Wills, and can assist with any enquiries in this area.

¹[2015] VSC 255
²Wills Act 1997, s21B.