What happens if you die without a will in Australia

If your loved one has passed away without a Will tucked away in the drawer and with no executor appointed, you won't be left with any formal instructions to help you determine what happens with their estate. Dying without a Will is known as dying intestate, and this is not an ideal situation, but it's far more common than you think. So, what now?

What circumstances usually lead to a person dying without a Will?

The most common reason people die without a Will is inaction. There are many reasons for this inaction, including:

• thinking that they don't have sufficient assets to justify making a Will
• being fearful of discussing death
• intending to make a Will but simply never getting around to it, and
• being unable to decide what to do in the Will so doing nothing (for example, not being able to decide who to appoint as guardians of children).
   

Other causes of an intestacy include:

• the inadvertent revocation of a Will, for example, by a subsequent marriage
• the loss of the original Will by the Will-maker
• the existence of a Will signed by a person who did not have the capacity to understand what they were doing, or
• failing to prepare a Will properly. This might be caused by not having the document correctly witnessed or forgetting to sign the document.

How is an intestate estate dealt with?

The administration of an intestate estate requires someone to take responsibility to see it through (because no executor of the Will is appointed).

For this reason, an application needs to be made to the court seeking an order to appoint an administrator of the estate. This application is referred to as an application for a grant of letters of administration on intestacy. The most common situations that give rise to an application for a grant of letters of administration are:

• where there is no Will, and
• where there is a Will, but all of the nominated executors are unable to act (because they have either died, have lost capacity or refuse to act). In this scenario, the Will remains valid but an administrator needs to be appointed to administer the estate.
   

In all cases where it is necessary to apply for a grant of letters of administration, it is usually the person with the greatest entitlement to the estate that applies for the grant (because there is no executor appointed who is able to apply for a grant of probate). For example, if a spouse or partner survives the deceased, they would usually bring the application. If the deceased is survived by children (and no spouse) then one or more of them could apply.

A dispute can arise at this point if there are multiple people who all think they should be appointed as administrator. This dispute will need to be sorted out before the administration of the estate can commence.

What is the difference between a grant of probate and a grant of letters of administration?

An application for a grant of probate is made to the court by an executor appointed by a Will. The grant of probate confirms that the Will is valid and that the executor has the authority to deal with the assets of the estate.

An application for a grant of letters of administration is usually made to the court where there is no Will and therefore no appointed executor. In this case, a beneficiary of the intestate estate will apply to be granted the formal right to administer the estate.

How is inheritance priority worked out when there is no Will?

The distribution of an intestate estate is predetermined by a statutory formula. This formula sets out who benefits from the estate and in what proportions (that is, the order of priority).

As expected, a distribution determined in this way can create significant problems. For example, a surviving spouse may end up having to share a substantial part of the estate with children or stepchildren, or part of the estate might pass to relative who had little or nothing to do with the deceased. This is why dying without a Will can be problematic as your estates may not be distributed to the ones who are most important to you.

Do Intestate laws differ from state to state?

Every state and territory in Australia have its own intestate laws and the distribution formula differs between jurisdictions.

Are there any disadvantages to the intestacy process?

Dying without a Will creates uncertainty and is more likely to result in a dispute.

It can cause delay and additional expense if those left behind argue about who is to be appointed as the administrator and whether or not the intestate distribution adequately provides for those people closest to the deceased.

If you or someone you know is dealing with an intestate estate or a dispute caused by an intestate estate, legal advice should be sought to try and resolve the issues as quickly as possible.