Understanding some basic aspects about the process of probate and Estate administration can assist you to assess what is required to be done, and to make what can be a very emotionally difficult time a bit easier.
When someone dies, their legal and financial affairs need to be clearly identified and finalised.
Often these matters need to be dealt with soon after the person has died, which is the most stressful time for family and friends.
1. Does an Estate always require probate?
If someone dies leaving a valid Will, a probate application is not necessarily a foregone conclusion.
Many people can avoid the necessity for probate if they structure their affairs so that their assets are held jointly with their spouse or partner. For example, if a husband dies (survived by his wife), and his bank accounts, motor vehicles and real property are held in joint names (as joint tenants), probate will not be required.
TRAP!: If real property is held jointly as tenants-in-common, probate will be required because the deceased’s interest does not naturally pass to the other tenant(s). Real property owned other than as joint tenants will always require probate.
An Estate can also generally avoid probate when there are some solely-held assets of low value, such as small share parcels or bank accounts.
Each institution and share register has its own “cap” as to the value that the asset must reach before it considers that probate is required to transfer ownership of that asset. In our experience, for shares this is often $25,000 (for the share parcel) and for cash it is sometimes higher (around $40,000). It is best to make enquiries early on so that you can provide the right advice and avoid unnecessary expense if probate is not actually needed.
2. What is involved in preparing a probate Application?
The complexity of a probate application will depend on the number and type of assets that the deceased had at the date of death.
The Supreme Court Probate Scale of Fees (SA) is based on the net value of the Estate – this is appropriate because, generally speaking, the complexity of the Estate will increase as the net worth of the deceased increases (i.e. a $4 million estate is usually more complex than a $400,000 estate). In our view, the Scale of Fees is actually quite generous for high-value Estates. We can often obtain probate for a fee below this scale.
To prepare a probate application you will require the following documents:
- Last Will (original);
- Death Certificate (original);
- Records of all assets of the deceased, including:
- Bank statements;
- Share dividend statements;
- Superannuation fund statements;
- Certificate of Title of property(ies);
- Registration papers of motor vehicles; and
- Copies of any relevant agreements whereby the deceased is owed money (loan agreements, mortgages, etc); and
- Records of all debts/liabilities of the deceased, including:
- Mortgage statements;
- Copies of any relevant agreements whereby the deceased owed money to someone else;
- Outstanding bills (outstanding as at date of death); and
- Funeral expenses.
The original Will and Death Certificate are submitted with the Application, and the Court retains these documents. The issued grant is evidence of death and testamentary wishes.
A probate application consists of 4 core documents:
- Draft Probate;
- Executor’s Oath;
- Affidavit of Assets & Liabilities (with Statement of Assets & Liabilities annexed); and
- Registrar’s Certificate(s)
Every document is submitted with a backsheet, with text aligned to the right of the page. This is effectively in lieu of a Form 1, and so it contains the name of the Estate, the name of the document and the submitting solicitor's details.
Other documents that may often be required as part of the Application are:
- Affidavit of Alias (if the deceased’s name was misspelt on the Will or if the deceased used multiple names or versions of their name);
- Affidavit of Plight and Condition (if the Will has been altered from its original form – i.e. a staple removed); and
- Affidavit as to Due Execution (if there are any questions as to the validity of the Will or the testamentary capacity of the deceased - this affidavit will usually be required for estates that have been caveated)
TIP!: It is important for Executors not to make any alterations or cause any damage to a Will. Something as simple as the removal of the staple or other binding for the purposes of making copies of a Will needs to be explained when applying for probate – which takes more time and costs more money.
3. What happens when the Will contains an error?
Occasionally, testamentary documents (e.g. Wills) will contain errors. This happens most commonly when there are multiple codicils, or when the Will is not prepared by a lawyer.
Smaller issues (such as name misspellings, incorrect addresses, etc) can be dealt with by sufficient but brief explanation in the probate application. However, errors that affect the gifting under a Will (i.e. that “muddy” the testamentary intentions of the deceased) require correction.
The process of correcting a Will is called ‘rectification’. It is an additional application that tends to be submitted either at the same time as the probate application or prior to the probate application (generally just depending on the nature of the error being rectified).
A rectification application usually consists of 3 documents, but this may vary depending on the circumstances. These are:
- Summons Without Notice (see the attached precedent for an example);
- Affidavit of the executor; and
- Re-engrossed Will (incorporating the proposed amendments).
The purpose of the Executor's affidavit is to explain the reason why the amendment is sought, and to provide any evidence that the proposed amendment is intended to give effect to the testator's true intentions.
If the error was a drafting or formatting error by a lawyer, it will be necessary to have the lawyer swear an affidavit to support the rectification application. Exhibited to this affidavit will generally be copies of the lawyer's notes (taken whilst preparing the Will) and any draft versions of the Will that are relevant or helpful to the Application.
If a lawyer was responsible for the error, the lawyer or LawClaims may be responsible for bearing the (reasonable) cost of the application.
4. What happens if the deceased died intestate (i.e. without a Will)?
If the deceased died intestate, an application of Letters of Administration (not probate) is made.
The main difference is that an application for letters of administration requires an additional document called a surety's guarantee. This is in the form of an affidavit given by the sureties. No money is expected to change hands at this stage - it is just a guarantee to pay money if later required. The purpose of the surety's guarantee is to give the beneficiaries of the estate assurance that the administrator will do a proper job.
The role of Administrator is determined by relationship to the deceased, in the following order:
- Spouse/partner;
- Child (if adult);
- Mother/father;
- Brother/sister;
- Grandparent; and
- Uncle/aunt/niece/nephew.
In the alternative, someone may nominate themselves as Administrator, and this is usually possible as long as people with a higher priority agree to the nominated person's assumption of the role.
5. What can we expect when doing a probate Application?
The main concerns we find clients have in relation to probate are:
- What are they expected to do;
- What are the costs; and
- How long will it take to get probate?
We aim to keep the process relatively smooth by telling you what documents we will need at the start, so you have time to think about where those documents are, and what additional enquiries you need to make to complete the application.
We also clearly itemise the costs. This includes the unavoidable application fee of $995 (up from $841 last year!). Clients often ask us how they can keep costs down for the preparation of the Application. Getting the documents to us quickly and in one go will help keep costs down, as will sorting them into an order that makes some sense.
We also get asked how long probate takes to get. This will depend on two factors – one is in your control (your preparation of the application), the other outside of your control (the Court's timeline for processing).
- Dealing with the factor in your control: We find that about a week is the shortest turnaround for probate from preparation to lodging with the Court. Remember that you must swear the relevant affidavits in the application. It is also important that you do not make any errors in the Application because this will result in the Application being rejected, and the clock starting again. As an indication, each requisition from the Probate Registry will set you back an additional 2-4 weeks.
- Handling the factor outside of your control: The turnaround time from the Courts varies depending on how big the backlog of applications is at any point in time – it tends to fluctuate between 3-8 weeks. It is a good idea to telephone the Probate Registry to get an update on what the processing time for grants is at that time.
If you would like our assistance in applying for probate or Letters of Administration, call us on 1300 654 590 or email andrew@adlaw.com.au.
