Probate in NSW

Applying for Probate

Probate is a court order which confirms that the will is valid and that the executors have the right to administer the estate. Before applying for Probate an intention to apply for probate must be published on the Supreme Court of NSW’s website. Fourteen days later, an application for Probate can be made by lodging the right forms at the Probate Registry of the Supreme Court. The following must be lodged:

  1. Proof of death (e.g. the death certificate)
  2. The inventory of property
  3. An executor’s affidavit
  4. The original will

Basic requirement s for a grant of probate in NSW

For an application for probate to be granted in NSW pursuant to ss 40, 40A of the Probate and Administration Act 1898 (NSW)(“PAA”) there must be:

  1. A deceased person;
  2. The will of a deceased person; and
  3. Property located in NSW.

Once the grant is made the will and grant become public records and copies of certain of the records can be obtained.

When to apply for probate

An application for probate must be made where the testator owned real property or certain other substantial assets not held in joint tenancy. With assets held in joint tenancy (either in personal or real property), the right of survivorship gives the joint tenant/s the right of ownership. It is therefore not necessary to apply for probate when the deceased only held property as a joint tenant, and the other joint tenant/s are still alive.

What you need to know when applying for a grant of probate

  1. Is there another will? The will admitted to probate must be the testator’s last will.
  2. Is the executor willing and able to act?
  3. What assets were held by the deceased? The solicitor will need to prepare an inventory of assets to be annexed to the application for probate.
  4. What are the known liabilities? The solicitor will need to ascertain the liabilities of the deceased, and distinguish between secured and unsecured liabilities.
  5. The details of the beneficiaries must be known, as well as any other eligible persons who might wish to make a claim on the estate.

Who is an executor?

An executor is the person appointed by the will to administer the estate. Put simply, their role involves making sure the debts are paid and that the assets and possessions go where the deceased wanted them to. Usually, people name just one or two executors in their will, but technically they can name as many executors as they like. To make sure the whole process runs smoothly a lot of people choose to name a solicitor as one of the executors, who usually charge a fee for their expertise in administering estates.

Procedure for applying for a grant of probate

The procedure for applying for probate is set out under Pt 78 of the Supreme Court Rules NSW as follows:

  1. An intended application for probate will be advertised pursuant to rule 10.
  2. A summons is then to be filed in proper form containing the details of the deceased, the will, assets, and liabilities etc.
  3. An affidavit of the executor is to be filed with the Death Certificate of the deceased annexed.
  4. The will is then to be filed as a standalone document.
  5. The executor and witnesses should sign the above documents.

Steps for applying for a Grant of Probate

  1. Obtain instructions

The solicitor must obtain instructions from their client. This includes identifying details of the deceased’s estate, and the value of any assets and liabilities both inside and outside the relevant jurisdiction.

 

  1. Draft the appropriate documentation

The solicitor will then need to draft the appropriate probate documentation. This includes:

  1. Advertising the notice of intended application for probate. In NSW the legal notice must be published online, and the executor must wait 14 days after publication before making an application.
  2. Preparing an application/summons/original motion. An application must be prepared and lodged with the Court (but does not need to be served unless the court orders it). Where a legal notice is published, the application should agree in all material respects with the legal notice.
  3. The applicant or his or her solicitor should sign the application. An affidavit must be prepared for and signed by the Executor to accompany the application for the Grant of Probate.
  4. Preparing an affidavit of the applicant/executor and the inventory of assets and liabilities. The assets and liabilities must be disclosed, either within the Executor’s affidavit, or separately (depending on the jurisdiction).
  5. In all jurisdictions other than Queensland, it is essential to prepare the draft grant / parchment which then becomes the Grant of Representation once it is sealed/engrossed by the Court.
  6. Must ensure you have obtained the original and final will and/or codicil of the deceased person.
  7. Preparing an affidavit of the attesting witness/affidavit of due execution. It is not necessary to file an affidavit of attesting witness or due execution in every probate application. Where however, the Will does not contain a sufficient attestation clause, contains no attestation clause, or there is some issue as to the witnessing requirements of the Will, then a court will require an additional affidavit be filed.
  8. Preparing an affidavit of delay (if relevant). In the ACT, Northern Territory and New South Wales, if more than 6 months has elapsed since the date of the testator’s death, there must be an explanation provided as to the reasons for the delay.

 

  1. Advertise

The solicitor will then need to advertise prior to distribution of probate.

 

  1. Distribute

Once all of the above steps have been complied with and completed, the estate may be distributed.

 

Letters of Administration

Obtaining letters of administration is the process by which a person, referred to as the administrator, is appointed by the Court to administer the estate of the deceased person. Letters of administration are appropriate in circumstances where:

  1. The deceased died intestate (referred to as Letters of Administration), i.e. without leaving a valid will.
  2. A valid will exists but does not appoint an executor or the appointed executor or executors are unwilling or incapable of acting (Letters of Administration with the will annexed).
  3. A will appoints an executor but he or she is out of the jurisdiction and appoints an attorney to obtain a grant on their behalf.
  4. The grant is made to a person over the age of 18 years when the executor named in the will is a minor.

Steps involved when applying for Letters of Administration

  1. The solicitor will firstly need to determine if the person applying is an ‘eligible person’ to apply for letters of administration.
  2. The solicitor must obtain instructions from the client. This includes identifying details and value of assets and liabilities inside and outside the relevant jurisdiction.
  3. Before filing the relevant documents to apply for letters of administration, the solicitor will need to search for a Will, obtain relevant consents and/or renunciation forms.
  4. The solicitor will then need to draft the appropriate letters of administration documentation. This solicitor must:
  5. Advertise the notice of intended application for administration.
  6. Prepare an administration bond. Administration bonds are undertakings by an administrator, on oath, to properly administer the estate with sureties guaranteeing to pay the Crown the amount of the bond in the event that the estate is not duly administered.
  7. Prepare an application/summons/original motion (if relevant).
  8. Prepare an affidavit of the applicant/executor and inventory of assets and liabilities. In all jurisdictions an affidavit must be prepared by the administrator to accompany the application for Letters of Administration. The assets and liabilities must be disclosed, either within the applicant’s affidavit, or separately, depending on the jurisdiction.
  9. Prepare an affidavit of search (as above).
  10. Prepare a Grant/parchment (as above).
  11. Prepare an affidavit of the attesting witness/affidavit of due execution (as above).
  12. Prepare an affidavit of delay (if relevant) (as above).
  13. The solicitor must advertise prior to distribution.
  14. Once the above have all been completed, the estate may be distributed.

Determining who will be the Executor with Letters of Administration

Where there is a Will – but no executor is willing or able to apply for probate

In each Australian jurisdiction (other than Queensland) where there is a Will but no executor who is willing or able to apply for probate, the conventional order favors the beneficiaries who take the residue of the estate.

Where there is no Will – total intestacy

In a total intestacy situation, the general rule for the order of preference is to ‘follow the interest’. That is; the largest beneficiary, if he or she is of capacity and appears responsible, is the preferred executor. This would normally be the spouse or partner. Definitions between the States and Territories vary as to what constitutes a partner/defacto/spouse/domestic partner. It is therefore necessary, before preparing the application, to determine who is entitled to share in the intestate estate and what their respective entitlements are (by looking at the intestacy rules).

Where the executor is a minor

In NSW the court can grant administration to a particular person listed so long as they are over 18 years of age. In all jurisdictions where the sole executor is a minor, the legislation empowers the court to grant full or limited administration with the Will annexed to the minor’s guardian or someone the court thinks fit, until the minor attains majority. Such a grant is called a grant of administration “durante minore aetate” (during the age of minority).

The Administrators duty

The administrator on intestacy is obliged to administer the estate according to law for the benefit of the beneficiaries, of whom he or she may be one. The entitlements of beneficiaries are set out in the intestacy law. The administrator “cum testamento annexo” (“CTA”) (i.e. with the will annexed) is under the same obligation as the administrator on intestacy, but the duty to administer according to law includes the duty to give effect to the terms of the will as far as is legally possible.

Applying for a reseal

‘Resealing’ is a procedure simpler than applying for an original grant of probate or letters of administration. Resealing is the procedure which permits the Court of the jurisdiction in which the application is made, to recognise grants and similar orders made in other jurisdictions. Legislation in each State and Territory allows the Supreme Court to have jurisdiction to grant a reseal of:

  1. a grant of probate of a court of competent jurisdiction in a State or Territory of the Commonwealth, or a Commonwealth country;
  2. a grant of administration of an estate; and
  3. An order to collect and administer an estate.

 

Intestate Estate

Where the deceased died without a will, the legal term is that the deceased died intestate. In such a case, a grant of Letters of Administration will be applied for instead of a grant of probate. The estate of the deceased will then pass to their eligible relatives as specified by the Act.

 

In NSW, the list of beneficiaries when there is no will are as follows:

  1. Where the deceased is survived by a spouse or spouses and has no issue then the spouse or spouses are entitled to the entire estate.
  2. Where the deceased is survived by a spouse/spouses and issue of spouse/s then the spouse/s is entitled to the entire estate.
  3. If survived by spouse/s and issue of another relationship (e.g. issue of an ex-spouse or ex-domestic partner) then:-
  4. If survived by multiple spouses then the multiple spouse/s entitlement is shared:
  5. in accordance with a written agreement they make between themselves and submit to the administrator of the estate: OR
  6. In accordance with an order of the Supreme Court; OR
  7. Equally between them.
  8. Right of one spouse to acquire any property: The spouse of an intestate has the right to acquire any of the property that belonged to the deceased. The purchase price paid for the property is firstly paid from the spouse’s entitlement in the estate and if sufficient then from their own resources. The spouse may acquire any real estate or personal estate such as a car, boat or shares.
  9. If survived only by issue then the:
  10. Children of the estate will share equally;
  11. If the children of the intestate are deceased leaving children of their own, then those children will share the portion of the estate that their parent would have received;
  12. This will continue down the generations until there are no further issues.
  13. If survived by other relatives then the relatives will inherit as follows:
    1. Parents;
    2. Siblings (either whole or half-blood);
    3. Grandparents;
    4. Aunts and uncles (either whole of half-blood)
    5. First cousins; and
    6. The Crown.

Process of administering an intestate estate

The executor, or administrator (‘personal representative’) with the will annexed, must defend the will and perform the bequests and trusts of the will as far as permitted by law, and administer the estate according to law. If there is no will, the administrator must distribute the estate of the intestate in accordance with the law of intestacy and the principles of administration of estates.

 

This means that the personal representative must carry out a number of tasks in order to administer the estate, including:

  • Providing the grant of administration (or a certified copy) to relevant asset holders;
  • Preparation of and registering (where appropriate) transmission documents;
  • Selling assets which are not transmitted to beneficiaries and considering the effect of capital gains tax on such sale;
  • Banking the proceeds of sale of assets in an estate bank account or solicitor’s trust account;
  • Paying the deceased’s debts, funeral and testamentary expenses;
  • Preparing and lodging tax returns for the deceased up to the date of death, and for the estate thereafter;
  • Distributing the deceased’s assets in accordance with the provision of the will, taking into consideration applicable rules of statutory interpretation, or if the deceased died intestate, in accordance with the rules of intestacy.

 

The general rule is that a personal representative should administer the estate within 12 months. All efforts should be made to administer the estate within this time. The Australian Taxation Office recognises that it may however take up to 3 years to administer a deceased estate.

Ascertaining assets

It is essential to undertake a thorough search through the papers and records of the deceased to locate details of assets and liabilities. In situations, where there is a possibility that the deceased had assets with a particular institution, the institution must be contacted to ascertain details of the holdings.

Bank accounts

The personal representative should write to all banks and similar financial institutions that the deceased had a connection with.

Superannuation / life insurance policies

The personal representative should write to these institutions and seek details of amounts in superannuation and/or life insurance accounts, and the institutions requirements for release.

Company shares

The personal representative should write to the relevant share registries of the companies with whom the deceased held shares. In that letter the personal representative should ask:

  • For confirmation of the holding of the shares in the company;
  • The amount of any unpaid dividends as at the date of death; and
  • For the registry’s requirements for transferring the shares to the personal representative or the beneficiaries of the estate.

Paying debts

The personal representative is required to pay the debts due by the estate. It is a good idea to write to institutions with whom the deceased had dealings, advising of the death, seeking details of any amounts outstanding, and informing them there may be a delay in payment of the account until the estate has been finalised.

Funeral expenses

It should be noted that the reasonable funeral expenses are a first charge on the estate. The person paying such costs is entitled to be reimbursed from the estate. The issue of what are reasonable funeral expenses is a matter of fact. Funeral expenses have held to include the costs of burial or cremation, including a coffin, the preparation of the body acquisition of a burial plot, the public notice of the death and the conveyance of the body. In Public Trustee v Bednarczyk and Kijas[1] Mayo J said:

“The word ‘funeral’ is usually taken to comprehend the disposal of human remains, including accompanying rites and ceremonies, that is to say, the procedure of, and appertaining to, burial or cremation, in the course of which the body is prepared for burial and conveyed by cortege to the necropolis. Such initial stages as acquisition of burial plot, public notice, obtaining a certificate of death, permission to cremate or bury, will form part of the procedure and the cost will be funeral expenses.”

Inventory of property

Once the assets and liabilities of the estate have been ascertained, the personal representative will be in a position to make application for a grant whether Probate, (where there is a valid will), Letters of Administration (where there is no valid will), or Letters of Administration (CTA) where there is a will but it fails to deal with the entire estate or fails to appoint an executor or the executor named in the will is unable or unwilling to act.

Taking control of and protecting assets

Once probate has been granted, the personal representative takes control of the assets and protects them. Protection of assets may need to be done before a grant, but the personal representative will be personally liable for her or his actions in administering the estate.

Reimbursement

Normally, the personal representative is entitled to reimbursement in full out of the estate property, but if they act outside their powers they may lose the right to recover from the estate. If necessary, an emergency grant can be obtained.

Paying debts

The next step is to pay debts. Debts are paid out of the residue of the estate before any assets are distributed amongst beneficiaries. In NSW legislation provides that where assets are given specifically by will to a beneficiary, and those assets have a mortgage or charge over them, those  assets go to the beneficiary subject to the mortgage or charge (the statutory rule is called ‘Locke King’s Act’). This means that the beneficiary receiving the asset is responsible for paying the mortgage or charge.[2]

Life insurance and superannuation

Unless the will says otherwise, life insurance policies and superannuation proceeds may not be available to pay debts. This is a crucial point if an estate is insolvent. Some assets will be more ‘liquid’ than others and thus easier to realise to pay debts. For example, a life insurance policy or shares will be quicker and easier to realise than real property. However, beneficiaries may have strong attachments to some assets, which they would like to receive in specie, i.e. the assets themselves, rather than the money. This may mean assets are sold off to pay debts. The executor or administrator should consult on these matters with the beneficiaries.

Funeral, administrative and testamentary expenses

Where the estate is insolvent, funeral, testamentary and administrative expenses have priority as stipulated in accordance with statute. In such circumstances where the estate is insolvent, it may be more advantageous to administer the estate directly under the Bankruptcy Act 1966 (Cth).

Distributing to beneficiaries under a will

The distribution of assets can occur in two ways:

  1. After assets have been gathered, and debts paid.
  2. Before all assets have been gathered.

Assets specifically given by a will must be distributed to the named beneficiaries, unless the beneficiaries involved agree otherwise. Assets may need to be sold to allow distribution of shares in the estate, or distributed directly to beneficiaries.

Distributing to beneficiaries under intestacy

‘Intestacy’ is a term to describe a situation whereby a person dies without having made a will, or where the will is not effective to dispose all or part of the deceased’s estate. The intestacy laws among the different Australian jurisdictions are not uniform. Therefore, it is important to determine the applicable law that applies in each case.

Rules of intestacy

The general rule is as follows:

  1. The deceased’s movables (being literally things that can be moved) are governed by the law of the deceased’s domicile at the date of death;
  2. The deceased’s immovables are governed by the law of the site of the property.

 

Different rules may therefore apply to the distribution of an intestate estate, depending on whether the estate consists of moveables or immovables. The rules generally benefit a surviving partner and/or partners (including de facto spouses where recognised) together with the intestate’s issue in fixed proportions. The ‘partner’ is defined to include the spouse and/or the eligible partner. An intestate’s ‘issue’ mean his or her descendants, however far removed (e.g. children, grandchildren, great grandchildren). These rules vary in different Australian jurisdictions. Intestacy rules are inflexible and may not fit the probable intention of the deceased person.

Family Provision

Time for bringing a Family Provision Application

  • New South Wales: 12 months from the date of death.[3]
  • Australian Capital Territory: 6 months from the date of the grant.
  • Northern Territory: 12 months from the date of the grant.
  • Queensland: 9 months from the date of death.
  • South Australia: 6 months from the date of the grant.
  • Tasmania: 3 months from the date of the grant.
  • Victoria: 6 months from the date of the grant.
  • Western Australia: 6 months from the date of the grant.

Granting an extension of time

Only in NSW can the Court allow an extension of time where a final distribution has been made of the estate. In NSW, the requirement for an extension of time is “where good cause is shown”.  An example of an application of this provision was Cetojevic v Cetojevic[4]  where it was held that a solicitor’s oversight in failing to cause proceedings to be commenced within 12 months of the date of death of the testator, does not by itself qualify as a “sufficient cause”.

Factors to consider when commencing an application for Family Provision

When commencing an application for an order for Family Provision the following questions should be asked:

  1. Is the applicant an eligible person pursuant to the Succession Act 2006 (NSW)(“SA”)?
  2. Is the application within time, and has an extension been granted?
  3. Are there any assets in the estate?
  4. What amount of provision out of the estate is adequate for the proper maintenance, education and advancement in life for the applicant?[5]
  5. What should be the amount and nature of such provision?
  6. In what manner should the provision be raised or paid out?
  7. Who should bear the costs of the application?[6]
  8. What further orders should the Court make?

[1] [1959] SASR 178.

[2] In some jurisdictions the rule applies only to specific gifts of real property.

[3] S 58(2) of the Succession Act 2006 (NSW).

[4] [2006] NSWSC 431.

[5] S 8 Succession Act 2006.

[6] Singer v Berghouse (1993) 67 ALJR 708 at 709; and Bowyer v Woods [2007] SASC 327;