A person dies ‘intestate’ if they do not have a valid will at the time of death (called ‘total intestacy’) or there are some assets which are not properly disposed of under a valid will (called ‘partial intestacy’).
If a person dies intestate, their property is divided according to the ‘rules of intestacy’. In New South Wales, the rules are set out in the Succession Act 2006 (NSW) (‘Act’). For total intestacy, all of the deceased’s property is divided according to the rules of intestacy. For partial intestacy, the property that has been validly dealt with under the will is divided according to the provisions of the will while the rules of intestacy apply to the property that has not been validly dealt with under the will: Act s 140.
A copy of the Act can be found here.
Rules of Intestacy With One Surviving Spouse
If the deceased died intestate with only one surviving spouse and without issue (which includes all of the deceased’s lineal descendants such as children, grandchildren, great-grandchildren, and so forth), the spouse is entitled to the whole of the deceased’s estate: Act s 111.
If the deceased died intestate with only one surviving spouse and all of the deceased’s issue are also the spouse’s issue, the spouse is entitled to the whole of the deceased’s estate: Act s 112. This arises, for example, if all of the deceased’s children, grandchildren, great-grandchildren, and so forth are from the marriage with the surviving spouse.
However, if the deceased has any issue who are not issue of the spouse, the spouse is only entitled to all of the deceased’s personal effects, a ‘statutory legacy’ (which is an amount of the deceased’s estate that is defined in the Act s 106 and is adjusted regularly to account for inflation), and half of the remaining estate: Act s 113. This situation arises if, for example, the deceased had children from more than one marriage but they only had one surviving spouse at the time of the deceased’s death. The other half of the remaining estate is divided amongst all the children in accordance with the rules set out below (see Rules of Intestacy Without Surviving Spouses): Act s 127(2).
Rules of Intestacy With Multiple Surviving Spouses
If the deceased died intestate with multiple surviving spouses and without issue, both spouses are entitled to shares in the whole of the deceased’s estate: Act s 122.
If the deceased died intestate with multiple surviving spouses and all of their issue are issue of those surviving spouses, both spouses are entitled to shares in the whole of the estate: Act s 123. This situation arises, for example, if all of the deceased’s children, grandchildren, great-grandchildren, and so forth are from marriages with the surviving spouses.
However, if the deceased has any issue who are not issue of the surviving spouses, the spouses are only entitled to shares of the deceased’s personal effects, a ‘statutory legacy’, and half of the remaining estate: Act s 124. This situation arises, for example, if the deceased had children from a marriage with someone who had passed away before the deceased. The other half of the remaining estate is divided amongst all the children in accordance with the rules set out below (see Rules of Intestacy Without Surviving Spouses): Act s 127(2).
The shares of the deceased’s estate to which each individual spouse is entitled to is governed by the Act s 125. The shares are to be determined in accordance with a written agreement between the spouses (called a ‘distribution agreement’) or in accordance with an order of the Court (called a ‘distribution order’) if either of these documents exist. Otherwise, the property is to be divided equally between the surviving spouses provided that the procedure in the Act s 125(2) has been satisfied. To divide the property equally amongst surviving spouses, the administrator of the estate, who is responsible for dividing the property of the deceased in accordance with the law, must provide each spouse written notice of the equal distribution of the property between the spouses. If three months have elapsed and the spouses have not entered into a distribution agreement, have not applied for a distribution order, or applied for a distribution order and the application has been dismissed or discontinued, the equal distribution can be made: Act s 125(2).
Rules of Intestacy Without Surviving Spouses
If a deceased died intestate without surviving spouses but with issue, the deceased’s children are entitled to the whole of the deceased’s estate: Act s 127(1). If all of the children are alive at the time of the deceased’s death, then each is entitled to an equal share of the deceased’s estate: Act s 127(3). However, if one or more of the deceased’s children pass away before the deceased, allowance is made in the division of the estate for the ‘presumptive share’ of the deceased’s children who have passed away before the deceased: Act s 127(4)(a). If this is the case, the presumptive share passes to the children of the deceased child, which can the share pass to their children if they passed away before original deceased, and so forth until the entitlement is exhausted: Act s 127(4)(b).
For example, assume a deceased A had three children B, C and D but D had passed away before A passed away. B and C would be entitled to a third of A’s estate, and D would be entitled to a presumptive share of A’s estate, being a third of the estate. The share that would have gone to D had they outlived A would be split evenly amongst D’s children. If any of D’s children passed away before A, a presumptive share would be made and the share would pass to their children, and so forth.
Rules of Intestacy Without Surviving Spouses or Issue
If a deceased died intestate without surviving spouses or issue, the Act provides for a hierarchy of close relatives of the deceased entitled to the estate of the deceased.
If a deceased died intestate without surviving spouses or issue, the surviving parents of the deceased are entitled to equal shares of the deceased’s whole estate: Act s 128.
If a deceased died intestate without surviving spouses, issue, or parents, the brothers and sisters of the deceased are entitled to equal shares of the deceased’s whole estate, accounting for presumptive shares in a manner similar to above (see Rules of Intestacy Without Surviving Spouses): Act s 129.
If a deceased died intestate without surviving spouses, issue, parents, or brothers or sisters (or issue of a brother or a sister), the surviving grandparents of the deceased are entitled to equal shares of the deceased’s whole estate: Act s 130.
If a deceased died intestate without surviving spouses, issue, parents, brothers or sisters (or issue of a brother or a sister), or grandparents, the deceased’s aunts and uncles are entitled to equal shares of the deceased’s whole estate, accounting for presumptive shares in a manner similar to above (see Rules of Intestacy Without Surviving Spouses): Act s 131.
If a deceased died intestate and there is no person entitled to their estate so none of the above situations apply, the State is entitled to the whole of the deceased’s estate: Act s 136.
How We Can Help
While talking about wills and arrangements for your death may be uncomfortable, it can provide certainty in the event you pass away and ensure that your property is divided in the way that you want. Otherwise, your property will be divided in accordance with the rules of intestacy. Wills can also be useful in outlining your wishes for matters other than the division of property. They can, for example, outline who you would like to take care of your children should you pass away before they have attained the age of 18 years or who you would like to administer your estate after your death.
At Valorum Law Group, we can assist with the creation, alteration, revocation and revival of wills as well as other documents such as powers of attorney, enduring guardian appointments and advanced healthcare directives. We can also assist with estate plans, including creating testamentary trusts, and can provide advice and representation in legal claims relating to wills and estates.
We recognise that these matters may be sensitive and uncomfortable so we undertake all work with respect and dignity so that you feel as comfortable as possible during the process.
If you have any queries, please do not hesitate to contact us at admin@valorumlaw.com.au or voregan@valorumlaw.com.au. Our wills and estates lawyers are on hand to provide advice on wills as well as other wills and estates matters and legal claims.
The information contained in this article is general information only and not legal advice. The currency, accuracy and completeness of this article (and its contents) should be checked by obtaining independent legal advice before you take any action or otherwise rely upon its contents in any way.
Contributors: Harry Chen
