Intestate Succession: Understanding Estate Distribution Without a Will

Introduction

In New South Wales, the laws surrounding estate distribution can be complex, especially when someone passes away without a will. This situation, known as intestacy, the estate is distributed according to the rules of intestate succession, which requires a clear understanding of the intestate succession process to ensure the deceased’s estate is distributed according to NSW laws. This article will explain how intestate succession works, how it differs from having a will, and the legal rules that determine asset distribution among surviving family members.

What is Intestate Succession?

Intestate succession occurs when a person dies without leaving a valid will. In such cases, the distribution of their estate is governed by the Succession Act 2006 (NSW).  Unlike a will, which specifies the deceased’s wishes for asset distribution, intestate succession follows a predetermined hierarchy of beneficiaries and the manner in which the estate is divided among them.

Estate Distribution: With vs. Without a Will

When there is a valid will, the executor named in the will manages the estate according to the deceased’s instructions. The will specifies who inherits specific assets, how debts should be paid, and other important details.

In contrast, if there is no will, the court appoints an administrator to manage the estate. The administrator is often a close family member who applies for a grant of letters of administration from the Supreme Court of NSW. The estate is then distributed according to the intestate succession laws, which may not align with the deceased’s personal wishes.

Who Inherits Under Intestate Succession?

The distribution of an intestate estate in NSW follows a specific order of priority:

Spouse and Children:

If the deceased leaves behind a spouse (including de facto partners) and children, the spouse is entitled to the whole estate if there are no children from other relationships. If there are children from other relationships, the spouse receives a statutory legacy (currently set at $350,000) and a share of the remainder, while the rest is divided among the children.

Children: 

If there is no surviving spouse, the estate is divided equally among the deceased’s children. If a child has predeceased the intestate person but has left children (the deceased’s grandchildren), the grandchildren take their parent’s share.

Parents: 

If the deceased leaves no spouse or children, the estate goes to the parents.

Siblings: 

If there are no surviving parents, the estate is shared among the deceased’s siblings.

Extended Family: 

If no siblings survive, the estate is distributed to more distant relatives such as grandparents, aunts, uncles, and cousins.

The State: 

In the absence of any surviving relatives, the estate ultimately passes to the state of New South Wales.

The Role of the Administrator

In the absence of a will, an administrator is appointed to manage the estate. This person is usually the closest next of kin or a beneficiary who applies to the Supreme Court of NSW for a grant of letters of administration. The administrator’s role includes gathering and valuing the deceased’s assets, paying any debts, and distributing the remaining estate according to the intestate succession laws.

Why Having a Will is Crucial

While the intestate succession laws in NSW provide a structured approach to estate distribution, they may not reflect the deceased’s personal wishes. Having a will ensures that your assets are distributed according to your preferences and can help avoid potential disputes among beneficiaries. It also allows you to appoint a trusted executor to manage your estate, providing peace of mind for you and your loved ones.

Seek Legal Advice

Navigating the complexities of intestate succession can be challenging. It is advisable to seek legal advice to understand your rights and obligations under the Succession Act 2006 (NSW). An experienced estate planning lawyer, like Maguire & McInerney, can help you draft a will that reflects your wishes and ensures your estate is managed according to your intentions.

Maguire & McInerney are here to help you navigate the legal intricacies and ensure your estate is handled with care and precision. Call us today, or visit our website to schedule a consultation.