Many people in the security industry face greater risks of premature death than people who work in other industries, so it would be improvement to not consider how a person can plan for the distribution and allocation of their assets, liabilities and financial resources upon their death.
To provide readers with a basic understanding about wills and issues to look out for, I will address some major points of interest, that tend to come up in repeat enquiries from clients. Please note that I am writing from a Victorian perspective, and other States may have differences in their legal frameworks.
What is a Will?
A will is a document that sets out instructions about how the will maker wishes to dispose of his assets (items of property), liabilities (debts) and financial resources (right to receive a benefit which is not yet property, such as superannuation, pensions and the like) upon his death. A will only has effect or is enforceable upon the death of the will maker.
Who Cannot Make a Will?
Generally speaking, a will cannot be made by:
- a minor (person under the age of 18 years); or
- a person who lacks the capacity to make a will.
How is a Person’s Capacity Relevant to Making a Will?
Where there is some concern about a will maker’s ‘capacity’ to provide instructions about how his will should be drafted and to understand the consequences of those instructions, it is prudent to obtain some medical evidence about the will maker’s capacity to validly make a will.
The starting point should be for the will maker to have his GP make that assessment (if the will maker clearly has full capacity) or otherwise for the GP to refer the person to a specialist doctor, such as a geriatrician, to carry out an assessment. The relevant doctor should then provide the will maker with a certificate stating that it is his opinion that the will maker does or does not have the requisite capacity to validly make a will.
If the will maker lacks such capacity, it is not lawful for him to make a will. That is, if he proceeded to make a will, it could be challenged as being invalid due to his incapacity at the time of making it.
In addition to medical evidence, lawyers are required to make their own assessment as to whether a will maker does or does not have the capacity to make a will. In some cases, a medical certificate may be provided (which states that the will maker had capacity at the time of the medical assessment), but the lawyer nevertheless assesses the client as lacking capacity at the particular time that the client attempts to provide instructions about what he wants to happen with his estate.
This situation is not that uncommon because there are various degrees of incapacity and degrees of capacity can also change over time. A will maker may be lucid one day and then lack capacity another day due to the course of his illness, his level of medication, his exposure to a particular medical treatment and other matters.
Hence, what is important is that the will maker has capacity both:
- at the time of providing instructions about how he wishes his will to dispose of his assets and liabilities (and hence how the will should be drafted); and
- at the time of signing the will and hence giving effect to those wishes.
Signing and Witnessing Requirements
Normally, for a will to be valid it has to comply with various statutory requirements pertinent to the state in which it is made. In Victoria, it must be:
- in writing; and
- signed by the will maker or someone on his behalf; and
- signed by the person with the will maker’s intention of executing a will; and
- signed by or on behalf of the will maker in the presence of two or more witnesses, who must be present at the same time (hence, there needs to be at least three people present at the same time, including the will maker); and
- attested and signed in the presence of the will maker by at least two of the witnesses, but not necessarily in the presence of each other.
It is easy for any one of the above requirements to be overlooked and to result in a will inadvertently being invalid.
What Effect does Marriage have on a Will?
The general rule under Victorian legislation is that an existing will is revoked by the marriage of the will maker. For example, if the will maker (person A) made a will prior to marriage which appointed his siblings as his executors and beneficiaries under the pre-marriage will, then upon marrying his spouse (person B), the existing pre-marriage will would be revoked and hence not operate as a valid will. Therefore, if person A died after marriage but before making a new will (a post-marriage or ‘in contemplation of marriage’ will), then person A would potentially die intestate. The consequences of dying intestate will be discussed later in this article.
This means that upon marrying, a person with an existing will should generally make a new will as soon as possible. However, there are some exceptions to that general rule. Firstly, if a will made prior to marriage contains a clause which states that the future spouse is a beneficiary under the existing pre-marriage will, then that particular clause will not be revoked upon the will maker and beneficiary/future spouse getting married.
Secondly, that same exception also applies to a clause under an existing pre-marriage will which appoints the future spouse as an executor under the existing pre-marriage will. The marriage of the will maker and executor will not then revoke the clause which appointed the future spouse as an executor.
Also, if a new will is established to have been made in contemplation of marriage and hence in the context that the will maker will be marrying a particular person, then the actual marriage, in those circumstances, would not have the effect of revoking the will.
The best way of guarding against the risk of a pre-marriage will being revoked by marriage is to include a clause in the will which states that the will is made in contemplation of the future marriage of the will maker to the particular person. That way, it is clear on the face of the existing pre-marriage will that the will maker had fully considered the consequences of marriage and had made decisions about who were to be the executors and beneficiaries under the pre-marriage will with that in mind. This removes the potential argument that the will maker in fact wanted to benefit other people and not those stated in his latest will, but just failed to get around to formally changing his will.
What Effect does Divorce have on a Will?
Generally speaking, under Victorian law, the divorce of the will maker has the following consequences on a will made by the will maker prior to the divorce:
- it revokes any clause which benefits the divorced spouse; and
- it revokes any clause which grants to the divorced spouse or in his or her favour a power of appointment, except where the power of appointment can be used by the divorced spouse in favour of children of the will maker and the divorced spouse; and
- it revokes any clause which appoints the divorced spouse as an executor, trustee, advisory trustee or guardian, except where it appoints the divorced spouse to be the trustee of property which is to be held upon trust for beneficiaries which include children of the will maker and the divorced spouse.
Again, there is an exception to this general rule if it is clear that the will maker did not wish for clauses in a pre-divorce will which related to the divorced spouse to be revoked.
By way of example, even though the will maker (person A) intended to divorce person B, person A nevertheless wished to either appoint person B as an executor and/or trustee under the will and/or as a beneficiary under the will. In such a case, the mere act of divorce would not revoke those clauses of the will which relate to person B.
However, the best way of guarding against the risk of divorce affecting clauses of an existing will which relate to the will maker’s former spouse is to state, at the time of making the will, that it is contemplated at that time that the will maker and spouse may divorce. That way, on the face of the will, it is clear that it was the will maker’s intention at the time of making his will that the act of divorce should not affect those clauses of his will which relate to his former spouse.
In the next issue, we will look at issues around the consequences of an invalid Will, why some Wills get challenged, how to prevent a Will being challenged and why such challeges are often settled out of court.
Whilst every effort has been taken to ensure its accuracy, the information contained in this article is intended to be used as a general guide only and should not be interpreted as being specific advice, legal or otherwise. The reader should seek professional advice from a suitably qualified practitioner before relying upon any of the information contained herein. This article and the opinions contained in it represent the opinions of the author and do not necessarily represent the views or opinions of Interactive Media Solutions Pty Ltd or any advertiser or other contributor to Security Solutions Magazine.