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  • Writer's pictureLee-Ann Cartoon

The importance of keeping watch over your succession plan

Updated: Jun 9, 2020

It is a topic that we often put off, saying we will get to it tomorrow or next week, but the consequences of not ensuring that you have a valid or up to date succession plan in place can be devastating, both financially and emotionally, for those left behind.

A significant estate matter comes to mind where the testator advised his lawyer at the time that he wished to update his Will to ensure his wife was better provided for, however put it off and ultimately passed away before any updates were put through. As a consequence, pursuant to the Will, an elderly widow was left without a primary residence or disposable income. This outcome could have been so easily avoided had the testator taken the few hours necessary to update his succession plan.

Whilst recourse may be sought through the Courts to remedy unjust outcomes, this course of action should be considered one of last resort due to its cost, time and most importantly emotional toll.

I have seen countless more examples of protracted legal disputes between close family members arising due to poorly drafted or invalid succession documents. This is why I am so passionate about the area of succession planning, as I believe that the time and monetary commitment required to put in place valid and current documents, far outweighs the heartache, tension and costs that close family members bear trying to impute what a testator had intended.

It is also important to appreciate those interests and assets that can be passed on through one's Will and those which cannot. Beneficial interests in discretionary trusts for example cannot be passed on to beneficiaries under a Will. Shares in a company can be transmitted under a Will, however it is necessary to review the relevant company constitution to ensure it allows for such transmission and if there are any associated restrictions around future dealings. It is also important to consider any shareholder and buy-sell agreements that may be in place.

I have reviewed numerous DIY Will Kits and can say with certainty that in all but the simplest cases, these are inadequate for succession planning purposes. My sentiment is echoed by Master Sanderson in two WA Supreme Court cases (Rogers v Rogers Young [2016] WASC 208 and Brant v Murray [2016] WASC 390) where he states as follows:

"On numerous occasions when dealing with so-called homemade wills, I have observed they are a curse. Homemade wills which utilise what is sometimes known as a 'will kit' are not much better. This case proves the point. The disposition effected by the will is not complicated and no doubt the testator had clearly in mind what she intended to achieve. But the way the will is drafted is difficult, and the parties have been put to the trouble and expense of coming to the court seeking directions as to its proper interpretation. If the will had been drafted by a competent legal practitioner, this problem would not have arisen and the parties would have been spared a great deal of trouble and expense." and;

"Over the years I have made countless statements in judgments bemoaning the fact testators seem to think they can adequately deal with their estate by way of a homemade will. Really there is nothing left to say on the topic. This case reinforces again the difficulties which so frequently arise. What should have been a simple grant of probate to give effect to a straightforward disposition of a small estate requires the intervention of the court."

Be prepared and rest easy knowing that you have a valid succession plan in place that will ensure your legacy continues as you would wish and without any added burden on those closest to you. It is a small price to pay for great peace of mind.

Keep your assets safe through proper planning today.

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