Family Provision Claims: A recent trend – Crisp Order

A family provision claimant needs to satisfy the Court of certain elements before the Court will order that provision (or greater provision) should be made for the claimant who is challenging the provisions of a will.

Depending on the nature and size of the estate’s assets, the Court may find it difficult to make “adequate provision” for a claimant while at the same time balancing the needs of existing beneficiaries and the will-maker’s right to testamentary freedom, which is the right of a person to dispose of their assets however they wish.

An example of how the Court has approached this issue can be seen in its increasing use of what is called a Crisp Order.

Brief Case Study

Imagine a scenario where a deceased leaves a de facto spouse of 20 years and two biological children from a previous relationship. The deceased’s estate comprises a house worth $500,000 and cash of $40,000.

Under the deceased’s last will, the deceased leaves the house to his two children and gives the cash to his de facto spouse. The de facto spouse has lived in the house for the last 20 years, has no substantial assets of her own and will need to move to an aged care facility in the near future.

Community values, generally speaking, support the idea that a person has the largest moral obligation to provide for their spouse after they die.

In the above situation, a family provision claim would be expected to be made by the de facto spouse.

The Court would likely make an order for additional provision to the de facto spouse, however may be reluctant to deprive the children of their entire inheritance. To meet the immediate needs of the de facto spouse and preserve the entitlements of the children, the Court may make what is called a Crisp Order.

Crisp Order

The term Crisp order comes from the case Crisp v Burns Philp Trustee Company Ltd (Supreme Court NSW, 1979, unreported).

Ipp JA in Milillo v Konnecke [2009] NSWCA 109 at [48] said:

“A Crisp order may entitle a plaintiff, from time to time, to require the executor of a will to sell a home devised by a will or otherwise owned by the estate, and to use the proceeds for purposes that may include purchasing another home for the plaintiff’s use or occupation, or providing accommodation for the plaintiff in a retirement village or similar institution, or in like accommodation providing hospitalisation and nursing care. The flexibility provided by such an order underlies the notion that Crisp order confers “a portable life interest.”

Returning to the above scenario, a Crisp order may mean that the de facto spouse is able to stay in the home for as long as she is able, and then if required use the sale proceeds to fund an accommodation deposit at an aged care facility. When the de facto spouse dies, the balance of the funds from the sale of the original property will be distributed to the deceased’s two children as initially intended by the deceased.

Crisp orders have primarily been utilised by the Court when dealing with older spouses. The flexibility that they offer can be an effective solution to both the Court and parties looking to negotiate the successful settlement of a family provision claim.

It should also be noted that it is possible to leave someone with a “portable life estate” through your will, which may be an effective tool in minimising costs and heartache for those you wish to benefit from your estate if they were to be involved in a family provision claim.

Whether you have a query in relation to a potential family provision claim or an enquiry about making a will, Turner Freeman Lawyers have experienced Wills & Estates lawyers that can assist you with any legal matters you may have. Call 13 43 63 to arrange an appointment at your nearest Turner Freeman office.