John Mann providing Q & A on Wills and Estates law

Tuesday, 16 August 2016 

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CS – Chris Smith /JM – John Mann /C1,2,3, etc – Callers 

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CS       Yes thanks to Turner Freeman Lawyers and their Legal Matters segment. Here we are again on a Tuesday afternoon. We’ve got a $100 Westfield Voucher to give away to the caller who asks the most, I guess relevant, logical question of the day. Turner Freeman Lawyers also provide a range of specialised legal services including  compensation and negligence law, asbestos litigation, superannuation and disability claims, family and employment law, wills and estate and property law. The NSW offices are in Sydney, Parramatta, Campbelltown, Penrith, Newcastle and the Gong Wollongong.  And they also have offices in South Australia, WA and Queensland. If you’ve got a question this afternoon on Wills and Estates, give us a call on 131 873.  We’re talking Wills and Estates and recently the father of Gold Coast jihadist, Amira Karroum launched a legal battle to claim her $300,000 life insurance. Now Amira Karroum was an armed soldier who died fighting for Islamic extremist 2 years ago. You may know the story. And now her father Mohammad Karroum says the life insurance policy should be honoured because she was tricked into entering Syria at a time that it was not illegal to do so.  Let’s put that to John Mann this afternoon. An accredited specialist in Wills and Estates law and property law as well. He’s in the Penrith office of Turner Freeman. He also sees clients in Windsor and Gloucester. John. Good afternoon to you sir.

JM      Hello Chris.

CS       This is a tricky one. So Amira Karroum dies in battle. The father’s claiming, well hang on a second she was tricked into entering Syria at a time when it was not illegal to do so. He’s claiming $300,000 of her life insurance. The case is going on in Queensland at the moment. What chance?

JM      It’s very hard to give a view on that Chris. Insurance like so many other things is a contract. A contract which has terms and a policy which sets out what they will pay for and what they won’t pay for.

CS       Yeah.

JM      And depending on what that says, depends on the terms and conditions the insurer will or won’t meet the claim.

CS       So what usually would happen if someone like a young person like Amira Karroum, had a life insurance policy. It got up to $300,000. Where does it go?

JM      Well it doesn’t go anywhere if the insurer chooses not to pay it. The father will have to take action in the courts if he’s her legal representative, executor or whatever the case may be. But if the insurer refuses to pay then you have to sue them in the ordinary course.

CS       Intrust Super refused to pay the life insurance because of her ties to terrorist group Al-Qaeda. That’s a fair argument.

JM      That could well be. You see the other thing is Chris – that life policies are full of all sorts of exceptions and rules as to when they will and when they won’t pay and even engaged in an act of war. In the last major war, soldiers were told that their policies would be void because they were going off to fight a war on foreign soil and the life policies wouldn’t be met if they were killed in a war, because that was in their policies.

CS       Yes and the likelihood was that they might not necessarily come back.

JM      Well exactly.

CS       Alright. 19 to 2. John Mann ready to take your call about Wills and Estates. Always a very popular topic here. Martin. Go right ahead.

Caller 1 – Martin. 

Martin            Yeah. G’day John. About 4 years ago my late father-in-law died and left his house to my three children. He left a provison in his Will that it wasn’t to be handed over until the youngest turned 25, which is another 8 years. Two of my….. my eldest two children are of adult age now. The executor of the Will no longer wants to look after the house. Shouldn’t it be changed so that she can flip over the executor or flip over the house to the children before my youngest turns 25?

CS       Ooh interesting question.

JM      Martin. The answer to that depends on how the Willis written. Now, if it is a condition that your child has to turn 25 in order to take their share. It’s what’s called a condition or gift meaning that until they reach the age of 25, you don’t know how many people are going to share in the gift. So in that situation, there is no entitlement of the one who was under 25 to have any share of anything. That’s still held in trust for them. Now there may be means by which the place may have to be sold to pay rates and other costs. The two that have gone over the line age-wise can take their shares but the remaining one can’t have anything until they turn 25 if that’s the condition of the Will – the condition of the gift.

Martin            Yeah. No. The eldest two have not turned over 25.

JM      Well no-one gets anything then. No-one gets anything until they get to that age.

Martin            So the executor has to hold onto that house for another 8 years?

JM      Well there can be difficulties you know. It may not be possible for the executor to hold onto the place because of the cost of maintenance and insurance rates, – all those sorts of things.  So that depending again what the Will says, the property may need to be sold – all of the funds invested and held by the trustee until such time the kids start going over the age of 25.

Martin            Okay, great. 

CS       Alright Martin. Thank you very much for your call. Michael go right ahead.

Caller 2 – Michael

Michael           Yeah.  G’day. My father passed away …… a bit similar…… my father passed away about 3 years ago in Victoria and there was a dispute with the Will where somebody, not in the family, did contest the Will and we went down to Victoria for mediation over 12 months ago now and from what I’ve heard from a solicitor that I acquired in Queensland that the executor of the Estate did not present the letter of mediation to the courts and I was just wondering what the GO would be from now on I guess? 

JM      Well, I’m not quite familiar with the procedure in Victoria. Mediation could be one of two things. It could be something that is ordered to take place by the courts or it could be merely an informal gathering of all the parties to get together and see if they can settle a case. That’s the general purpose of mediation. In NSW mediation in these Will challenge cases is compulsory. The other thing though is when a mediation takes place, the result of it, assuming that settlement is not reached and whatever is said and done at that mediation, can’t be used in evidence in the case. So all I can gather from what you have told me is that a mediation was probably unsuccessful and you are now waiting for the court to come up to hearing the case in full where there is a decision by the Judge.

Michael           Okay. We did have ….. everybody did agree to a document and everybody actually did sign the document but… the executor didn’t hand it over to the court so I was wondering if…..I was told to make a complaint to the Victorian Law Society I think it was. Would that be an avenue to go down?

JM      Possibly. If the case was settled. There is really no reason why that it should not be discontinued because the executor wouldn’t have brought it, someone else would have brought it against the executor. But if the whole thing had been settled, surely someone would have notified the court and say that the matter didn’t go any further. Was everybody in the settlement an adult?

Michael           Yes. Yes.

JM      Because often if the settlement involved children it has to be approved by a Judge, but everyone’s an adult and over age and not under any disability, then you can agree amongst yourselves as to whatever needs to be done.

Martin            Yeah okay.  Alright…Thank you.

CS       Good on you Michael. Thank you very much for your call. That’s a difficult one. Just getting back to executors and we’ve had a couple of questions involving executors, not necessarily doing what they were meant to do. Can an executor turn around after being appointed by someone in their Will to look after a property…… Can they actually just put their hands up and say I don’t won’t any part of this again? Can they walk away?

JM      They can. Generally it’s a decision that you should make before taking Probate. The executor doesn’t have to take on the offers of executor if they don’t want to. They can pronounce the appointment.

CS       Ah ha. And then what happens?

JM      Well, somebody else will have to take the grant. Commonly, it is the beneficiaries in the Will themselves who get a grant of what’s called Administration with the Will annexed… the Will attached, and they look after the administration. That can have all sorts of complications because if there’s people in there that won’t consent or juveniles, the Court may require cash bonds or something……

CS       It becomes complicated.

JM      it’s quite difficult.

CS       What about legal action from the beneficiaries against an executor, that must happen from time to time because some of the beneficiaries wouldn’t agree with the executor is doing with property.

JM      Exactly. The executor stands in the place of the deceased person. So, for example if the estate consists of a real estate, it’s the task of the executor to sell it. Now, that casts an obligation on him to get what price he can reasonably get using all reasonably efforts to sell it. A wise executor would if he’s selling a property consult all the beneficiaries and say are you happy with this price because although he can make a decision entirely on his own, he’ll say well I’m selling the place for “x” dollars. Later on if “x ” dollars proves to be well and truly below market value, he might be personally responsible to the beneficiaries.

CS       So it’s a very responsible position involved…..

JM      It certainly is. It certainly is, yes.

CS       Okay John Mann from Turner Freeman to take your calls right after the break. t’s 11 to 2.

Break 

CS       Alright Mitchell is on our open line. Mitchell. John is listening. Go right ahead.

Caller 3 – Mitchell 

Mitchell          How are you going John?

JM      G’day.

Mitchell          Um, I’ve got a situation where my father has wanted to make provision in his Will for a ….. oh…. it’s quite complex….. He’s taken on the care of my sister’s child.  She was an alcoholic and what have you. So he’s got four children, me being the middle… one of the middle ones…. but he wants to leave a portion of his Will to that child – effectively excluding his other grandchildren. Is that challengeable?

JM      No. Not really. Not unless he is given similar sort of considerations to the other grandchildren. To be eligible to claim in a person’s estate if you are a grandchild, you are eligible provided that you have received support from your grandparent. Now bringing you up, providing you with accommodation, clothing, and food. That would be certainly sufficient and also being part of their grandparent’s household effectively, but other grandchildren who are just grandchildren who visit on a Sunday and they’re given presents for Christmas and birthdays and things, no. They are not eligible to claim. 

CS       So Mitchell is this a Will that has been prepared and he hasn’t passed away?

Mitchell          No…. he hasn’t …… like I don’t know if he has prepared the Will, but he has discussed it with us. He sort…. at one stage he was sort of thinking that he was going to bypass the children altogether and divvy it out amongst the grandkids, which again I would challenge that but I would have thought that if he singled one grandchild out for one reason or another, it would, I suppose it would be seen as being unfair towards the others.

JM      Well not particularly because it’s his money. He can do with it as he pleases. But ……

Mitchell          Yeah.

JM      But the thing is that where that situation has arisen and where he has had a grandchild basically raised as a child of his own, then the law casts an obligation on him to consider the needs of that grandchild in his Will. It may not be a huge proportion or whatever else but nonetheless there would have to be some consideration given to that.

CS       Yes.  It’s a difficult one for you. You’ve got the $100 Westfield Voucher Mitchell.  it’s a really good question that would possibly help a lot of people who are listening at the moment. That $100 Westfield Voucher is yours mate. Just stay right there will you.

Mitchell          Thank you very much.

CS       No problem. 5 minutes to 2. We’ve only just got……. Liz. very quickly please……

Caller 4 – Liz

Liz      Yes. Hi there. I’ve separated from the husband – not divorced but have had a property settlement. Would he be entitled to ….. if I was to get an inheritance. Would he be entitled to claim on that?

JM      You are still married? He’s still your husband?

Liz      Yes.

JM      Look. I think the answer to that is probably not. That’s often the realms of family law but if you were to pass away without a Will, he would inherit your estate because he’s still your husband.

Liz      Oh, okay. Thank you very much.

CS       Good on you Liz. Thank you very much for the question. Thank you very much for your time John Mann. Always interesting and a couple of interesting aspects of the responsibility that executors face that we haven’t been across before on this program. Thank you once again.

JM      Thanks Chris.

CS       Okay John Mann, accredited specialist in Wills and Estates law and property law, with Turner Freeman Lawyers we do this each and every Tuesday afternoon. We look forward to your calls next Tuesday.