Administration and Probate and Other Acts Amendment (Succession and Related Matters) Bill 2016
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 TABLE OF PROVISIONS Clause Page Part 1--Preliminary 1 1 Purposes 1 2 Commencement 2 3 Principal Act 2 Part 2--Amendments relating to intestacy 3 4 Definitions 3 5 Definitions for Part I 4 6 Partner may obtain intestate's interest in shared home 4 7 Trust for sale on intestacy 4 8 Heading to Division 6 of Part I repealed 4 9 Repeal of intestacy provisions 4 10 Reference to Statutes of Distributions 4 11 New Part IA inserted 5 12 Court may make family provision order 32 13 Contents of family provision order 32 Part 3--Amendments relating to fees, commissions and other matters 33 14 Definitions 33 15 Solvent estates--pecuniary legacies 33 16 New section 65A inserted 33 17 New sections 65B to 65E inserted 34 18 Concealment of will a misdemeanour 37 19 New sections 106 to 108 inserted 38 Part 4--Amendments relating to ademption 41 Division 1--Amendment of the Principal Act 41 20 New sections 50 and 51 inserted 41 i
Clause Page Division 2--Amendment of the Guardianship and Administration Act 1986 42 21 Interest of represented person in property not to be altered by sale or other disposition of property 42 22 New section 53A inserted 43 23 Application to the Tribunal by a creditor etc. 43 Division 3--Amendment of the Powers of Attorney Act 2014 44 24 New sections 83A and 83B inserted 44 25 New Division 7 inserted in Part 8 45 Part 5--Consequential amendment of other Acts and repeal of amending Act 47 26 Marriage Act 1958--Abolition of husband's liability for wife's torts and ante-nuptial contracts debts and obligations 47 27 Trustee Companies Act 1984--Trustee company to be subject to same duties as individual 47 28 Wills Act 1997--Definitions 47 29 Wills Act 1997--New section 49A inserted 47 30 Wills Act 1997--New section 56 inserted 48 31 Repeal of amending Act 48 ═══════════════ Endnotes 49 1 General information 49 ii
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 [Assented to ] The Parliament of Victoria enacts: Part 1--Preliminary 1 Purposes The main purposes of this Act are-- (a) to amend the Administration and Probate Act 1958 in relation to intestacy and other matters relating to the administration of estates, including the charging by executors of fees and commissions; and 1
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 1--Preliminary (b) to make further provision in relation to ademption by amending the Administration and Probate Act 1958, the Guardianship and Administration Act 1986 and the Powers of Attorney Act 2014. 2 Commencement (1) Subject to subsection (2), this Act comes into operation on a day or days to be proclaimed. (2) If a provision of this Act does not come into operation before 1 November 2017, it comes into operation on that day. 3 Principal Act In this Act, the Administration and Probate Act 1958 is called the Principal Act. 2
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy Part 2--Amendments relating to intestacy 4 Definitions (1) In section 3(1) of the Principal Act insert the following definition-- "legacy interest rate means the rate that lies 2 per cent above the cash rate last published by the Reserve Bank of Australia before 1 January in the calendar year in which interest begins to accrue;". (2) In section 3(1) of the Principal Act-- (a) insert the following definitions-- "aunt or uncle means a sibling of a deceased person's parent; cousin means a child of a deceased person's aunt or uncle; intestate includes a person who leaves a will but dies intestate as to some beneficial interest in that person's real or personal estate; residuary estate of an intestate means the residue of the intestate's real and personal estate, including-- (a) the money and any investments representing the money arising from any sale or conversion of the estate under section 70H; and (b) any part of the estate of the intestate which-- (i) may be retained unsold; and (ii) is not required for the administration purposes of the estate, for the payment of any amount specified in 3
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy section 70H(4)(a) or for the setting aside of any fund under section 70H(4)(b);"; (b) in the definition of partner, after "dies" insert ", other than in Part IA,". 5 Definitions for Part I (1) In section 5(1) of the Principal Act, after "In this Part" insert "and Part IA". (2) In section 5(1) of the Principal Act, the definition of intestate is repealed. 6 Partner may obtain intestate's interest in shared home Section 37A of the Principal Act is repealed. 7 Trust for sale on intestacy Section 38 of the Principal Act is repealed. 8 Heading to Division 6 of Part I repealed The heading to Division 6 of Part I of the Principal Act is repealed. 9 Repeal of intestacy provisions Sections 50, 51, 51A, 52, 53 and 55 of the Principal Act are repealed. 10 Reference to Statutes of Distributions In section 56 of the Principal Act-- (a) for "the eighteenth day of December One thousand nine hundred and twenty-nine" substitute "18 December 1929"; (b) for "to this Division" substitute "to Part IA"; (c) for "the foregoing provisions of this Division" substitute "Part IA". 4
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy 11 New Part IA inserted After Part I of the Principal Act insert-- "Part IA--Intestacy Division 1--Application and definitions 70A Application of this Part (1) This Part applies if a person dies-- (a) without leaving a will; or (b) leaving a will which does not effectively dispose of the person's estate wholly or partially. (2) If a person dies leaving a will, this Part applies to the part of the person's estate not disposed of by that will subject to-- (a) the provisions of the will; and (b) the following modifications-- (i) any requirements about bringing property into account apply to any beneficial interests acquired by any issue of the deceased under the will of the deceased; (ii) subject to the rights and powers of the personal representative for the purposes of administration, the personal representative must be a trustee for the persons entitled under this Part for the part of the estate not expressly disposed of, unless it appears by the will that the personal representative is intended to take that part beneficially. 5
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy 70B Definitions for this Part In this Part-- acquisition authorisation order means an order of the Court under section 70U; distribution agreement means an agreement entered into between multiple partners of an intestate as to the distribution of the intestate's estate between those partners; distribution order means an order of the Court under section 70ZD; partner of an intestate means the person's spouse, domestic partner or registered caring partner at the time of the intestate's death; Note See also definitions in section 3(1). partner's property election means an election by the surviving partner of an intestate under section 70P; partner's statutory legacy means the amount to which a partner is entitled under Division 3-- (a) as specified in section 70M(1); or (b) as published from time to time by the Minister under section 70N; real and personal estate of an intestate means every beneficial interest (including rights of entry and reverter) of the intestate in real and personal estate which (otherwise than in right of a power of appointment or of the testamentary power conferred by statute to dispose of entailed interests) the 6
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy intestate could have disposed of by will, if of full age and capacity; right to elect notice means a notice under section 70Q. 70C Survivor requirements (1) A person is not entitled to participate in the distribution of an intestate's estate under this Part unless the person survives the intestate for at least 30 days. Note See also section 5(2). (2) For the purposes of this Part, a person referred to in subsection (1) is taken to have predeceased the intestate. (3) This section does not apply if its application would result in an intestate's estate passing to the Crown under this Part. 70D Entitlement to distribution from estate in more than one capacity A person may be entitled to participate in the distribution of an intestate's estate in more than one capacity and is entitled to take in each capacity in which the person is entitled. 70E Rights of creditors not affected Nothing in this Part affects the rights of any creditor of the deceased or the rights of the Crown in respect of duties. 70F Date of valuation In determining values for the purposes of this Part (other than Division 4), the date of valuation is the date on which the value of the residuary estate is ascertained after-- 7
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (a) the payment of any amount specified in section 70H(4)(a); and (b) the setting aside of any fund sufficient to provide for any pecuniary legacies bequeathed by the deceased's will in accordance with section 70H(4)(b). 70G Inter vivos gifts do not affect entitlements The distribution of an intestate's estate is not affected by gifts made by the intestate to persons entitled-- (a) during the intestate's lifetime; or (b) in the case of a partial intestacy, by will. Division 2--Trust for sale of intestate's property 70H Trust for sale of intestate's estate (1) On the death of a person intestate as to any real or personal estate, the intestate's estate must be held by the person's personal representative on trust as to both real estate (including chattels real) and personal estate. (2) The personal representative has a discretionary power of sale and conversion of the intestate's estate. (3) The personal representative has the power to postpone any sale and conversion of the intestate's estate under subsection (2)-- (a) for any period that the personal representative thinks appropriate; and (b) so that any reversionary interest is not sold until it falls into possession, unless the personal representative sees special reason for the sale; and 8
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (c) so that, unless required for purposes of administration owing to want of other assets, personal chattels must not be sold except for special reason; and (d) pending any partner's property election being made. (4) Out of the net money forming part of the intestate's estate or received from any sale and conversion of the intestate's real and personal estate (after payment of costs) and out of the ready money of the intestate (so far as not disposed of by will, if any), the personal representative of an intestate must-- (a) pay any funeral, testamentary and administration expenses, debts and other liabilities that are properly payable under the rules of administration in Division 5 of Part I; and (b) if there is any residual money after paying the amounts identified in paragraph (a), set aside a fund sufficient to provide for any pecuniary legacies bequeathed by the deceased's will (if any). 70I Investment of estate pending distribution (1) Pending the distribution of the whole or any part of the estate of an intestate, the personal representative may invest in any investments for the time being authorised by statute for the investment of trust money-- (a) the residue of money from any sale or conversion under section 70H; or (b) so much of that money as has not been distributed. 9
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (2) The personal representative has discretion to change an investment under subsection (1) to an investment of a similar nature. (3) After payment of rates, taxes, rent, costs of insurance repairs and other outgoings properly attributable to income, the income, including net rents and profits of real estate (including chattels real), of so much of the deceased's estate which is not disposed of by will (if any) or is not required for the administration purposes required by this Part, may be treated and applied as income as from the death of the deceased, however that estate is invested. Division 3--Distribution if intestate leaves a partner 70J Distribution if intestate leaves a partner and no child or other issue (1) If an intestate does not leave a child or other issue but leaves a partner, the partner is entitled to the whole of the intestate's residuary estate. (2) This section does not apply if an intestate leaves more than one partner. 70K Distribution if intestate leaves partner and issue of that partner (1) If an intestate leaves a partner and a child or other issue who is also a child or other issue of that partner, the partner is entitled to the whole of the intestate's residuary estate. (2) This section does not apply if an intestate leaves-- (a) more than one partner; or 10
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (b) a child or other issue who is not also a child or other issue of the intestate's surviving partner. 70L Distribution if intestate leaves partner and child or issue not the child or issue of that partner (1) If an intestate leaves a partner and a child or other issue who is not the child or other issue of that partner, the partner is entitled-- (a) if the intestate's residuary estate is worth not more than the amount of the partner's statutory legacy, to the whole of the estate, including the personal chattels of the intestate; and (b) if the intestate's residuary estate is worth more than the amount of the partner's statutory legacy, to-- (i) the personal chattels of the intestate; and (ii) the amount of the partner's statutory legacy; and (iii) interest on the partner's statutory legacy calculated at the legacy interest rate from the date of the death of the intestate to the date of payment of that legacy; and (iv) one half of the balance of the residuary estate. (2) If subsection (1)(b) applies, any children of the intestate are entitled to the other half of the balance of the residuary estate, and if more than one, in equal shares. (3) If one or more of the intestate's children predeceased the intestate leaving issue who survived the intestate-- 11
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (a) the share of the deceased child is to be divided between that deceased child's children; and (b) if any of those grandchildren of the intestate predeceased the intestate leaving their own issue who survived the intestate, the deceased grandchild's share is to be divided between the deceased grandchild's children and so on until the entitlement is exhausted. 70M Amount of partner's statutory legacy (1) From the commencement of this section until subsection (2) applies, the amount of the partner's statutory legacy is $451 909. (2) From the financial year commencing immediately after the commencement of subsection (1) and for each subsequent financial year, the amount of the partner's statutory legacy must be calculated in accordance with the following formula-- B A× C where-- A is-- (a) $451 909; or (b) if an amount has been calculated in accordance with this formula and that amount is greater than $451 909, the amount as last calculated; B is the All groups consumer price index for Melbourne in original terms for the most recent reference period in the preceding calendar year most recently 12
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy published by the Australian Bureau of Statistics as at 15 June immediately preceding the date on which the variation is made; C is the All groups consumer price index for Melbourne in original terms for the corresponding reference period one year earlier than the reference period referred to in B published by the Australian Bureau of Statistics as at 15 June immediately preceding the date on which the variation is made. (3) If the amount of the partner's statutory legacy has been calculated under subsection (2) and-- (a) the amount is reduced, the reduced amount does not take effect, except for the purpose of the application of the formula under this section in the following year; or (b) if, in the next or subsequent financial year the amount of the partner's statutory legacy is increased following a reduction referred to in paragraph (a), that amount has effect as an increase only to the extent (if any) that-- (i) the amount of the increase exceeds the amount of the reduction in the previous financial year; or (ii) part of the reduction has not been set off against a previous increase. (4) For the purpose of calculating the amount of the partner's statutory legacy in accordance with the formula under this section-- 13
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (a) if the amount of the variation is less than $1000, it must be rounded to the nearest whole $1; and (b) if the amount of the variation is $1000 or more, it must be rounded to the nearest whole $10. 70N Minister to publish notice of amount of partner's statutory legacy in Government Gazette On or before 1 July of the financial year commencing immediately after the commencement of section 70M(1) and on or before 1 July in each subsequent financial year, the Minister must publish a notice in the Government Gazette that states the amount of the partner's statutory legacy calculated in accordance with section 70M for the following financial year. Division 4--Partner's rights as to estate property by election 70O Application of this Division (1) This Division applies if an intestate does not leave multiple partners. (2) This Division does not apply if section 70J or 70K apply. 70P Partner may make partner's property election to acquire intestate's interest in property of estate (1) By making a partner's property election, an intestate's partner may elect to acquire property from the intestate's estate-- (a) at its value on the date of the intestate's death as determined in accordance with section 70V; or 14
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (b) at any other value as agreed by the partner and all the other beneficiaries entitled to share in the intestate's estate. (2) A partner may acquire an interest by making a partner's property election even if the partner is-- (a) a personal representative or trustee; or (b) a minor. 70Q Partner to be given right to elect notice (1) Subject to subsection (3), within 30 days of the grant of administration of an intestate's estate, the personal representative must give the partner of the intestate to whom this Division applies a written notice informing the partner of the partner's right to make a partner's property election. (2) A right to elect notice must state the following-- (a) how the partner's property election is to be made; (b) the fact that the partner's property election may be subject to the Court's authorisation by acquisition authorisation order and the circumstances in which an acquisition authorisation order is required; (c) that, unless the partner is the intestate's personal representative, the right to make the partner's property election must be exercised within-- (i) 3 months of the date of the right to elect notice; or 15
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (ii) any longer period allowed by the Court after the date of the right to elect notice. Note See section 70R for times within which election is to be made. (3) A right to elect notice is not required if the partner is the personal representative of the intestate. 70R Time for making partner's property election (1) A partner's property election must be made-- (a) if the partner is a personal representative of the intestate, within 3 months of the grant of administration; or (b) if the partner is not a personal representative of the intestate, within 3 months of the date of the right to elect notice which has been given to the partner; or (c) if the Court extends the time for making the election, by the date to which the period for election is extended. (2) The Court may extend the time for making a partner's property election-- (a) if it considers there is sufficient cause for doing so; and (b) whether or not the time for making the partner's property election has passed, but not after the administration of the estate has been completed. 16
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy 70S How partner's property election is made (1) An intestate's partner who makes a partner's property election must make it in writing identifying, with reasonable particularity, the property of the intestate which the partner elects to acquire. (2) Subject to subsection (4), the partner must give a copy of the partner's property election-- (a) to the personal representative who sent the partner the right to elect notice, if the partner is not a personal representative; and (b) to each other person who is a personal representative, other than the partner if the partner is also a personal representative; and (c) to each beneficiary, other than the partner, who is entitled to a share in the intestate's estate; and (d) to the registrar. (3) A partner who is required by subsection (2) to give a copy of a partner's property election to the persons referred to in that subsection, may apply to the Court for an order that a copy of the election is not required to be given to any or all of the persons specified in that subsection. (4) On an application under subsection (3), the Court may order that the copy of the partner's property election need not be given to any or all of the persons referred to in subsection (2) if the Court considers that the giving of that copy of the election is unnecessary, unreasonable or impracticable in the circumstances of the case. 17
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (5) In making an order under subsection (4), the Court may order that a copy of the partner's property election must be given to any other person specified by the Court in the order. 70T Revocation of partner's property election (1) A partner may revoke a partner's property election at any time before the property which is the subject of the election is transferred to the partner. (2) A revocation under subsection (1) must-- (a) be in writing; and (b) be given to-- (i) each of the persons referred to in section 70S(2), subject to any order under section 70S(4); and (ii) any person who was given a copy of the partner's property election by order of the Court under section 70S(5). 70U Court may make acquisition authorisation order if election applies to estate property which is part of larger aggregate (1) A partner of an intestate who makes a partner's property election must apply to the Court for an acquisition authorisation order authorising that acquisition if the property forms part of a larger aggregate and-- (a) the acquisition could-- (i) substantially diminish the value of the remainder of the property; or (ii) make the administration of the estate substantially more difficult; or 18
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (b) the election is a kind requiring the Court to determine the partner's legal or equitable interest in the property and an application to determine that interest has not been heard and determined. (2) An application for an acquisition authorisation order must be made within a reasonable time after the partner receives a copy of a valuation under section 70V(2). (3) On an application under subsection (1), the Court-- (a) may grant an acquisition authorisation order authorising the partner of the intestate to acquire the property under the partner property election; and (b) may impose any conditions that it considers just and equitable to address the matters referred to in that subsection, including determining the partner's legal or equitable interest in the property if not determined in another proceeding. Note See also section 24 of the Supreme Court Act 1986 in relation to costs. (4) Without limiting the conditions that the Court may impose on an acquisition authorisation order, the Court may impose a condition that the partner pay compensation to the estate in addition to consideration for the property. (5) The Court may refuse to make an acquisition authorisation order if it considers that the matters referred to in subsection (1) cannot be adequately addressed by making the order subject to conditions. 19
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy 70V Valuation of property which is subject of election (1) Subject to subsection (3), the intestate's personal representative must obtain a valuation of any property forming part of the intestate's estate as at the intestate's death from a valuer who holds the qualifications or experience specified under section 13DA(2) of the Valuation of Land Act 1960 if-- (a) a partner makes a partner's property election in relation to that property; or (b) a partner asks the personal representative to obtain a valuation to enable the partner to decide whether to make a partner's property election. (2) The personal representative must give a copy of the valuation to-- (a) the partner; and (b) each other beneficiary who is entitled to a share in the intestate's estate. (3) The requirement for a personal representative to obtain a valuation is waived if all the beneficiaries (including the partner) entitled to a share in the intestate's estate consent in writing to the requirement being waived. 70W How price of property to be satisfied and effect on residuary estate (1) If a partner makes a partner's property election to acquire property from an intestate's estate, the price for which the partner acquires the property (being the valuation or other agreed amount under section 70P) is to be satisfied-- 20
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (a) first from money to which the partner is entitled from the intestate's estate; and (b) if the money referred to in paragraph (a) is insufficient, from money paid by the partner to the estate on or before the date of transfer. (2) If a partner makes a partner's property election to acquire property from the intestate's estate-- (a) the partner's share of the residuary estate must be reduced by the price of the property; and (b) if the price of the property is more than the amount of the partner's share of the residuary estate, the partner must pay the difference into the intestate's estate before whichever of the following occurs first-- (i) the distribution of the residuary estate; (ii) the end of 12 months after making the partner's property election. 70X Timing of transfer to partner (1) If a partner makes a partner's property election to acquire property from an intestate's estate, the personal representative-- (a) must transfer the interest to the partner-- (i) within a reasonable time of receiving notice of the partner's property election under section 70S; or 21
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (ii) if section 70W(1)(b) applies, within a reasonable time of the partner paying the amount of the difference into the estate; or (iii) if an acquisition authorisation order is required, within a reasonable time after the order is made or such other time as the Court specifies in the order; and (b) in any event, must transfer the property before the distribution of the residuary estate. (2) Despite subsection (1), the personal representative must not transfer the interest to the partner if-- (a) the partner's property election is of a kind that requires the Court to make an acquisition authorisation order and-- (i) the acquisition authorisation order has been refused; or (ii) the application for an acquisition authorisation order has been withdrawn; or (iii) an application for an acquisition authorisation order has not been made; or (iv) an application for an acquisition authorisation order has been made but has not been determined; or (b) the partner has revoked the partner's property election. 22
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy 70Y Restriction on disposal of property from intestate's estate (1) This section does not apply if the partner is entitled to the whole of the intestate's estate. (2) The personal representative of an intestate must not dispose of property from the intestate's estate (except to a partner who has made a partner's property election) unless-- (a) the personal representative is the partner entitled to make the election; or (b) the time for exercising the election has elapsed and no election has been made; or (c) the election is of a kind that requires the Court to make an acquisition authorisation order but-- (i) the acquisition authorisation order has been refused; or (ii) the application for an acquisition authorisation order has been withdrawn; or (d) the partner has given written notice to the personal representative that the partner does not propose to exercise the right to make a partner's property election from the estate; or (e) sale of the property is required to meet funeral and administration expenses, debts or other liabilities of the estate; or (f) the property is perishable or likely to decrease rapidly in value. 23
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (3) A transaction entered into in contravention of subsection (2) is not invalid merely because of that contravention. Division 5--Distribution if intestate leaves multiple partners 70Z Distribution if intestate leaves more than one partner and no issue If an intestate does not leave any child or other issue but leaves more than one partner, the partners are entitled to the whole of the intestate's residuary estate-- (a) if there is a distribution agreement, in shares in accordance with that agreement; or (b) if there is a distribution order, in accordance with that order; or (c) in equal shares, in accordance with section 70ZE. 70ZA Distribution if intestate leaves more than one partner and child or issue of one or more of those partners If an intestate leaves more than one partner and a child or other issue who are also a child or other issue of one or more of those partners, the partners are entitled to the whole of the intestate's residuary estate-- (a) if there is a distribution agreement, in shares in accordance with that agreement; or (b) if there is a distribution order, in accordance with that order; or (c) in equal shares in accordance with section 70ZE. 24
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy 70ZB Distribution if intestate leaves more than one partner and child or issue not the child or issue of one or more of those partners (1) If an intestate leaves more than one partner and a child or other issue not a child or other issue of any of those partners, the partners are entitled-- (a) to share the personal chattels of the intestate as follows-- (i) if there is a distribution agreement, in shares in accordance with that agreement; or (ii) if there is a distribution order, in accordance with that order; or (iii) in equal shares in accordance with section 70ZE; and (b) if the intestate's residuary estate is worth not more than the amount of the partner's statutory legacy payable if the intestate had left only one partner, to share the residuary estate as follows-- (i) if there is a distribution agreement, in shares in accordance with that agreement; or (ii) if there is a distribution order, in accordance with that order; or (iii) in equal shares in accordance with section 70ZE; and (c) if the intestate's residuary estate is worth more than the amount of the partner's statutory legacy payable if the intestate had left only one partner, to-- 25
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (i) the amount of the partner's statutory legacy shared in accordance with paragraph (b); and (ii) interest on that partner's statutory legacy calculated at the legacy interest rate from the date of the death of the intestate to the date of payment of that legacy; and (iii) one half of the balance of the residuary estate as follows-- (A) if there is a distribution agreement, in shares in accordance with that agreement; or (B) if there is a distribution order, in accordance with that order; or (C) in equal shares in accordance with section 70ZE. (2) If subsection (1)(c)(iii) applies, any children of the intestate are entitled to the other half of the balance of the residuary estate, and if more than one, in equal shares. (3) If one or more of the intestate's children predeceased the intestate leaving issue who survived the intestate-- (a) the share of the deceased child is to be divided between that deceased child's children; and (b) if any of those grandchildren of the intestate predeceased the intestate leaving their own issue who survived the intestate, the deceased grandchild's share is to be divided between the 26
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy deceased grandchild's children and so on until the entitlement is exhausted. 70ZC Distribution agreement for sharing between more than one partner The partners of an intestate may enter into a written agreement for the distribution of the intestate's residuary estate between them. 70ZD Distribution orders (1) If an intestate leaves more than one partner, a partner may apply to the Court for a distribution order. (2) Unless the Court otherwise orders, if a personal representative has given notice under section 70ZE(1) an application for a distribution order must be made within 3 months after the date of the notice. (3) On an application for a distribution order, the Court may order-- (a) that the intestate's residuary estate be distributed between the partners in any way the Court considers just and equitable; and (b) without limiting paragraph (a), that the whole of the residuary estate be allocated to one of the partners to the exclusion of the other partner or partners. (4) A distribution order may include any conditions that the Court considers appropriate. 27
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy 70ZE Distribution between multiple partners in equal shares (1) Subject to subsection (3), the personal representative of an intestate who leaves multiple partners must distribute the residuary estate in equal shares between the partners if the personal representative, at the request of a partner of the intestate, or in the personal representative's discretion-- (a) gives each partner a written notice stating that the personal representative will distribute the estate equally between the partners unless, within 3 months of the date of the notice-- (i) the partners enter into a distribution agreement and submit that agreement to the personal representative; or (ii) at least one of the partners applies to the Court for a distribution order; and (b) at least 3 months have elapsed since the notices referred to in paragraph (a) were given and-- (i) the personal representative has not received a distribution agreement or notice of an application to the Court for a distribution order; or (ii) an application for a distribution order has been made but the Court has dismissed the application or the application has been withdrawn. 28
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (2) If the period specified in subsection (1)(b) has elapsed and no distribution agreement has been received and no distribution order has been made, the personal representative must distribute the intestate's residuary estate between the multiple partners in equal shares. (3) If the intestate leaves more than one partner and a child or children or other issue who are not also the child, children or other issue of any of the partners the residuary estate is to be distributed in accordance with section 70ZB. Division 6--Distribution if intestate leaves no partners 70ZF Application of Division If a person dies intestate in respect of the person's residuary estate and Divisions 3, 4 and 5 do not apply, the residuary estate is to be distributed in accordance with the hierarchy set out in this Division. 70ZG Distribution to children (1) If an intestate leaves no partner but leaves a child or children, the residuary estate is to be distributed to the surviving child, and if more than one, in equal shares if none of the intestate's child or children predeceased the intestate leaving issue of that child who survived the intestate. (2) If one or more of the intestate's children predeceased the intestate leaving issue who survived the intestate-- (a) the share of the deceased child is to be divided between that deceased child's children; and 29
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (b) if any of those grandchildren of the intestate predeceased the intestate leaving their own issue who survived the intestate, the deceased grandchild's share is to be divided between the deceased grandchild's children and so on until the entitlement is exhausted. 70ZH Distribution to parents (1) If an intestate leaves more than one parent but no partner, child or other issue, the residuary estate must be distributed equally between the parents. (2) If the intestate leaves one parent but no partner, child or other issue, the parent is entitled to the whole residuary estate. 70ZI Distribution to siblings (1) If an intestate leaves more than one sibling but no partner, no child or other issue and no parent, the residuary estate must be distributed equally between those siblings. (2) If the intestate leaves one sibling but no partner, no child or other issue and no parent, the sibling is entitled to the whole residuary estate. (3) If a sibling of an intestate predeceases the intestate leaving a child who survives the intestate, that child is entitled to the sibling's share and, if there are 2 or more children, in equal shares. 70ZJ Distribution to grandparents (1) If an intestate leaves more than one grandparent but no partner, no child or other issue, no parent, no sibling and no issue of a sibling, the residuary estate must be distributed equally between the grandparents. 30
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy (2) If the intestate leaves one grandparent but no partner, no child or other issue, no parent, no sibling and no issue of a sibling, the grandparent is entitled to the whole residuary estate. 70ZK Distribution to aunts and uncles or to cousins by representation (1) If an intestate leaves more than one aunt or uncle but no partner, no child or other issue, no parent, no sibling, no issue of a sibling and no grandparent, the residuary estate must be distributed equally between the aunts and uncles. (2) If the intestate leaves one aunt or uncle but no partner, no child or other issue, no parent, no sibling, no issue of a sibling and no grandparent, the aunt or uncle is entitled to the whole residuary estate. (3) If an aunt or uncle of an intestate predeceases the intestate leaving a child who survives the intestate, that child is entitled to the aunt or uncle's share and, if there are 2 or more children, in equal shares. 70ZL Crown to take estate if no person entitled If no person is entitled to the estate of an intestate under this Part, the residuary estate-- (a) is taken to be property that has no owner; and (b) passes to and belongs to the Crown.". 31
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 2--Amendments relating to intestacy 12 Court may make family provision order (1) In section 91(2)(d)(ii) of the Principal Act, for "Division 6 of Part I" substitute "Part IA". (2) In the note at the foot of section 91(2)(d)(ii) of the Principal Act, for "Division 6 of Part I" substitute "Part IA". (3) In section 91(2)(d)(iii) of the Principal Act, for "Division 6 of Part I" substitute "Part IA". 13 Contents of family provision order In section 97(4)(b)(i) of the Principal Act, for "Division 6 of Part I" substitute "Part IA". 32
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 3--Amendments relating to fees, commissions and other matters Part 3--Amendments relating to fees, commissions and other matters 14 Definitions In section 3(1) of the Principal Act insert the following definitions-- "interested beneficiary means a beneficiary of an estate whose entitlement to part of the residuary estate may be affected by the deduction of executor's remuneration from the estate; remuneration clause means a clause in a will that provides for remuneration of, or a commission or fees to be paid to, an executor for executorial services;". 15 Solvent estates--pecuniary legacies After section 39B(2) of the Principal Act insert-- "(3) A beneficiary entitled to a pecuniary legacy is entitled to interest on that legacy or any part of it that is not paid to the beneficiary within 12 months of the date of the deceased's death for the period that it remains unpaid calculated after that 12 month period at the legacy interest rate.". 16 New section 65A inserted After section 65 of the Principal Act insert-- "65A Reduction of excessive commission or fees (1) If the Court is satisfied that the amount of either or both of the following is excessive, the Court may order that it be reduced or repaid to the estate-- 33
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 3--Amendments relating to fees, commissions and other matters (a) a commission or fee charged or retained by an executor or administrator or payable to an executor or administrator under the terms of a will; (b) any fee, cost, expense or disbursement for which an executor or administrator has been reimbursed or claims to be reimbursed out of an estate. (2) The Court may make an order under subsection (1)-- (a) on the application of-- (i) any person interested under the will or the estate, including any interested beneficiary; or (ii) any creditor; or (b) of its own motion. (3) This section does not apply to State Trustees.". 17 New sections 65B to 65E inserted At the end of Subdivision 3 of Division 7 of Part I of the Principal Act insert-- "65B Benefits to executor under remuneration clause A personal representative who is an executor of a will is not entitled to receive payment under a remuneration clause in the will unless-- (a) the testator gave written informed consent to the inclusion of the remuneration clause; and (b) that written informed consent was given by the testator before the will was executed. 34
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 3--Amendments relating to fees, commissions and other matters 65C Consent to executor's remuneration by interested beneficiaries (1) An executor of a will may receive fees or commission from the assets of the estate of the deceased person if the executor has obtained informed consent from each interested beneficiary and-- (a) there is no remuneration clause in the will; or (b) a remuneration clause in the will does not authorise the type of remuneration sought or taken by the executor; or (c) a remuneration clause does not entitle the executor to remuneration because written informed consent for the remuneration clause was not obtained from the testator in accordance with section 65B. (2) Subsection (1) does not apply to an executor that is a trustee company. 65D Information to be provided by an executor to interested beneficiaries (1) As soon as reasonably practicable, an executor of a will who seeks to be paid must inform each interested beneficiary of the following-- (a) the basis on which the executor is to be paid, being either in accordance with-- (i) a clause in the will; or (ii) with the consent of the interested beneficiaries under section 65C; or (iii) an order of the Court made under section 65; 35
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 3--Amendments relating to fees, commissions and other matters (b) the method of calculation of the payment to be made to the executor, including whether the payment will be-- (i) a commission or percentage of the assets of the estate and, if so, the applicable commission or percentage; or (ii) by charging fees; (c) the estimated value of the payment to be made to the executor; (d) the right of any interested beneficiary to have the payment claimed or charged by the executor reviewed by the Court under section 65A(2)(a)(i). (2) If an executor of a will becomes aware that there is likely to be a substantial change in the amount referred to in subsection (1)(c), the executor must inform each interested beneficiary of the change as soon as reasonably practicable. (3) The information given to each interested beneficiary under subsections (1) and (2) must be in plain language and-- (a) in English, or in another language if the interested beneficiary does not have sufficient knowledge of the English language; and (b) verbally if an interested beneficiary is illiterate. (4) An executor must make reasonable efforts to provide the information in subsection (1) or (2) to-- (a) the parent or guardian of a minor who is an interested beneficiary; 36
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 3--Amendments relating to fees, commissions and other matters (b) the guardian, administrator or attorney of an adult who does not have legal capacity or decision making capacity and is an interested beneficiary. (5) An executor who contravenes this section is not entitled to payment from the estate of-- (a) a commission or percentage of the assets of the estate; or (b) fees. (6) This section does not apply to an executor that is a trustee company. 65E Executor may elect to charge fees instead of commission If a will provides for an executor to charge commission, the executor may instead elect to charge fees for executorial services if the fees are-- (a) less than the amount to which the executor would have been entitled if the executor had not made the election; and (b) calculated at a rate that does not take into account any specialist professional skills of the executor; and (c) distinguished from any fees charged for professional services.". 18 Concealment of will a misdemeanour (1) In section 66(1) of the Principal Act, for "aids or abets any person in" substitute "is involved in". (2) At the foot of section 66(1) of the Principal Act, insert the following note-- "Note See sections 323 to 324C of the Crimes Act 1958 in relation to complicity in the commission of offences.". 37
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 3--Amendments relating to fees, commissions and other matters 19 New sections 106 to 108 inserted At the end of Part IVA of the Principal Act insert-- "106 Transitional provisions--Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 (1) The amendments made to this Act by the Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 apply in respect of the estate of any person who dies on or after the commencement of the applicable amendment to this Act. (2) Despite subsection (1), sections 65B, 65C and 65D only apply to a will executed on or after the commencement of those sections. 107 Power to resolve transitional difficulties in proceeding--Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 (1) If any difficulty arises because of the operation of the Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 in relation to an application or a proceeding under this Act, the Court may make any order it considers appropriate to resolve the difficulty. (2) An order made under subsection (1)-- (a) may be made on application of a party to the application or proceeding or on the Court's own motion; and 38
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 3--Amendments relating to fees, commissions and other matters (b) has effect despite any provision to the contrary made by or under any Act (other than the Charter of Human Rights and Responsibilities Act 2006). 108 Regulations dealing with transitional matters--Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 (1) The Governor in Council may make regulations containing provisions of a transitional nature, including matters of an application or savings nature, arising as a result of the enactment of the Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017, including any repeals and amendments made by any provision of that Act. (2) Regulations made under this section may-- (a) have a retrospective effect to a day on or from the date that the Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 receives the Royal Assent; (b) be of limited or general application; (c) differ according to differences in time, place or circumstances; (d) leave any matter or thing to be decided by a specified person or specified class of persons; 39
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 3--Amendments relating to fees, commissions and other matters (e) provide for the exemption of persons, applications or proceedings or a class of persons, applications or proceedings from any of the regulations made under this section. (3) Regulations made under this section have effect despite anything to the contrary-- (a) in any Act (other than the Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 or the Charter of Human Rights and Responsibilities Act 2006); or (b) in any subordinate instrument. (4) This section is repealed on the second anniversary of the day on which it comes into operation.". 40
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 4--Amendments relating to ademption Part 4--Amendments relating to ademption Division 1--Amendment of the Principal Act 20 New sections 50 and 51 inserted After section 49 of the Principal Act insert-- "50 Court powers where exception to ademption causes unjust advantage or unjust disadvantage (1) A beneficiary under a will may apply to the Court if any beneficiary under the will gains an unjust advantage or suffers an unjust disadvantage by the application of-- (a) section 53 of the Guardianship and Administration Act 1986; or (b) section 83A of the Powers of Attorney Act 2014. (2) If the Court is satisfied that a beneficiary under the will gains an unjust advantage or suffers an unjust disadvantage, the Court may make any order it thinks fit to remedy the unjust advantage or unjust disadvantage, as the case may be. (3) Without limiting the powers of the Court, an order under subsection (2) may direct that a conveyance, deed or any other document be executed or any other action be taken. (4) In this section-- unjust advantage means an unjust or a disproportionate advantage of a kind not contemplated by the testator in the will; 41
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 4--Amendments relating to ademption unjust disadvantage means an unjust or a disproportionate disadvantage of a kind not contemplated by the testator in the will. 51 Beneficiary entitled to traceable income from sale of adeemed assets A beneficiary under a will to whom section 53 of the Guardianship and Administration Act 1986 or section 83A of the Powers of Attorney Act 2014 applies is entitled to any traceable income or capital gain generated from the proceeds of sale or disposal of the property referred to in those sections to the extent that the income or capital gain has not been applied under the powers referred to in the applicable section.". Division 2--Amendment of the Guardianship and Administration Act 1986 21 Interest of represented person in property not to be altered by sale or other disposition of property (1) In section 53(1) of the Guardianship and Administration Act 1986-- (a) for "her or his heirs, executors, administrators, next of kin, devisees, legatees and assigns" substitute "a beneficiary of a represented person"; (b) for "she, he or they" substitute "the person or beneficiary". 42
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 4--Amendments relating to ademption (2) For section 53(3) of the Guardianship and Administration Act 1986 substitute-- "(3) An administrator is not required to keep the proceeds of the sale or other disposition of property under this section separate from the represented person's other assets.". (3) For section 53(5) of the Guardianship and Administration Act 1986 substitute-- "(5) In this section, beneficiary of a represented person means-- (a) a beneficiary under the will of a represented person; or (b) a represented person's executor; or (c) a represented person's administrator under the Administration and Probate Act 1958.". 22 New section 53A inserted After section 53 of the Guardianship and Administration Act 1986 insert-- "53A Exception to ademption applies regardless of testamentary capacity Section 53 applies whether or not the represented person has testamentary capacity.". 23 Application to the Tribunal by a creditor etc. After section 56(1) of the Guardianship and Administration Act 1986 insert-- "(2) In subsection (1), next of kin in relation to a represented person means any person who would be entitled to the property of the represented person or to any share of that property under any law for the 43
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 4--Amendments relating to ademption distribution of the property of intestates if the represented person had died intestate.". Division 3--Amendment of the Powers of Attorney Act 2014 24 New sections 83A and 83B inserted After section 83 of the Powers of Attorney Act 2014 insert-- "83A Interest of principal in property not to be altered by sale or other disposition of property (1) A principal and a beneficiary of a principal have the same interest in any money or other property arising from or received in respect of any sale, mortgage, exchange, partition or other disposition under the powers given to an attorney under an enduring power of attorney which have not been applied under those powers that the principal or beneficiary would have had in the property the subject of the sale, mortgage, exchange, partition or disposition if no sale, mortgage, exchange, partition or disposition had been made. (2) For the purposes of this section, money arising from the compulsory acquisition or purchase under any Act of property of a principal is taken to be money arising from the sale of that property under the powers given to the attorney under the enduring power of attorney. (3) An attorney under an enduring power of attorney is not required to keep the proceeds of the sale or other disposition of property under this section separate from the principal's other assets. 44
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 4--Amendments relating to ademption (4) Money received by an attorney under an enduring power of attorney under this section may be invested in any manner in which trust funds may be invested under the Trustee Act 1958. (5) In this section, beneficiary of a principal means-- (a) a beneficiary of a principal under a will; or (b) a principal's executor; or (c) a principal's administrator under the Administration and Probate Act 1958. 83B Exception to ademption applies regardless of testamentary capacity Section 83A applies whether or not the principal has testamentary capacity.". 25 New Division 7 inserted in Part 8 After Division 6 of Part 8 of the Powers of Attorney Act 2014 insert-- "Division 7--Powers of VCAT with respect to wills 134A VCAT may open will VCAT may open and read any paper or writing that is a will, a revoked will, a purported will or a copy of a will of-- (a) a principal under an enduring power of attorney who does not have testamentary capacity; or (b) a deceased person who, immediately before the person died, was a principal under an enduring power of attorney. 45
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 4--Amendments relating to ademption 134B VCAT may compel production of will VCAT may make an order compelling a person who has possession or control of a will, a revoked will or a purported will of a principal who does not have testamentary capacity to produce that document to VCAT-- (a) for the purposes of section 134A; or (b) on the application of an attorney under an enduring power of attorney. 134C VCAT may make copy of will available to attorney VCAT may make available to an attorney under an enduring power of attorney a full or redacted copy of a will, a revoked will or a purported will of the principal if the principal does not have testamentary capacity.". 46
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 5--Consequential amendment of other Acts and repeal of amending Act Part 5--Consequential amendment of other Acts and repeal of amending Act 26 Marriage Act 1958--Abolition of husband's liability for wife's torts and ante-nuptial contracts debts and obligations In section 159(3) of the Marriage Act 1958, for "Division six of Part I" substitute "section 3(1)". 27 Trustee Companies Act 1984--Trustee company to be subject to same duties as individual In section 25(1) of the Trustee Companies Act 1984, after "provided in this Act" insert "and subject to sections 65C and 65D of the Administration and Probate Act 1958". 28 Wills Act 1997--Definitions In section 3(1) of the Wills Act 1997 insert the following definition-- "remuneration clause has the same meaning as it has in the Administration and Probate Act 1958;". 29 Wills Act 1997--New section 49A inserted After section 49 of the Wills Act 1997 insert-- "49A Effect of remuneration clause A remuneration clause in a will is void unless-- (a) the testator gave written informed consent to the inclusion of the remuneration clause; and (b) that written informed consent was given by the testator before the will was executed.". 47
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Part 5--Consequential amendment of other Acts and repeal of amending Act 30 Wills Act 1997--New section 56 inserted At the end of Part 6 of the Wills Act 1997 insert-- "56 Transitional provision--Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 Section 49A only applies to a will executed on or after the commencement of that section.". 31 Repeal of amending Act This Act is repealed on 1 November 2018. Note The repeal of this Act does not affect the continuing operation of the amendments made by it (see section 15(1) of the Interpretation of Legislation Act 1984). ═══════════════ 48
Administration and Probate and Other Acts Amendment (Succession and Related Matters) Act 2017 No. of 2017 Endnotes Endnotes 1 General information See www.legislation.vic.gov.au for Victorian Bills, Acts and current authorised versions of legislation and up-to-date legislative information. Minister's second reading speech-- Legislative Assembly: Legislative Council: The long title for the Bill for this Act was "A Bill for an Act to amend the Administration and Probate Act 1958 in relation to intestacy and other matters relating to the administration of estates, including fees and commissions, to amend that Act, the Guardianship and Administration Act 1986 and the Powers of Attorney Act 2014 in relation to ademption, to consequentially amend other Acts and for other purposes." By Authority. Government Printer for the State of Victoria. 49