Difference Between Grant of Probate and Letters of Administration
The most important difference between a Grant of Probate and Letters of Administration is that they are required under different circumstances. When someone dies with a valid will, it may be necessary to apply for a Grant of Probate; if someone dies without a valid will, and there are assets to distribute, then someone needs to apply for Letters of Administration. Unfortunately, the application process for both a Grant of Probate and Letters of Administration can be quite complicated and differs between states and territories, so it is not possible to provide a definitive guide. Some general observations about the differences between Grant of Probate and Letters of Administration are set out below, but specific advice should be sought from a solicitor practising in the jurisdiction where a grant is required.
What is a Grant of Probate?
When someone dies leaving a will, it is often necessary to seek a Grant of Probate from the Supreme Court. A Grant of Probate is a court document that recognises that someone has the authority to administer the estate of a deceased person. The document confirms that the will is valid and that the executor should distribute the assets as instructed in the will.
When is a Grant of Probate Required?
An institution (such as a bank) may require a Grant of Probate before it will release assets, even if there is a valid will in place. This is essentially a risk-mitigation strategy. The bank or other institution does not want to take the responsibility of releasing the asset based on a will that might later turn out to be invalid. The bank is satisfied with a court-ordered Grant of Probate that essentially confirms that the will is valid and instructs the bank to comply. Institutions will often have a policy that smaller assets (for instance, bank accounts containing less than $10,000) can be released without a Grant of Probate because there is an acceptable level of risk in relation to smaller assets.
A Grant of Probate is usually only required when the testator had assets that were solely owned. For instance, if the deceased’s only major asset was a jointly owned house with their spouse, there is no need for a Grant of Probate because ownership of the house will automatically transfer to the surviving owner. Similarly, if a bank account is held jointly, then there is no need for a Grant of Probate because the surviving signatory will have full ownership of the account. There are also special rules in many jurisdictions in relation to real property: in these states and territories, even if a property is owned solely in the name of the deceased, the registry can transfer the property without a Grant of Probate.
An executor should contact the institutions holding the assets of the deceased to enquire whether a Grant of Probate is required. Alternatively, a solicitor can help an executor understand whether a Grant of Probate is needed, based on an assessment of the nature and value of the assets left in the estate.
Who Applies for a Grant of Probate?
The executor of a will usually applies for a Grant of Probate from the Supreme Court. It may be helpful to seek the help of a solicitor in completing the application, especially as the rules are different in each state and territory, but it is also possible for the executor to complete the application without assistance.
What is a Grant of Letters of Administration?
When someone dies intestate (without a valid will), it is necessary to apply to the court for a Grant of Letters of Administration. As there is no will, no executor has been appointed to administer the estate. As a result, Letters of Administration are required to give someone the authority to distribute the assets of the deceased according to the rules set out in intestacy legislation.
There is a second circumstance where it is necessary to apply for Letters of Administration. This is where there is a valid will, but someone other than the executor named in the will needs to apply for authority to distribute the estate. In this case, the court will grant Letters of Administration, essentially giving the applicant the power to act as an executor and distribute the assets of the estate.
Who Can Apply for Letters of Administration?
Usually, the person who is likely to inherit the assets of the deceased will apply for Letters of Administration. The court commonly grants Letters of Administration to the spouse of the deceased, a child of the deceased, or a Trustee where there is no next of kin.
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