Probate in VIC
The right to administer an estate of a deceased person depends on whether the deceased died with, or without, a Will.
If a person has died leaving a Will which names an executor to manage the estate, the executor has the right to apply to the Probate Office of the Supreme Court to be formally recognised as the legal personal representative of the estate of the deceased. If the Probate Office accepts the application, it will grants a certificate, or “Probate Parchment”, which formally recognises the executor’s position as the legal personal representative of the estate.
The Probate Parchment is used by the executor to deal with the assets of the deceased’s estate. This allows the executor to “call in and collect” the assets of the deceased, which includes:
- legally selling any real estate belonging to the deceased;
- legally selling any shares, or other investments of the deceased;
- transferring bank accounts into the name of the executor as trustee for the estate of the deceased;
- if necessary, selling any personal effects of the deceased;
Once the assets of the estate are sold, the executor has a duty to first payout any debts and liabilities of the deceased and place the balance of the sale proceeds into an estate account for distribution in accordance with the terms of the Will. Distribution can take place 6 months after the date probate was granted to the executor (“the statutory administration period”). The statutory administration period is generally the same across most Australian states. However, if a challenge against the estate for proper provision has been brought within the statutory administration period, the executor must not distribute the remaining assets of the estate until the claim is resolved (See Contesting a Will).
In nearly all cases, banks, other financial institutions, share brokers and real estate agents will require a formal grant of Probate before they will deal with the executor and release any assets.
As an executor, it is recommended that Probate be obtained before dealing with any assets of the estate. The reason for this is that a person who “meddles” with the assets of the estate without a grant of Probate can be held personally liable by the beneficiaries of the Will, or a person contesting the estate, for any losses incurred as a result of not having that authority from the Court.
Once Probate is granted, the executor has specific duties and obligations to be performed. Those duties and obligations are found, primarily, in the following acts:
- Administration and Probate ACT 1958 (VIC);
- Trustee ACT 1958 (VIC)
An executor is given certain protections under the above acts when dealing with the assets of an estate, provided they have a grant of Probate.
What is Probate?
Probate is a document issued by the court certifying that the Will of a deceased person is valid and legal. The Administration and Probate ACT 1985 (VIC) provides that:
“The court shall have jurisdiction to grant probate of the Will or the administration of the estate of any deceased person leaving property whether real or personal within Victoria.”
Probate effectively starts the process of winding up all the affairs of a deceased person.
What if there is No Will?
If a person dies without a Will, known as an “intestacy”, the person with the greatest interest in the deceased’s affairs (usually a spouse or a defacto partner), has the right to apply for “Letters of Administration” (“LOA”). This can be a complicated procedure which requires a number of supporting documents to be prepared and filed by the person making the application. As with a grant of Probate, an applicant must not deal with the assets of the deceased until the grant of LOA is made by the Supreme Court.
Who is Entitled to Apply for a Grant of Probate?
The executor(s) named in the Will may apply for a Grant of Probate. If an executor predeceases the deceased, and there is:
- no surviving executor; or
- the surviving executor is no longer available; or
- he or she renounces probate.
Then an application ought to be made to the court for the grant of Letters of Administration with the Will annexed to it. The preferred applicant shall be the principal residuary beneficiary with the greatest interest in the Will.
When is a Grant of Probate Required?
Probate is required when a deceased person dies with a Will leaving property ie. real or personal property, within Victoria.
It is the physical location of the property at the date of death which is relevant for the purpose of deciding whether probate is required in Victoria.
What are the Rights and Duties of an Administrator?
An administrator has an important, and a powerful role in the administration of a deceased’s estate. An administrator requires the grant of Letters of Administration to deal with the estate or the Will of a deceased person. The rights and main duties of an administrator are:
- to arrange for the disposal of the body;
- advertise, and to pay the debts and tax owed by the deceased, and the estate;
- maintain proper accounts;
- collate all assets;
- provide information on assets, and disclose liabilities
- to invest;
- distribute estate.
The administrator has to ensure that statutory beneficiaries receive their entitlements in accordance with the Administration and Probate ACT (VIC).
Who can Apply for a Grant of Administration?
An application for the grant of Letters of Administration may be made:
- with a Will annexed to the application. This is explained in the section Who is entitled to apply for a Grant of Probate / Letters of Administration; or
- where the deceased dies intestate without a Will. In this situation, the spouse or domestic partner of the intestate deceased would be the proper applicant. If there is no spouse or domestic partner, the beneficiary with the greatest entitlement would be the preferred applicant, and if there are equal entitlements, the court has the discretion to appoint as it deems fit.
How to Apply for Probate
The application process for probate requires the drafting of court documents (application), and the preparation of an affidavits for the executor(s), an affidavit listing the inventory of assets and liabilities, an affidavit setting out the publication of notices and searches, and a final order(s).
The Probate Registry is particular with the accuracy and correctness of these court documents, and requires strict compliance with the rules of procedure when the documents are filed in the Registry.
At Armstrong Legal we are able to assist you with your application for Probate or Letters of Administration.
When is a Grant of Administration Required?
An application for Letters of Administration is required when a deceased person dies without leaving a Will (dies intestate), and has real and personal property within Victoria which must be distributed to statutory beneficiaries.
An application for Letters of Administration may also be applied with a Will annexed to the application. For details, refer to ‘Who is entitled to apply for a grant of Probate / Letters of Administration.
At Armstrong Legal we are able to assist you with your application for Probate or Letters of Administration.
Steps in Applying for a Grant of Probate
A grant of probate is not always required before an executor can deal with the assets of a deceased estate. If the deceased owned real estate or land as a proprietor with others in Victoria, a grant of probate or administration must be obtained before conducting any dealing with the real estate.
A grant of probate may not be required in the following circumstances:
- the deceased did not own any land;
- the assets of the deceased are relatively small;
- banks, financial institutions and other holdings allow dealings without a grant.
Before applying for probate it is necessary to:
- Prepare a list of all assets with current valuation in the name of the deceased at the time of death.
- If there are assets in the nature of bank accounts, investments, shares in companies, a letter should be sent to these institutions to notify them of the date of death, and to ascertain details of the deceased’s holdings.
- Conduct real estate searches in the name of the deceased.
At Armstrong Legal we can assist you with probate and administration matters.
Steps in Applying for a Grant of Letters of Administration
An application for Letters of Administration (“LOA”) generally takes place where the deceased person has died without a Will, otherwise known as an “intestacy”. If a grant of LOA is made to an eligible person, that person becomes the “administrator” of the Deceased’s estate.
The administrator is, effectively, the executor of an intestate estate.
In order to apply for LOA, the eligible person filing the application must prepare an affidavit in support of their application which states:
- that the applicant (if a natural person) is aged 18 years or over;
- that the deceased died intestate leaving property in Victoria;
- the date of death of the deceased;
- the marital status of the deceased;
- the nature of the relationship between the deceased and the eligible person;
- what relatives, or next of kin, have survived the deceased and their last known addresses;
- the right of the eligible person to bring the application (i.e – spouse, domestic partner, child)
- that a thorough search for any possible Will of the deceased has been undertaken and where those searches have taken place;
- exhibits the original death certificate;
- an inventory of assets and liabilities of the deceased as at the date of death.
In some cases, a grandchild of the deceased may apply for LOA where the parent (the child of the deceased) had died before the grandparent. In that situation, the application would need to state:
- that the deceased’s spouse predeceased the deceased;
- that the deceased’s spouse predeceased the deceased;
- that the deceased’s only child / children predeceased the deceased;
- that the deceased was survived by children of the deceased child;
- whether these children are over the age of 18 years.
LOA may also be granted where there are problems in the Will which do not satisfy the requirements for a grant of Probate. This is known as LOA with the Will annexed. Such situations may include:
- where the original Will cannot be located and a copy is only available;
- where the Will has not complied with the requirements of a formal Will under the Wills ACT 1997 (VIC) (i.e – wrongfully signed / witnessed / draft with no executed copy).
As with an application for a grant of Probate, an application for LOA should be filed within 6 weeks after the date of death. However, this will depend on how quickly a death certificate is issued to the eligible person who intends to lodge the application. If an executor or administrator has not filed an application for a grant of Probate or LOA within that time and does not provide reasons or supporting evidence to show reasons for the delay, an application may be filed with the Court to prevent that person from filing the application and award that right to another eligible person.
If you have difficulty in preparing an application for a grant of Probate or LOA, please contact our office to see how we may be able to help.
Time Frame to Apply for a Grant of Administration
Where a person dies without leaving a Will, that person is said to have died “intestate”. The person with the most interest in the Deceased’s estate, usually a spouse, domestic / de facto partner or child applies to the Probate Court for a grant of Letters of Administration.
When a person dies without leaving a Will, the property of the Deceased and the right to apply for Letters of Administration rests with the State Trustees until the next of kin is notified.
However, if the next of kin is the spouse, domestic / de facto partner, child of the Deceased, that person may file an application for a grant of Letters of Administration without the estate having to be first passed through the State Trustees.
An application for a grant of Letters of Administration should be applied for as soon as possible after the receipt of the death certificate. The release of the death certificate takes approximately 1 to 3 weeks to be released to the next of kin.
If the next of kin has not applied for Letters of Administration after 6 weeks from the date of death without a valid explanation for the delay and has already received the death certificate, the next interested party may apply to the Supreme Court under Section 15 of the Administration and Probate ACT 1958 (VIC) to force the next of kin to lodge the application, or, alternatively seek to be appointed as the administrator.
If you are unsure of whether you need to apply for Letters of Administration, or have concerns regarding the delay of a next of kin applying for Letters of Administration, contact our office to discuss what options may be available to you.
How Long does it take to Obtain Probate?
In general, a Grant of Probate (or Letters of Administration where there is no Will), is made approximately between 5 and 15 working days from the date on which the Probate application is filed with the Probate Office of the Supreme Court of Victoria. The process in preparing an application may take up to 8 weeks beforehand as it will require an executor to do the following:
- Obtain the original death certificate for the Deceased. This may take anywhere between 5 days and three weeks depending on the circumstances surrounding the death of the Deceased. If the Deceased’s death is being investigated by the State Coroner’s Office, an Interim Death Certificate may be provided to the executor by the Coroner upon request, to help speed up the estate administration;
- Identify and value the assets of the Deceased. This may require property valuations or appraisals to be obtained if there is property involved. However, if the Deceased owns property in their capacity as a “Joint Tenant” with the surviving spouse, or partner, the Deceased’s share of the property will pass to the surviving spouse by what is known as the “Right of Survivorship”. In such circumstances, the Deceased’s ownership of real estate in this manner does not form part of his or her estate as it immediately passes to the surviving spouse;
- Contact any financial institutions with which the Deceased may have held savings / loan / investment accounts. This includes superannuation companies, particularly if the Deceased was known to have held more than one superannuation fund. If the superannuation fund informs the executor that there is a Binding Death Benefit Nomination (“BDBN”) made by the Deceased (i.e – nominating a beneficiary to receive the super fund upon death of the Deceased), the fund will not form part of the estate assets and does not have to be accounted for. If there is no BDBN, the trustees of the super fund may pay the death benefit into the estate, subject to any contest raised against the super fund by eligible persons as identified within superannuation legislation. These funds will be subject to taxation for which the executor should consult with their accountant;
- Soon after identifying the assets and liabilities of the Deceased and obtaining the death certificate, the executor should place an electronic advertisement of their intention to formally apply for a Grant of Probate on the Probate Page of the Supreme Court of Victoria. This advertisement must be advertised for a period of 14 days, after which the formal probate documentation may be lodged, if ready, with the Probate Office.
Although Section 15 of the Administration and Probate ACT 1958 (VIC) states that Probate of a Will should be applied for within 6 weeks from the date of death, there may be circumstances where this is not possible. Pursuant to this section, a disgruntled beneficiary may, upon application to the Supreme Court, force the executor to “prove” the Will for Probate, particularly if the executor has been lazy, slow or simply reluctant, for whatever reason, in filing a Probate application. In most circumstances, there are valid reasons why probate may be delayed. However, evidence of such reasons rests on the executor to prove to the Court.
Preparing an application for Probate can be difficult, confusing and time consuming. Contact us today to discuss how we can assist you through this complex process.
Costs Associated with Obtaining Probate:
In Victoria, the costs of formally applying for a Grant of Probate are as follows:
- For estates where the gross value is less than $1,000, the fee is $125.10;
- For estates where the gross value is more than $1,000, the fee is $320.00
These are the fees of the Supreme Court of Victoria, as at 14 December 2017 and increase each financial year. These fees do not include the preparation of a Probate application which is required before seeking a grant of Probate.
Prior to lodging the formal application for a Grant of Probate, an executor must advertise their intention to apply for a grant for a period of 14 days. In the past, this required placing an advertisement in a mainstream newspaper. With the advent of the internet and online technology, the advertisement only needs to be placed on the Supreme Court Website.
Once the 14 day advertisement period passes, steps must be taken to formally lodge the Probate application as quickly as possible. Any delays in filing the Probate application could allow a beneficiary to apply to the Court, seeking to take over the administration of the estate because of the delay caused by the executor. If a beneficiary is successful in this regard, the beneficiary may be entitled to have their costs of the application paid for by the executor personally.
The separate legal costs of preparing a Probate application depends on the size of the estate and the work required to prepare the supporting affidavit material for that application. This may involve talking with accountants, financial advisors and medical bodies to identify what the “gross” and “net” financial position of the estate is, for the affidavit as to the inventory of assets and liabilities of the estate. Much of this work is charged in accordance with the Supreme Court Scale rate, although there are some aspects of estate administration which can be complex, particularly where trusts are invovled and which are managed by a company who is acting as a trustee.
If you have any questions regarding the administration of a deceased estate, or preparing a Probate application, please contact our office to see how we can help.
Costs Associated with Obtaining Letters of Administration
As with applying for a grant of Probate, the filing fee for an application for Letters of Administration (where a person has died without a Will, i.e – dying intestate) in the Probate Office of the Supreme Court of Victoria is $320.00 (as at 24 October 2017). This fee may be paid from any funds presently in the estate. This fee increases every year on 1 July and is indexed to CPI increases.
If the administrator (an executor of intestate estate) has paid this fee out of their own pocket, the administrator is entitled to seek reimbursement from the estate at a later time if the estate has no immediate funds to pay the fee.
If the administrator pays for any expense associated with the administration of the estate out of their own pocket, the administrator must retain all invoices to account for those payments before reimbursing themselves. This will be important for the purposes of accounting for the debts and liabilities of the estate and the net amount for distribution, to all beneficiaries.
Revocation of a Grant
An application for a revocation of a grant of Probate or Letters of Administration may be made in the following circumstances:
- a later Will is found; or
- a Will is found after the grant of Letters of Administration (intestacy cases); or
- the validity of a Will is contested.
The application should be filed, in the proceeding in which the grant was made, by way of Summons together with an affidavit setting out the grounds why an order for revocation should be allowed by the court.
The Role of the Executor
In Victoria, the role of the executor is primarily governed by the following acts:
- Administration and Probate ACT 1958; and
- Trustee ACT 1958
The term “executor” is used when there is a Will which requires administration. If a person has died intestate (i.e – without a Will), the appropriate term is “administrator”.
The powers of an executor come into operation upon the death of the Will maker and are derived from the Will of the Deceased. The executor is responsible for the following:
- Take steps to confirm that the Deceased has in fact died. This may be necessary for situations where the Deceased has been missing for a number of years, or there are questions in relation to confirming the identity of the body of the Deceased;
- Arrange and pay for the funeral. This is sometimes done in conjunction with family members of the Deceased. However, if there is a dispute between family members regarding the funeral arrangements, the executor may exercise his or her authority to determine the final arrangements. In practice, this rarely happens as it causes family members significant grief. However, there are some instances where the executor may need to exercise their power in this manner to stop family disputes;
- Where there are shares and real estate owned by the Deceased, apply for and obtain a Grant of Probate.
- Identify, secure and call in the assets of the Deceased. This should be done as quickly as possible so as to avoid any claims by beneficiaries that the executor is wasting, or negligently reducing the value of estate assets. Executors have been known to be held personally liable for financial losses suffered by the estate as a result of financial mismanagement or negligence;
- Identify and payout (discharge) the liabilities of the estate as soon as possible;
- Ensure that all accounts in relation to the administration of the estate are managed and accounted for;
- Not to engage in any activity which may give rise to a conflict of interest between the administration of the estate and any work for which the executor may derive a personal benefit as a result of exercising their executorial duties;
- complete a final tax return for the estate;
- Effect distribution at the expiry of the statutory six month administration period after the grant of probate.
Where possible, it is always recommended that the executor engage appropriate professional assistance from lawyers, accountants and financial advisors in relation to managing the financial affairs of the estate. This reduces the risk to the executor for being sued by beneficiaries for financial mismanagement. This is especially of importance where the Deceased owned and operated a business which is still trading after death. Section 8 of the Trustee ACT 1958 authorises the executor / trustee to obtain such advice, the costs of which are to be borne by the estate.
If the executor is not a professional administrator, lawyer or accountant who is authorised by the Will to take their reasonable fees, or receive a commission from the estate for their administration efforts, the executor will need to seek an order from the Supreme Court to receive a commission for their reasonable pains and troubles. Alternatively, an executor may be entitled to a commission, provided the beneficiaries to the Will are 18 years or older and have all given their informed consent to do so. Any commission awarded is on the basis of a percentage of the capital and income of the estate and is capped at 5%.
Removal of Executor / Trustee
If an executor / trustee is negligent in their management of the estate’s assets and affairs, or engages in activity giving rise to a conflict of interest or which breaches the executor’s fiduciary (financial) duties to the beneficiaries of the estate, the beneficiaries of the estate can apply to Supreme Court to have the executor/trustee removed. It may also be possible for the beneficiaries to obtain an order from the Court requiring the executor/trustee to payback, or compensate the estate for any losses sustained as a result of mismanagement or negligence.
If you are an executor or trustee and are not sure of your role and responsibilities please contact us to discuss how we may help you.
Urgent Probate Applications
Most Probate and LOA applications can take between 6 to 12 weeks to be finalised after the date of death of the deceased. The speed at which an application is granted depends on the following:
- The time by which the death certificate is released to the executor;
- The identification and valuation of the assets of the deceased;
- Allowing for the mandatory “2 week” advertising period to pass on the Supreme Court’s website, showing an intention of the executor to apply for a grant of Probate of LOA;
- Responding to any “requisitions” from the Probate Office regarding concerns in relation to the information provided with the application.
In some cases, an urgent Probate, or LOA application can be applied for in the Supreme Court, for which the Court may order a “limited grant” of Probate or LOA to an executor to deal with a specific asset or transaction, which the deceased was involved in at the date of death. This is known as an Ad Colligenda Bona application. In most cases, such applications are made where the deceased has died during the sale of their house and settlement is scheduled to take place well before any time a formal grant of Probate or LOA can be obtained. The Court will order a limited grant to deal with the settlement of the property and place the balance of the proceeds of sale into a trust account, usually the trust account of the solicitor acting for the deceased in the sale, until such time that a formal grant of Probate or LOA is obtained.
If you are a named executor under a Will, or believe that you may be entitled to apply for Letter of Administration and are not sure of what you need to do in this regard, please contact our office to discuss how we can help you.
WHERE TO NEXT?
Have you been left out of a Will or treated unfairly? We offer a free assessment of your case and a no win no fee policy. We have a specialist team that deals only in Wills & Estates servicing NSW, VIC, QLD, ACT, SA & WA. The law relating to Wills and Estates can often be complex and confusing so we encourage you to make contact with our team.