Interstate And Overseas Assets
An important factor in the administration of a deceased estate is the deceased’s domicile, as this will establish the appropriate jurisdiction. A deceased estate is probated in the jurisdiction where the testator was domiciled at the time of death, or where the majority of the assets of the estate are held. This can present a problem if a testator owned assets in several states or territories or even overseas. This article explores the way interstate and overseas assets are treated in the administration of a deceased estate.
Domicile law refers to the location where the deceased lived, had a connection to or where the deceased kept a permanent residence. A testator is deemed a resident for domicile law purposes if they resided there for a period of at least six months before they died. For instance, if a deceased Australian citizen had assets in New South Wales and France, but lived in Queensland for several years prior to death, then any moveable assets could be dealt with in accordance with Queensland succession law.
One of the first acts of an executor or administrator is to compile a list of the assets of the deceased and collect them together for safekeeping until they can be used to pay the liabilities of the estate and then distributed to the rightful beneficiaries. When there are interstate assets located within Australia in another jurisdiction, the executor must submit an application to the relevant Supreme Court in that jurisdiction for a reseal of the will. That means that in many jurisdictions an executor will need to advertise their intention to apply for a reseal before filing with the court. This reseal is legal recognition of the validity of another jurisdiction’s Grant of Probate or Letters of Administration.
Overseas assets are often classified as either “moveable” or “non-moveable” assets. The law of the testator’s permanent residence applies to moveable assets held outside Australia like shares, artwork and funds in bank accounts. By contrast, the relevant overseas law applies to non-moveable overseas assets such as real property.
Australian wills are recognised in many countries. Commonwealth countries will typically reseal a Grant of Probate issued within Australia. Australia is also a signatory to the UNIDROIT convention, signed by twenty countries. This means that many European Union countries will allow an Australian testator to apply their country of nationality’s law to the assets held in the foreign country. For instance, if a Queensland resident owns a property in France, they can choose to have it administrated according to Queensland succession law. Armstrong Legal can also help you to make an international will that abides by the formalities common to the convention.
The situation becomes more complicated in countries where there is no reciprocal recognition. In such countries, it is usually necessary to appoint a foreign agent to deal with an overseas non-movable asset. For instance, when a Queensland testator owns land in Beijing, Chinese law applies and the asset will have to be handled differently than the rest of the deceased estate. In this situation, it would be wise to appoint a lawyer in China to deal with those assets.
Some movable assets held in another jurisdiction do not require a reseal. For instance, as an asset, shares are “located” in the jurisdiction of the registered address of the company’s head office. A reseal of the Grant of Probate is not necessary for such an asset unless there are additional assets located in the jurisdiction. Instead, an executor can send a certified copy of the Grant of Probate to the applicable company with appropriate forms.
If the deceased held a small amount of funds in an interstate or overseas bank, it may not be necessary to apply for a reseal in that jurisdiction. A bank will often have a policy that if the balance is under a certain threshold, they will turn over the asset upon receipt of the foreign Grant of Probate and if the executor is willing to sign documentation assuming responsibility and waiving the bank’s liability.
Making A Foreign Will
A testator with assets overseas can choose to prepare a foreign will that will be probated and administrated in the foreign jurisdiction. This foreign will is prepared by a solicitor in the jurisdiction to fulfil local requirements and operates parallel to the Australian will. However, care should be exercised, as succession law can be quite different to Australian succession law. For instance, some countries have laws of forced heirship tied to religious law that provides family members with a right to inheritance. Some countries also have inheritance taxes that must be applied to an overseas asset.
It can be difficult, time-consuming and costly to administer a deceased estate that includes interstate and overseas assets. The contested wills team at Armstrong Legal has extensive experience with this type of complicated deceased estate administration and can assist you with any of your legal needs. Please telephone our solicitors on 1300 038 223 without delay or make an appointment using this form.