What Happens To A Person’s Stuff When They Die?

What happens to a person’s stuff when they die depends on whether the deceased made testamentary arrangements before their death. When a person has left a valid will, their property is distributed according to their stated wishes. Otherwise, the assets in an intestate deceased estate are divided amongst family members according to relevant succession law. This article explains what happens to a person’s stuff when they die in Australia.

Who Determines What Happens To A Person’s Stuff When They Die?

There are some things that happen automatically to a person’s stuff when they die. Jointly owned assets are usually automatically transferred to the surviving co-owner. For instance, when someone owns real property in joint tenancy with another person, the asset reverts to the sole ownership of the survivor when one tenant passes away. The same right of survivorship applies to joint bank accounts. Some insurance policies and superannuation accounts also operate outside the normal pattern of distribution. If a deceased made a binding death benefit nomination, then the selected beneficiary automatically receives the benefit without waiting for probate.

For all other possessions, a testator needs to leave clear testamentary instructions on what should happen to their stuff when they die. A solicitor can help someone draw up a will that comprehensively accounts for a testator’s real property, financial assets and personal possessions. A testator can arrange for their stuff to be distributed through absolute bequests (simple gifts), conditional bequests (where the beneficiary must meet certain conditions to receive the bequest), or even through a more complicated instrument called a testamentary trust (which gives a testator much greater control of what happens to their stuff even after their death).

A testator needs to be aware that even when they make a valid will, what happens to their stuff when they die may not always go as planned. While a testator can leave whatever testamentary instructions they like, certain people are entitled to contest these arrangements. If an eligible person makes a successful claim against a deceased estate, what happens to a person’s stuff when they die is ultimately up to a Supreme Court.

Making a will does provide a testator with the opportunity to select the person (executor) that they want to administer their deceased estate. A testator can name one or more executors in their will to handle the distribution of their stuff when they die. The executor will safeguard the assets of a deceased until it is time to pass them on to the rightful beneficiaries. The executor is also tasked with dispensing with items that have no actual or sentimental value. For example, an executor sometimes has to clear a house of a deceased’s personal belongings, from emptying the fridge to disposing of toiletries.

What Happens To A Person’s Stuff When They Die Intestate?

When a person dies without making a will (that is, when they are intestate), they do not have a chance to choose an executor.  Instead, a Supreme Court in the relevant jurisdiction appoints an administrator to manage an intestate person’s stuff when they die. The Courts prefer to appoint a next of kin as administrator, but any suitable person can apply, including a creditor of the deceased estate.

Instead of the deceased choosing who will inherit their property, an intestate estate is divided in line with state or territory succession legislation.  For instance, in New South Wales, the Succession Act 2006 honours the rights of the de facto partner or spouse to inherit everything from an intestate estate. The children of the deceased only receive provision from an intestate estate in NSW if they are not the child of the current spouse or de facto partner.

Under an intestate estate, no bequests are made to other family members, favourite charities or close friends. The deceased has no say in what happens to their stuff when they die. Even if the deceased would be happy for their spouse to inherit everything, it is still important to make a will, as this will save the family trouble and expense.

What happens to a person’s stuff when they die all depends on the deceased’s estate planning. If the deceased prepared a valid, comprehensive and fair will, then their assets should be distributed according to their wishes, and an executor of their choosing will look after their stuff when they die. On the other hand, if the will is contested, or the deceased fails to make a will, then what happens to the deceased’s possessions depends on statutory rules and judicial decisions. The contested wills team at Armstrong Legal can provide advice tailored to your particular circumstances. Please get in touch with our offices to arrange an appointment on 1300 038 223.