By its very definition, the word ‘estate’ means the whole of one’s possessions, more particularly, all the property and debts left by one at death.

When added to make the term ‘Estate Planning‘, it means you will attempt to ‘speak from the grave‘, and plan the process whereby your earthly assets are divided/distributed amongst those you deem worthy or in need.

In other words, trying to ensure the chosen beneficiary (the right person/entity) receives the appropriate gift (or asset), so that either the recipient has a great home and/or be looked after, or a share in a business, or other assets, end up in the right hands, so the enterprise may continue.

Whilst sometimes difficult in a corporate setting, it is usually problematic when regarding a family business, because of the emotion that may be attached to any discussions in this matter.

If you are merely discussing cash, furniture, cars, collectables and inanimate objects, that usually comprise someone’s bequest, it is usually a cut-and-dried matter for the testator to gift, in a properly written “Last Will and Testament”.

There are many opportunities to structure your estate planning to make sure your loved ones are looked after.

Our attitudes about what makes up a family have advanced well past the traditional concept of a mum, dad and two kids. The era of blended families and same-sex and single parenting has well and truly arrived. In contrast with our parents’ generation, there are a lot more factors to take into account when making a will.

Willing out of family disputes

While not the most pleasant of financial tasks, making a will with clear instructions and keeping it up to date can save disputes with grieving family members later. It will also give your loved ones certainty and clarity about their financial position.

A solicitor can draft and execute your will, and will likely suggest things you may not have already considered. They may also offer to store your will securely for no extra fee.

If your beneficiaries have more complex family, financial or business needs (for example if your child has a disability or you’re in a family business), a testamentary trust can protect their interests.

These trusts offer flexibility regarding the distribution of income and assets, and this structure may provide tax advantages too.

However, if it is a business, this process becomes a part of another process called ‘Succession Planning’, where likely individuals are tested to see if they have the strength, integrity and fortitude necessary to take over from the founder, or their successors.

Maybe the identified successor doesn’t have the necessary skills, and must be groomed, mentored, educated and tempered over a period of time. When that time passes, maybe this individual does not yet measure-up, and must stay in a sub-ordinate role until ready.

This may mean a search for others within the business, or an outsider, to come in and to continue the mentoring role until the person is ready.

There may be no likely family member. Maybe the best option is to sell to the staff as a Management-Buy-Out (MBO); or a Management-Buy-In (MBI), where you sell to a team from the outside. It may be a Leveraged-Buy-Out or a Leveraged-Buy-In. These deals are usually done with a higher, or lower , level of equity and/or debt, respectively. This is where you may control the process a little. Else, you look for a Trade Sale, where a competitor (looking for larger market-share), or a new entrant buys the business.

In this way, the business goes out of the family and the cash and other assets realised, may go where directed/needed.

However, if the business will stay in the family, in whole or in part, maybe a Corporate Will is necessary to ensure the right people receive the correct share holding.

If any of the above resonates with you, and you need to understand more, come in for a conversation with me, about what the options are for you, and a Lawyer with commercial nous will be contacted if necessary or appropriate, to take matters to the next level, and document the process.

Regardless, as individuals, please ensure your Will has been revised by your lawyer, to ensure it is current; at least within the last five years, preferably three.

You should review and change the plan whenever you circumstances change, such as:

• You get married, divorced, begin living with or separate from a partner;
• You have children, or they pass away;
• You set-up, buy or sell a business;
• You incorporate a company;
• You set-up a trust;
• If you have family members with special needs;
• If you have a change in superannuation;
• If you buy real estate or other valuable assets.

Other matters to consider are as follows:

1. Have you planned to give your organs as a Donor to the transplant program?
2. Have you discussed your wishes with your family members?
3. If any dependent children under the age of 18-years old know with whom they will live in the event of your passing?
4. Do you have a current and valid will?
5. Have you appointed Limited and/or Enduring Powers of Attorney?
6. Do you have a suitable executor, and have you spoken to this person(s) to tell them of their responsibilities?
7. Do you have a plot to be buried in?
8. Are there explicit instructions regarding your funeral?
9. If you have a Self-Managed Super Fund, do you understand the effects to this structure, and the assets held within, upon your passing?
10. Have you made a Binding Death Nomination in regards your superannuation; either to the estate or individual dependents?
11. Should you set-up an actual Testamentary Trust for each dependent, like an Endowment, to look after their needs until age 25?
12. Do you want to make an in-specie or cash gift to a particular charity?
13. Do you understand the income and capital gains tax implications of your passing

What happens if someone makes a claim on your estate? Who might do this? How successful may they be?

The above is not an exhaustive list of the types of scenarios required to be considered in your estate plan. Estate Planning is more than just a will!

If you have any questions or would like to speak with one of our solicitors, please contact us.

An Advance Health Directive enables you to give directions about your health care in circumstances where you cannot personally tell your doctor or your family.

Every competent adult has the legal right to accept or refuse any recommended health care. This is relatively easy when people are well and can speak for themselves. Unfortunately, during severe illness people are often unconscious or otherwise unable to communicate their wishes—at the very time when many critical decisions need to be made. By completing an Advance Health Directive, you can make your wishes known before this happens.

What is an Advance Health Directive?

An Advance Health Directive is a document that states your wishes or directions regarding your future health care for various medical conditions. It comes into effect only if you are unable to make your own decisions.

You may wish your AHD to apply at any time when you are unable to decide for yourself, or you may want it to apply only if you are terminally ill.

Can anyone make an Advance Health Directive?

Yes, anyone who is over eighteen years of age and is capable of understanding the nature of their directions and foreseeing the effects of those directions can generally make an Advance Health Directive.

What do I need to consider before making an Advance Health Directive?

You should think clearly about what you would want your medical treatment to achieve if you become ill. For example:

• If treatment could prolong your life, what level of quality of life would be acceptable to you?
• How important is it to you to be able to communicate with family and friends?
• How will you know what technology is available for use in certain conditions?

It is strongly recommended that you discuss this form with your doctor before completing it. In addition, a doctor must complete Section 5 of the form.

The purpose of an Advance Health Directive is to give you confidence that your wishes regarding health care will be carried out if you cannot speak for yourself. However, a request for euthanasia would not be followed, as this would be in breach of the law. Under the Queensland Criminal Code, it is a criminal offence to accelerate the death of a person by an act or omission. It is also an offence to assist another person to commit suicide.

Can I cover all possible health-care decisions in this form?

No, it would not be possible to anticipate everything. However, if you wish, you can give someone enduring power of attorney to make health-care decisions on your behalf. If you have already given someone enduring power of attorney for personal/health matters, all you need to do is discuss this directive with that person and complete Section 6 when you come to it.

If you have not yet appointed anyone and you wish to do so, you will need to complete Section 7 of this form when you come to it.

You may also wish to give someone enduring power of attorney for financial matters in case you need someone to manage your property or money, e.g. if you are in a nursing home. If you wish to do that, you will need to complete a separate enduring power of attorney form.

Can I change or revoke my Advance Health Directive?

Yes, your wishes as stated in an Advance Health Directive are not final; you can change them at any time while you remain mentally capable of doing so. It is wise to review your AHD every two years or if your health changessignificantly.

If you do want to make changes to your directive, you should destroy the current one and make a new one.

You may also totally revoke your directive at any time. This must be done in writing, but no specific form is required and the person witnessing your signature does not need to be a justice of the peace, commissioner for declarations, lawyer or notary public. If you have any questions or would like to speak with one of our solicitors, please contact us.

It is important that someone else can look after your affairs if you cannot do so (eg you are overseas, or you lack mental capacity) whether for a short time (eg you are ill), or permanently ( eg because you have dementia or you are in a coma). An Enduring Power of Attorney continues to be in force after you lose capacity and can provide the Attorney with wide or limited powers.

What does a power of attorney do?

A power of attorney is a legal document in which you can appoint someone to act on your behalf in your financial matters such as payment of bills or legal matters or in some cases your personal matters such as where you live and other day to day affairs or health matters.

When you appoint somebody you are called the donor or principal and the person appointed is called a donee or attorney. A power of attorney does not give the attorney the right to execute a will on behalf of the donor, or to vote on behalf of the donor.

What is a general power of attorney?

The general power of attorney is used for financial decisions but not for personal or health decisions. A power of attorney can be appointed for a specific purpose or for a specific period of time eg while overseas or for just the sale of a house or it can be unrestricted. A power of attorney can also be restricted by law (for example an attorney cannot act in certain investments which are governed by the Trusts Act).

The general power of attorney is revoked (cancelled) if:

• the donor loses the mental capacity to manage their own affairs, or
• it is cancelled (revoked) by the donor using a document called a deed of revocation, or
• the donor dies, or
• the attorney becomes bankrupt, or
• the attorney loses the mental capacity to act.

What is an enduring power of attorney?

Enduring powers of attorney can cover financial matters or personal matters including some health matters. The other difference is that under an enduring power of attorney, the attorney can continue to act even if the donor becomes mentally incapacitated.

An enduring power of attorney comes into effect on the date it is made for financial matters. In the case of personal matters, it comes into effect on the date of incapacity. If you want it to start on another date you need to specify that in the document.

The following events will end the enduring power of attorney:

• it is cancelled (revoked) by the donor, using a document called Revocation of an Enduring Power of Attorney, or
• the donor marries. The power of attorney is revoked unless the donor’s new spouse is also their attorney. If so, then the power of attorney is only revoked for any other attorney they might have.
• the donor divorces. The power of attorney is revoked to the extent it was given to their former spouse.
• the donor dies
• the donor makes a later document such as another power of attorney which is inconsistent with the first document
• the attorney withdraws by giving the donor a signed notice
• the Queensland Civil and Administrative Tribunal appoints a new attorney
• the attorney becomes the donor’s paid carer or health care provider
• the attorney becomes incapable ie of understanding their decisions and communicating the decisions
• the attorney becomes bankrupt or insolvent
• the attorney dies.

Who can be an attorney?

An attorney does not have to be your lawyer. They can be the Public Trustee, Adult Guardian, or a friend or relative provided they are:

• over 18 years of age and understand the nature of the document
• not bankrupt
• not a paid carer or health care provider (does not include a person in receipt of a Carers Pension).

If more than one attorney is appointed, then the document should specify whether the attorneys can act individually or must act together.

Who cannot make a power of attorney?

A person who has an incapacity, which means that they do not understand the nature of the legal document.

The Power of Attorney form?

Powers of attorney must be prepared in the approved form and executed in the presence of an appropriate witness.

A copy of a power of attorney or an enduring power of attorney may be required to be lodged with banks, financial facilities, Centrelink and similar organisations before allowing the attorney to act on behalf of the donor.

A power of attorney must be stamped and registered with Land Titles Office in the Department of Natural Resources if it is to be used for dealing with real estate.

I have been appointed an attorney in an enduring power of attorney for a person (“the principal”) who has lost capacity. Their original enduring power of attorney has been lost. What do I do?

Where possible, you should search your home and business as well as the principal’s home and business to see if you can recover a certified copy of the enduring power of attorney. This includes any safes and safe deposit boxes you may have access to.

Alternatively, you should inquire with the principal’s solicitor, accountant, bank, financial planner or stockbroker to see if they hold a certified copy of the enduring power of attorney in safe custody.

If you cannot recover a certified copy of the enduring power of attorney, and the person has lost capacity, you will need to apply to the Queensland Civil and Administrative Tribunal (QCAT) to be appointed as their attorney. Depending on the complexity of the matter, you may need legal advice.

What are the obligations of an attorney?

The attorney has an obligation to keep the donor’s property separate to theirs and should keep a written record of all dealings with the donor’s affairs. The attorney must act honestly and keep confidentiality.

An attorney takes on serious responsibilities. If they do not observe their responsibilities they may be removed or even convicted of an offence or required to pay compensation.

Anyone who suspects that the power of attorney is not being used properly can inform the Adult Guardian. The Adult Guardian has the power to protect the donor’s interests when the donor is unable to do so. They can require the attorney to provide accounts and details about any decisions that have been made.

An application can also be made to the Queensland Civil and Administrative Tribunal where an attorney is acting improperly. An attorney who does not protect the donor’s interests adequately can be removed.

Is a power of attorney valid interstate and is an interstate power of attorney valid in Queensland?

Powers of attorney are made under state laws and a power of attorney made in one state may not be accepted in another. You should seek legal advice in the state you want to use the Power of Attorney in.

If you have any questions or would like to speak with one of our solicitors, please contact us.

Wills

Every adult or married person should have a Will and should regularly consider the contents of their Will, as their circumstances change and particularly when a person marries or separates or has children.

What Is A Will?

A will is a written document in which you state how you want your property distributed after you die. A person who makes a will is called a “testator”. Making a will allows you to choose what happens to your assets after you die. It also allows you to nominate an executor, who is the person responsible for making sure your wishes are met.

What Happens If I Die Without A Will?

If you die without having made a will, you are said to have died intestate. If this happens, your next of kin will have to apply to the Supreme Court for Letters of Administration, which will allow them to distribute your estate in a certain way. If you are the next of kin of someone who has died intestate, you should seek legal advice.

Who Can Make A Will?

You can make a will if you are over 18 years of age and are of sound mind. You must know that you are making a will, understand the nature and effect of the proposed will and that you are distributing your property according to your own intentions.

If you wish to make a will and you are under 18 years and have never been married, you can apply to the Supreme Court. If you are under 18 years and married, you can make a will. Also, if you are under 18 years and are about to be married, you can make a will in contemplation of that marriage. Your will becomes valid when that marriage takes place.

Formal Requirements For Making A Will

The key requirements for a valid will are:

• the will must be in writing;
• the will must be signed by the testator at the end of the will;
• the testator’s signature must be witnessed by two witnesses. (A beneficiary or their spouse cannot witness a will. If they do they will lose their entitlements under that will);
• the witnesses must sign the will in the presence of the testator and each other.

As the formal requirements for making a valid will must be strictly adhered to, it is recommend that you have your will drawn up professionally.

What Should Be In A Will?

The will should specify that it is your last will and that you revoke any previous wills. It should appoint one or more persons to be your executor/s. Wills often include other requests such as funeral arrangements, preferences for disposal of the testator’s body and the appointment of a guardian to look after the testator’s children. As wills are only meant to deal with property, wishes such as these are not strictly binding on the executor, but can demonstrate the testator’s intention. If a court is asked to determine the residency and guardianship of any children, the testator’s wishes will be taken into account.

Your will should provide for payment of funeral expenses and any debts. It should then state how you want your property distributed, either by naming the item and to whom it is given, or by giving a person a certain amount or percentage of the total value of your property. If your will contains specific gifts, it should also state what is to happen with the residue (remaining assets) of the estate.

Executors

An executor is a person named in your will to look after your estate. An executor must be over 18 years of age. It is easier, although not compulsory, if the executor lives in the same state as the testator. It is also preferable to name two executors in a will. This will be of assistance if one executor dies or no longer wishes to act as executor. When considering people to be your executors, it is preferable to choose someone close to you, trustworthy and of a similar age. These are simple safeguards against possible complications later. If no executor is named in your will, the Supreme Court will appoint an administrator.

Changing Or Updating A Will

Once a will has been signed, there can be no alteration, either by crossing out or writing in new clauses. Alterations such as these will have no effect. The best way to amend or alter a will is by doing so in a separate document called a “codicil”. For a codicil to be valid it must also meet the formal requirements of making a will. In many ways it may be easier to make an entirely new will.

How Marriage Or Divorce Affects Your Will

Your will is automatically revoked, or made invalid, when you get married and on the day you are formally divorced by a court. However, wills made in contemplation of marriage or divorce are valid. If you do not wish to make a will in this way, a new will must be made after you marry or divorce, otherwise you will die intestate.

Contesting A Will

A person may challenge your will on a variety of grounds including that you were not of sound mind, or were unduly influenced or pressured by another person when making your will. Wills can also be challenged if they do not meet the formal requirements for making a valid will.

Another reason for challenging your will is on the ground that you failed to make adequate provision for the proper maintenance and support of a dependant. If one of your dependants expected to be a beneficiary under your will and has been left out, they may be able to make a claim under the Testator’s Family Maintenance Act 1912. This is called a testator’s family maintenance claim (“TFM claim”). The following people are able to bring a TFM claim: your surviving spouse or de facto; your children (including ex-nuptial, adopted and stepchildren); your parents (if you die without a spouse or children); and a divorced spouse who is receiving or entitled to receive maintenance from you at the date of your death.

If you have been left out of a family member’s will and believe you should have received a share of their estate, you should seek legal advice. If you have any questions or would like to speak with one of our solicitors, please contact us.