Succession Laws: Report

1. Introduction

Terms of reference

1.1 On 1 March 2012, the Attorney-General asked the Victorian Law Reform Commission to report on a number of succession law matters by 1 September 2013. The terms of reference are on page x.

1.2 Succession laws regulate how property is administered and distributed on the owner’s death. Most of Victoria’s succession laws are found in:

• the Wills Act 1997 (Vic) and associated case law on the construction and validity of wills

• the Administration and Probate Act 1958 (Vic) and associated case law dealing with the administration and distribution of assets.

1.3 The Wills Act is the product of extensive and detailed reviews in Victoria over a period of 10 years, first by a government working party^[1] and later by the Victorian Parliament Law Reform Committee.^[2] The Commission was asked to report on only three issues concerning wills:

• witnessing wills and undue influence

• statutory wills

• ademption.

1.4 Unlike the Wills Act, the Administration and Probate Act has never been comprehensively reviewed. While not requiring the whole Act to be examined, the Commission’s terms of reference extend to many of the key provisions, including those that address the following issues:

• executor’s commission for their time and trouble

• applying assets to the payment of debts

• the intestacy scheme for distributing the assets of someone who has died without making a will

• special procedures for administering small estates

• family provision.

The National Uniform Succession Laws project

1.5 In conducting the review, the Commission is required by the terms of reference to take account of recommendations made by the National Committee for Uniform Succession Laws. The National Committee guided the National Uniform Succession Laws project, which was an initiative of the former Standing Committee of Attorneys-General (SCAG).^[3] The aim of the project was to develop uniform succession law and practice across Australia.

1.6 The National Committee conducted extensive research in conjunction with a number of law reform bodies over a period of 14 years and published reports on the law of wills (1997), family provision (1997 and 2004), intestacy (2007) and the administration of deceased estates (2009).

The Commission’s process

1.7 The Commission’s review was led by Dr Ian Hardingham QC and guided by a Division chaired by the Hon. Philip Cummins. The other Division members were the Hon. David Jones AM and Eamonn Moran PSM QC.

1.8 Shortly after Dr Hardingham’s appointment, the Commission formed an advisory committee of experts to provide insights into how the law works in practice and discuss issues and options for reform. The members were asked to bring their expertise to the issues discussed and not necessarily represent the views of any organisation with which they work or are affiliated. The advisory committee met four times and its members are listed at Appendix A.

1.9 When conducting a review, the Commission usually publishes a consultation paper addressing all of the issues arising from the terms of reference and seeking written submissions on possible reforms. Because the terms of reference in this case covered a range of disparate subjects, the Commission instead released six short consultation papers. Each focussed on one or more key topics as follows:

• Wills—whether there is a need to revise the law on witnessing wills to better protect elderly and vulnerable will-makers from undue influence; statutory wills; and ademption.

• Family provision—whether the law is achieving its objective of ensuring that provision is made for people for whom the deceased person had a responsibility to provide.

• Intestacy—whether the law is operating effectively to achieve just and equitable outcomes.

• Executors—whether there should be special rules for legal practitioner executors and whether a court should be able to review executors’ costs and commissions.

• Debts—whether the law governing how a deceased estate’s assets are ordered to pay its debts can be simplified.

• Small estates—whether there are more efficient ways of dealing with small estates.

1.10 Submissions were invited by 28 March 2013, though the Commission accepted contributions after that date. Most of the submissions are public and can be seen on the Commission’s website.^[4] They are listed at Appendix B.

1.11 Throughout the reference, and particularly after the consultation papers were released, the Commission consulted widely. Meetings with legal practitioners were held in Colac, Shepparton and Wodonga as well as in Melbourne. An open day was held to provide an opportunity for members of the public to meet with Commission staff to discuss their response to the questions raised in the consultation papers. The Commission held a roundtable on wills, which was attended by representatives of community groups, legal practitioners, academics, State Trustees and the Victorian Civil and Administrative Tribunal. Meetings were held with members of the Law Institute of Victoria, judges and associate judges of the Supreme Court, judges of the County Court, and representatives of private trustee companies.

1.12 As a number of the law reform options being considered by the Commission drew on New South Wales legislation and practice, Dr Hardingham held discussions in Sydney with members and staff of the New South Wales Supreme Court and other individuals and organisations with expertise in this area of the law. The consultations held after the consultation papers were released are listed at Appendix C.

1.13 In addition to the planned consultations, the Commission received many comments and further information informally from interested members of the public as well as from individuals with specialist knowledge and expertise.

The Commission’s approach to the issues

1.14 In considering the issues arising from the terms of reference the Commission was mindful of the stated objectives of the review. It noted in particular that state and territory ministers have agreed to adopt the National Committee’s recommendations as the basis for reforming succession laws, with the aim of maximising national consistency.

1.15 The Commission’s guiding principle was that national consistency is to be preferred where Victorian law or processes are not demonstrably fairer or more efficient. However, national consistency is not always advanced by adopting the recommendations of the National Committee for Uniform Succession Laws. For example, Victoria’s family provision law already largely aligns with the National Committee’s proposed model legislation but no other states or territories have adopted it.

1.16 Other features of the National Committee’s proposed model legislation are not controversial and the Commission has found no policy reason to depart from them. For example, the Commission’s recommendations for reform of the intestacy scheme follow the model closely.

Structure of this report

1.17 The structure of this report broadly follows the terms of reference. The first three topics in the terms of reference concern wills, and they are discussed in Chapters 2–4.

1.18 The focus of the report then turns to two schemes established by the Administration and Probate Act that affect how the assets of a person are distributed after they die. Chapter 5 concerns the distribution of assets on intestacy, when a person dies without making a valid will or their will does not dispose of all of their property. Chapter 6 reviews the family provision law under which someone for whom the deceased person had a responsibility to provide, but who was not adequately provided for, may apply to have the assets redistributed in their favour.

1.19 Chapter 7 discusses two of the topics in the terms of reference together because they both concern executors: whether there should be special rules for legal practitioner executors, and whether a court should have the power to review and vary costs and commission that executors charge.

1.20 In Chapter 8, the question of how assets are designated to pay the debts of an estate is explored. Chapter 9 considers the way in which Victorian law and practice assists in the administration of small estates. Chapter 10 sets out in general terms the costs rules and principles that are applied in succession proceedings. The costs rules that apply when the court authorises statutory wills, and in family provision proceedings, are discussed in Chapters 3 and 6 respectively.

1. In 1984, the Attorney-General established a working party to review the Wills Act 1958 (Vic). It comprised representatives of the Law Department, the Probate Office, the Law Faculty of the University of Melbourne, the Law Institute of Victoria and the Victorian Bar. Its report was presented to the Attorney-General in 1986 but not published. Work then began on drafting a Wills Act. The eighth draft was referred to the Parliamentary Law Reform Committee in 1991.

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2. Law Reform Committee, Parliament of Victoria, Reforming the Law of Wills (1994).

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3. Now known, since September 2011, as the Standing Council on Law and Justice. It comprises Commonwealth, State and Territory Attorneys-General and the New Zealand Minister for Justice.

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4. Victorian Law Reform Commission, Succession Laws (15 July 2013) <https://www.lawreform.vic.gov.au/inquiries/succession-laws>.

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