If your loved one has passed and left behind few assets solely in their name, then you may not be required to go to court, regardless if the deceased had a will or not.
If the deceased had a will it names an ‘executor’; the person responsible for collecting in assets, discharging debt and releasing the assets of the deceased. If the deceased did not have a will, they are said to have died ‘intestate’. The role of managing the estate is much the same, but the person appointed by the court is called the ‘administrator’. They are the next closest next of kin, usually the spouse first, if no spouse then children or parents. The role is very much the same no matter if the estate is managed by an executor or administrator. The executor or administrator can be universally referred to as the ‘personal representative.’
Determine assets and liabilities
The personal representative is required to make an inventory of all the deceased’s assets and liabilities. This is critical to working out if they are required to go get a court order to manage the estate, called a ‘grant of representation’. (‘grant of probate’ for executors or ‘letters of administration’ for administrators).
Even if the deceased was wealthy, they may not have many assets solely in their own name. The following assets do not usually form part of the deceased estate;
- Joint bank accounts. The entire balance belongs to the survivor.
- Property held as ‘joint tenants. The title passes to the survivor.
- Life insurance policies. The policy is paid to the named beneficiary, such as a spouse or child. While possible, it is uncommon for life insurance policies to be paid to the estate.
- Superannuation. As with life insurance, the policy is paid to beneficiaries named in their binding nomination. If there is no binding nomination the trustee of the super fund will determine who the beneficiaries will be.
- Trusts and companies. These are independent entities. The deceased may have been a director, but the company may have had different shareholders. Check with the deceased’s accountant or lawyer for detail on ownership and succession.
Providing these assets are solely in the deceased’s personal name, these assets form will form part of the estate;
- Real estate, owned solely or as tenants in common.
- Bank balances.
- Shares.
- Personal property.
Contact each organisation holding an asset
A grant of representation can be either a grant of probate (issued if the deceased had a valid will) or letters of administration (issued when the deceased did not have a will). One of these grants is usually requested when an organisation holds an asset or maintains a register for an asset of the deceased.
Depending on value of each asset a grant may not be required. For example, if the deceased had a bank account with less than $15,000 a grant is generally not required. Assets can be released to the next of kin if presented with the death certificate, statutory declaration and, if available, the will. Don’t close the deceased’s bank account until all other tasks for the estate have been wound up.
You may find that a grant is not required to release any of the deceased’s assets to the next of kin, in which case you do not need to go to court.
Payments to the estate
Don’t close any of the deceased’s bank accounts until the estate administration has been fully completed. This is because you may get refunds such as;
- Refunds from health and other insurance policies
- Centrelink or DVA payments
- Refunds from cancelled registration
- Payments from other bank accounts or term deposits
As the family goes about closing accounts they may be issued with some refund cheques payable to ‘The estate of the late John Smith’. Generally, cheques payable to ‘the estate of…’ can only be banked into the deceased’s usual bank account if the bank has changed the status of the account to a deceased bank account. Check with the bank directly as to the requirements.
When you are required to obtain a grant
If you find assets won’t be released or cheques can’t be cashed into the deceased’s regular account you may have no other option that to obtain a grant from the Supreme Court. It’s worth doing a quick calculation on the cost of obtaining the grant. There is usually a filing fee, however it may be waived where the estate is worth less than $15,000.
It’s worth going ahead with the application for a grant when the cost to obtain the grant is less than the value of all assets received into the estate that require the grant.