CHIELDA. I'm Chelsea Daniels and this is the Front Page, a daily podcast presented by the New Zealand Herald. Losing a loved one is one of the worst things a family can go through, but it can get a lot worse if people start fighting over the will before the body's even cold. With so many of us relying on inheritance these days to get on the property ladder, being cut out of a will can be a devastating blow, but contesting it can sometimes be more trouble than it's worth.
So how should you go about getting your fair share and what can you do to make sure your final wishes are clearly communicated? Today on the Front Page ends at Herald, senior journalist Jane Fair joins us to share the dues and don't She's picked up from legal experts when it comes to inheritance. Jane, when we talk about laws and inheritance, how much of the decision making is in the hands of the person actually writing the will and how much is dictated by the law.
A bit of both, because the willmaker has specific wishes, but they have to do the will within the law. So only personal property can become part of the estate. So one way that people if they want to cut someone out of their will, perhaps a family member they've fallen out with, they can use a trust and that means that no one in the family can attack that trust if they're not a beneficiary. But that is something
that the Law Commission want changed. They had a big review that came up with one hundred and forty recommendations about the succession laws and inheritance, and they want the courts to have greater power to attack trusts.
You've recently spoken to a number of legal experts about the intricacies of writing and contesting wills. What are some of the most common familial battles that can emerge when it comes to this kind of thing.
I think it's the element of surprise.
The people I spoke to, the estate planners and the lawyers, they recommended that you are transparent about your will, that you discuss it with your family, your children, so they're all aware there are no naszi surprises, and you tell them the reasons why they might not like it, but they probably won't react quite as violently as if they didn't know what was coming. One of the things they also said that is, if you are going to cut a child out or someone who is expecting to inherit.
They didn't recommend that.
They morell As said, you have to show that you've discharged your moral duty, that you've thought about them. So a better way, they say, is to leave a normal amount. It might only be five thousand, or it depends on the size of the state, but you leave a nominal amount and also some documentation explaining why you haven't treated them equally, so that if it did go to the court, the court had an idea of what you're thinking was.
What are some of the worst will fights that you've heard about.
Some of them go on for years.
You have to go through the High Court and the High Court's backlogs, so you have to wait a long time. It can be incredibly expensive. Fifty one hundred thousand, but some of the lawyers I spoke to said way more than that, and it can go on for years because they just keep relitigating. And in the end, it's not
really about the money. It's about them being hurt. It's about old family rivalries, probably sibling stuff that goes back decades that comes out after mum and dad are dead, and if they're not going to inherit, then no one's going to inherit because the estate gets whittled down with legal costs the executives have to defend.
So you've spoken to the experts.
What are some tips to writing a will to ensure things don't go pear shaped after you die.
Making sure that the will is up to date, making sure that the family are treated equally.
That's the main thing.
And if you're not going to that, you leave clear reasons why you're not. You need to think about step children and if a step mother is left, whether your own children in other words, is step children of the stepmother. They might fall out with her and attack the will or vice versa. She might think that the children have had enough and they've been left too much and she hasn't been left. So it's all those sort of family dynamics.
And if you don't get it right and the family do fall out, it causes bitter family divisions that are never resolved.
And when it comes to making claims, who does and doesn't have the right to make one.
Interestingly, the Law Commission, one of their recommendations, which I think will be quite controversial, is that they've recommended one of the options is that children over the age of twenty five will not be able to contest their parents' will. The Ministry say that they are a long way from even looking at those recommendations, so it's not going to happen anytime soon, but that is something to keep in mind.
One of the options put forward by the Law Commission is that only children under twenty five can make a claim against their estate, and really it's taking into consideration the differences between the obligations of a parent to pass on an inheritance or look after their children versus actually the freedom of a person to make a choice about how they want their estate to ultimately be distributed.
So who does have the right to claim against a will are children and spouses and long term partners, and in some circumstances, step children if they've been supported by the willmaker during their lifetime, and even parents and grandparents who have been supported by the willmaker can make a claim.
Those who can't claim a sibling, so a brother or sister can't claim against each other's wills, and adopted children they can claim against the parents who brought them up, but they can't claim against biological parents' will, and in the case of fungi where Maori children have been adopted out to a family member. There's been a recent case in the High Court that failed, so fungi children can't claim against their biological parents.
Why isn't it as simple as this is what the deceased person wanted.
I think it's human nature that the children might behave when mum and dad are alive, they keep their the family bond in a way. But then all those rivalries, like mum always favored your dad always favored you. You've got a lot more help than me, you're more successful than me. I need the money more. All those sort of human dynamics come out, and you know where this money people behave really badly.
Does the fact that there's so much wealth in this country tied up in property complicate inheritance at all?
One of the interesting things that Patrick Gamble said, he's the CEO of Perpetual Guardian. He said that if estate planning is not done well and the will maker is not a clear will, he called it tumbling out of the middle class. So he was talking about the wealth of the baby boomers. A lot of the next generation and the generation after that are relying on that wealth.
To buy a home or pay off their mortgage, and if it goes wrong where they get cut out or the estate gets whittled away with everybody fighting over it. Suddenly you've got someone who was brought up, you know, in a reasonably wealthy family, expected to own a home, can't.
Society is always evolving and the way we live is always evolving, so you can, I'm sure understand that the number of blended families is much higher now than it was seventy years ago. There's also an emphasisthakonga maori now and other cultural norms and making sure they're covered in the legislation. And also we're facing the largest transfer of wealth we've ever seen in New Zealand history, so the baby wom is over the next fifteen to twenty years
we'll leave around about a trillion dollars in assets. So you need to make sure that inheritance law is very tight, make sure we get it right.
What's the best advice for how to contest? Still will? I've thankfully not how to do that yet, hopefully never will. My brother and I usually get along, but how would I go about it if I did have to?
You have to contest within a year of probate.
So probate is where the will is more or less made an official document by the High Court, so you got twelve months, but they recommend it contesting it as soon as possible, because the executives can actually disperse the assets within six months of probate, so if there's nothing left to disperse, there's nothing left to fight about it.
So the sooner the better.
Lawyers more or less say don't go to court if you can, and most are settled out of court because everybody understands how much it's going to cost, so.
Mediation is a possibility.
The issue with mediation is it's not legally binding, so if they change their mind, it could still end up in court. And the other, I think better way is a deed of family arrangement, and that's where the executives and the family members and everybody is fighting actually come to an agreement to alter the terms of the will so that they say, yeah, fair enough, we'll give you ten grand to go away or whatever.
You've mentioned. The one hundred and forty recommendations that have been made by the Law Commission to tidy up these rules, how many of those have it been actually taken up and put into law or is it quite a process?
No, none of them and it will be years. The only one, the only recommendation, it was actually one hundred and thirty nine out of one hundred and forty is the limit when someone dies and the estate is worth fifteen thousand or less, you don't need to go for probate and go through all the drama. You can just if you're a family member disperse that The Commission have recommended that that amount, I mean.
It's ridiculously low.
It was set in two thousand and nine, so they recommended that that amount be brought up to twenty twenty four level, or that it is adjusted to inflation from then on. That's the only recommendation that there's even been looked at. The issue is that the Commission also looked at the property relationship issue as well, and the government wants to look at both those together. It's a huge
body of work. It will need consultation. You've got quite contentious issues like children under the adju of twenty five can't inherit, which are going to divide the community. So I think it's probably not in this decade.
I guess if you're thinking about creating a will and doing something before you die and to make sure that your wishes.
Are held up.
Are there any other ways other than a will where you can make sure that your family members get what you want.
The other way is to gift assets and money in your lifetime, and as a result, there's nothing really left or very little left to fight over in the estate. The only way that anyone could contest that was if they felt you'd done that under duress or that you went mentally capable. That those sorts of reasons they could contest. But other than that, you're free to give you two sons and a daughter assets and leave another one out.
More than a third of older kiwis are not waiting until they die to transfer their wealth to loved ones. According to New Zealand's Seniors Report, fifty seven percent of those surveyed so they're worried about what they'll leave behind to their kids because of current economic challenges. Ninety one percent thought home ownership in particular is becoming increasingly difficult, especially for those whose parents can't help them out.
I guess it's an incredibly interesting but also sad topic, isn't it, Because we're essentially talking about someone having wishes and doing a will and then once they pass it could break up entire families. Have you seen in your research in your writing, is it generally quite upsetting?
It is.
I've written about this before. I've written about puritance, and I've also written about how you pass the family batch and holiday home on to your children without them all fighting,
and also the family farm. And every time I write those stories, I get emails and from people with quite sad stories that date back years, some of them, some of them back to the seventies, and they've never quite got over the fact that they fell out with their brother, or their sister was given more than they did, or a stepmother ended up with everything and she'd only been with a husband for five years and they lost all
their mothers. China, all those sort of emotional stories has plenty of them around, And I know in my own life, I know some of my family friends who don't speak to each other as a result of falling out over the will, and so their children, the cousins grow up not knowing each other. Whereas when my parents died, my mother died first, but when my father died, he left really clear instructions. He talked to the three of us
individually and together. We had a family lawyer involved, and it was all done amicably and we're all was a great experience.
Really.
I know that my papa back in Adelaide has given us post it notes before he passes, and where to put colored post it notes on things around the house that we want, So it can actually be quite a nice experience, you know, remembering that Papa wanted me to have the brown chest to Field that I've always loved. You know, it's quite somber, isn't it. But also it can be translated into a quite nice experience.
Well, yes, unless somebody swaps the post it notes or accidentally on purpose drops off.
Unless my brother wants that chest to field after Papa goes, and someone and one of the family says, but she promised those pills to me as well.
So yeah, it's better to write it down.
I have to remember that next time I go home. Finally, Jane, reading a piece, it does seem that the overall advice is that contesting a will might cost more than it's worth, hey, and do more harm than good.
I guess.
So from the experts you've spoken to, what's the overall advice, Is it really worth kicking up that much for fast?
Well, I guess the lawyers want you to because they're charging the fees hit they get paid. They're the only ones that get paid. And it isn't cheap. I mean, it is fifty to one hundred thousand. If there's only two hundred thousand to fight over, the estate has to pay similar legal fees on the other side, so they're paying fifty to one hundred thousand or more, so there's not much left to fight over, depending on how many beneficiaries there are.
Thanks for joining us, Jane.
That said for this episode of the Front Page. You can read more about today's stories and extensive news coverage at enzed Herald dot co dot nz. The Front Page is produced by Ethan Siles with sound engineer Paddy Fox. I'm Chelsea Daniels. Subscribe to The Front Page on iHeartRadio or wherever you get your podcasts, and tune in tomorrow for another look behind the headlines.