So what actually is Probate?
WHAT IS PROBATE?
Probate is the process of proving that a document is a deceased person’s last Will.
The named executor is responsible for obtaining Probate (if it is required) and in administering the deceased person’s estate as required by the Will. If the named executor is unwilling or unable to so act, the alternate executor (if any) can do this. If there is no alternate, other persons can apply to the Supreme Court of New South Wales to administer the estate.
An application for Probate ought generally to be made with the Supreme Court within 6 months of the date of a person’s death. If more than 6 months has elapsed, the Court may require evidence in the form of an affidavit explaining the reasons for the delay.
Many entities that record asset ownership (such as the Department of Lands, banks, aged care facilities and share registries) will not release or transfer the assets of a deceased estate until Probate is obtained. If real property (land) is involved, a Grant of Probate will be required.
HOW DO YOU APPLY FOR PROBATE?
Probate is obtained by making an application to the Supreme Court. Documents including a Summons, Inventory and Affidavit or Executor are filed and various notices are published. Most people use a lawyer to do this for them.
If the executor’s application for probate is approved or granted, the executor is given a sealed document called a “Grant of Probate”.
If a deceased person does not have a Will, their estate is not administered after obtaining a Grant of Probate however, a similar document called “Letters of Administration” can be obtained by family members, such as a surviving spouse or children. The estate is then distributed as governed by the laws of intestacy – a statutory formula for how a person’s estate is divided if they don’t have a valid Will.
IS PROBATE NECESSARY FOR JOINT ASSETS?
If the deceased person owned assets jointly with other people (such as a spouse), probate is not required to deal with those particular assets because, at law, those assets pass to the surviving joint owner immediately on the other joint owner’s death.
Where a deceased estate comprises only of a few assets of small value, it is common for banks and the like to dispense with the requirement to obtain a grant of probate provided that the executor provides an indemnity for any claim made by others for wrongly releasing the asset.
WHAT HAPPENS AFTER PROBATE?
After a Grant of Probate is obtained, the executor can get in all of the deceased’s assets, pay any estate liabilities and distribute the estate as required by the Will, subject to there being no unsatisfied claims by creditors or family members such as those under theSuccession Act 2006. Often distribution takes place around 12 months after death.
WHAT DOES IT COST?
There are 2 aspects of dealing with an estate and the costs for each part are charged separately: the first part is the cost of obtaining Probate or Letters of Administration; the second party is actually administering the estate as required by the Will.
The cost of applying for probate is determined and fixed according to a scale set out in Schedule 3 to the Legal Profession Uniform Law Application Regulation 2015, with the cost being calculated by applying the statutory formula to the total value of the estate.
The costs of administering the estate after probate (selling or transferring the assets) are not capped, are usually charged at hourly rates and an estimate of costs should be provided.
Craig Pryor is principal solicitor at McKillop Legal. For further information in relation to probate, estate planning or business succession, contact Craig Pryor on (02) 9521 2455 or email email@example.com.