Sarah-Bull
By Sarah Bull

Dying without a will is called dying intestate. This means that when you die, your property and possessions are distributed in accordance with the Administration Act.

In New Zealand, when someone dies intestate the Administration Act 1969 (the Act) determines the following matters:

  1. Who will be the administrator of the Estate;
  2. Who will benefit from the Estate; and
  3. What proportion each class of beneficiary will benefit.

Section 77 of the Act is sets out the rules for who will benefit and in what proportion in the following priority:

Has Partner; No Children or Parents

Husband, wife, civil union partner or de facto partner but no children and no parents – Personal chattels and residue to husband, wife, civil union partner or de facto partner.

Husband, wife, civil union partner or de facto partner and children – Personal chattels husband, wife, civil union partner or de facto partner and residue 1/3 to Husband, wife, civil union partner or de facto partner and 2/3 to children;

Husband, wife, civil union partner or de facto partner, no children but one or both parents – Personal chattels husband, wife, civil union partner or de facto partner and residue and residue 2/3 to husband, wife, civil union partner or de facto partner and 1/3 to parent or parents equally;

No husband, wife, civil union partner or de facto partner but child or children – entire estate to child or children equally;

No husband, wife, civil union partner or de facto partner, no children, no parents but one or more siblings (full or half blood) – entire estate to sibling or siblings equally;

No husband, wife, civil union partner or de facto partner, no children, no parents, no siblings but 1 or both paternal or maternal grandparents or paternal or maternal aunts or uncles (half or full blood) – ½ of estate to maternal grandparents or grandparent but if none then maternal aunts or uncles (if any) and ½ of estate to paternal grandparents or grandparent but if none then paternal aunts or uncles (if any). If either maternal or paternal fail then all of the estate will go to the other;

The entire estate will go to the crown who may provide for dependants of the deceased and other persons for whom the deceased might reasonably have been expected to make provision.

This priority table is also relevant when appointing an Administrator of the Estate. Much like an Executor being responsible for administering the estate in accordance with the deceased’s will, an Administrator is responsible for ensuring the deceased’s estate is administered in accordance with the Act.

Looking at this table in section 77 of the Act, it is obvious how the Administration Act as a default might be problematic, so the obvious solution is to make a will.

Does having a will safeguard you from issues of intestacy?

Do not be fooled! Having a will does not necessarily mean you will not have to be subject to the provisions of the Act. If a will has not been drafted with succession in mind, in a way that contemplates beneficiaries or executors predeceasing the will-maker, a situation known as a partial intestacy may arise. A partial intestacy may also arise where a will has not been drafted prudently (e.g. there has been no provision made for the residue). The relevant part of the Act will then come into play.

Where the assets of an estate exceed $15,000.00 an Administrator must apply to the High Court for a grant of letters of administration (with the will annexed if it is a partial intestacy) which enables them to administer the estate. Like obtaining a grant of probate where a valid will exists, this task is most commonly delegated to lawyers to complete on the Administrator’s behalf due to the strict requirements of the Court. If the documents are not drafted correctly they will be rejected by the Court which will delay the process.

Not having a will can have real-world implications for family left behind

For a recent example, check out this article published on NZHerald.co.nz, where survived siblings disagreed about the use of their parent’s money after they’d passed. On one side, one sister said that her parents had left her all of their money for personal use, saying that she had “done all the work” when caring for them. On the other side, two siblings were of the belief that their parents’ money was meant to be allocated to the parents’ funeral costs, totaling almost $12,000. Only one side won in court. But when siblings fall out over inheritance, are there really any winners?

Takeaway points on wills and intestacy

  1. Make a will with a reputable and experienced law firm who can advise you thoroughly; and
  2. Update your will regularly, particularly when a life event occurs (death of a loved one, marriage, children, separation).

Contact our wills specialists for thorough advice, wills preparation and will updates. We’ll listen and understand your personal situation, and help you prepare for the future.