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NSW Can Executor of a Will Distribute House Directly to My Son?

Discussion in 'Wills and Estate Planning Law Forum' started by onyx, 2 November 2015.

  1. onyx

    onyx Well-Known Member

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    Instead of inheriting a house and then transferring it to my son where he would need to pay stamp duty, can I tell the executor of a will to distribute the house directly to my son so that no stamp duty is payable?

    Thanks
     
  2. James D. Ford - Solicitor

    James D. Ford - Solicitor Well-Known Member

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    Hi Onyx

    The Executor has a duty to implement the intention of the deceased (Will maker) according to the terms of the Will... that does not mean that the distribution cannot be changed.. for example, where there is a threat of a FPA - Family Provision Application, all the Beneficiaries may agree (for example, via a Deed of Family Arrangement) to change the $$$ amounts amongst the Beneficiaries to avoid litigation against the Estate.

    "If the Executors and beneficiaries agree to distribute more of the Will maker’s chattels to one beneficiary than the others (agains the provisions of the Will), they may do so, provided the chattels in question have not been specifically gifted to a beneficiary in the Will."

    In your case, the above does not apply, as the Property has been specifically gifted to you.

    You need to be aware that..."the wording of the Will is very important in this situation as the Office of State Revenue will look to the Will to ensure that the change in the beneficiary’s distribution is still upholding the Will maker’s testamentary intentions."

    As a beneficiary you could reject your gift/bequest... however you MUST do so in a timely fashion... by clearly and absolutely informing the Executor in writing (and potentially the Court) of your wish to reject the gift/bequest. If you did this, who would then obtain the benefit of the Property under the Will as it stands?

    Kind regards
     
    onyx likes this.
  3. onyx

    onyx Well-Known Member

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    Hi James, I hope you don't mind me asking in this forum - we'd slightly covered it before in the property law forum but as you mentioned it wasn't your area of expertise, I thought I'd ask in the proper forum.

    I am a residual beneficiary with no assets specifically gifted to me. The other beneficiaries were gifted small amounts of cash, but easily catered for by the rest of the estate.

    The deceased had no spouse (or ever did), no children or no step-children nor any siblings. His parents, grandparents, uncles and aunts are deceased. He only has cousins, nieces and nephews alive. My son who I'd like to gift the house was his nephew which looking at the Succession Act seems to hold no importance.

    My son was mentioned in the deceased's Will with my other (now deceased) son as the residual beneficiaries should I not out-survive the deceased however - so maybe that could indicate an intention?

    To my knowledge, probate is being applied for tomorrow.
     
  4. James D. Ford - Solicitor

    James D. Ford - Solicitor Well-Known Member

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    Hi Onyx

    The area I was referring to that was not my direct area (though I do have a lot of general knowledge in the area - is Family Law).

    I am confused, as you mentioned you have inherited the Property, and then you say you have not been gifted any specific assets?

    Which is it? If you are a residual beneficiary, and no-one was left the Property..... the Property will be sold by the Executor and the proceeds from the sale will form part of the residual estate.

    I will need to read the Will to look at the exact wording... regarding your son taking your share.. of the residual estate, to see if it could operate if you disclaim your share...

    Kind regards
     
  5. onyx

    onyx Well-Known Member

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    Hi James,

    I couldn't locate a private message or an email address for you on here or your company's site to send you the Will, but I'm thinking it will be too late and probably too messy anyway. I think the executor & the solicitor he employed would freak at a last minute spanner, considering probate is being applied for today and the complexity of the case.

    When I say messy, the house wasn't specifically mentioned in the deceased's Will. In fact the deceased never owned the house while he was alive. His father left it to him in his Will, a step-daughter contested and he was left the residue of the estate which included the house. He died about 15 months after his father but before distribution of the father's estate. The executor of the son's Will isn't liquidating the house - in fact the executors of each Will are trying to get the house transferred directly to me rather than to the son's estate, then me.

    The property doesn't need to be sold to satisfy any specific gifts of the Will - are you saying property must be sold if it is not specifically gifted?
     
  6. James D. Ford - Solicitor

    James D. Ford - Solicitor Well-Known Member

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    Hi Onyx

    Everything depends on the wording of the Will... normally Property needs to be sold in order for the creditors, funeral expenses, debt and taxes to be paid, and so the Beneficiaries can share in the residual estate in the percentages % nominated in the Will.

    It is also possible the Will might state the following:

    "I direct that the net proceeds of sale of my remaining estate be added to my residuary estate..."

    However, based on what you have indicated.. the Wills appear to allow discretion on the part of the Executors... and there appears to be enough cash, liquid assets to be able to take care of these matters... and not need to sell the Property.

    Kind regards
     

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