Estate planning in blended families

Anyone in a blended family situation should be aware of what their obligations might be to those left behind.

not have enough cash to buy out the other’s share of the home.

The surviving partner may need to bring a claim under estate or relationship property laws, if they qualify, to be able to get enough assets to stay in their home.

A recent High Court case considered a situation where the deceased’s husband and his surviving wife had been happily married for 18 years, each having children from previous marriages.

About 7 years before the husband died, the couple entered into a formal Relationship Property Agreement and executed new Wills.

The intention of the Agreement and the new Wills was that the surviving spouse would have as much financial security as possible.

The couple intended to leave their respective assets to each other in the event of death, with the survivor’s assets to then be divided equally between all of their children.

In effect, the Relationship Property Agreement meant that there was very little in the deceased husband’s estate for his surviving children to make a claim in respect of – the children would have to wait until the surviving wife died to be provided for.

The four adult children of the deceased, being unhappy with that outcome, applied to the court to be appointed a personal representative of their father so that they could apply to challenge the Relationship Property Agreement and have it set aside.

The High Court declined that application.

As a result the deceased husband’s intentions, and those of his surviving wife, were followed – this was possible due to their careful and purposeful estate planning.

While the couple in that case were able to affect their intention, there are many cases in which couples have either not turned their minds to these matters or received inadequate advice such that their intentions are not upheld following the death of one or both parties.

Anyone in a blended family situation should be aware of what their obligations might be to those left behind, including their surviving partner and children.

They should also give careful consideration, with the benefit of expert legal advice, as to how they would like their assets to be distributed in the event of death.

Sorting out the estate can be a very difficult time for the grieving family. Having taken care of matters with careful estate planning can make that difficult time a little less stressful and can also mean your wishes are carried out.