Over My Dead Body

What are the odds my will gets challenged?

My dad's making a big deal now that he's done his will, telling us kids that we had better accept what we're given (though giving zero details about the actual split).

Why? 

Cue his cautionary tales about descendants feuding over chunky estates until nothing is left once client-baiting lawyers are paid. (Dude, lawyer here. I'm still in the room.) 

Wills in Australia most often get challenged by children who think their parents should have given them more. But that may be because 'family provision' laws, which vary state-to-state, have strict eligibility criteria. Otherwise, every man and his dog might have a crack.

I often think, who's more to blame? Greedy - often greying - heirs, or testators maintaining tyranny beyond the grave?

And is the risk as big as he clearly thinks it is?

To answer the question, let's start with this study: White, Tilse et al, "Estate Contestation in Australia".

In 2011 there were 215 judicially determined contests about estate distribution in Australia.

Yes, but what about the cases resolved before trial?

The study says little about out-of-court settlements apart from that mediation in NSW has had little effect.

So how many civil law cases in general don't make it to trial? 80% at the Federal Court in 2020-2021. It's a bit of a stretch because of the gaps in jurisdiction and time, but that number doesn't fluctuate much, and drilling down to small-pool family property matters gives a rate of 75%. So I think we can fit that federal 80% to probate. 

If 215 represents 20% then 100% is 1075 wills challenged a year.

Now for the denominator. How many estates get administered a year?

In 2016 there were 129,693 deaths of Australians over 65. Younger people get excluded because let's face it, they likely won't have accumulated an amount worth fighting over.

Even though 45% die intestate, estates without a will still attract family provision actions.

1075 ÷ 129,693 = 0.008

Bottom line: > 1% are the rough odds my dad's estate gets challenged. If it does, there's a 60% chance it's by one of us spoiled kids, and a 20% chance it runs as far as a judge.

Small odds are still odds though, and if this happened to you (as a beneficiary or executor of course, not as the deceased) then you have my condolences. So what might one do to reduce the already minor risk?

You could do as my dad did and warn your kids to suck it up and be grateful.

You could also try not to be a jerk. At least, not when drafting the will.

To be fair, people's circumstances may change greatly in the years between when a will is drafted and when it's executed, and it's hard to tell what will be a fair distribution so far in advance.

So maybe the final lesson could come from my Mum rather than my Dad.

She and her siblings received unequal shares from an estate. No malice involved, just that the testator decided that some heirs needed more than others. At least, at point of drafting.

By the time the will was read, some of the needy and some of the monied had switched places. What happened was surprising.

Surprise #1: they negotiated transfers to take place after the estate was distributed. Debate wasn't entirely smooth, but they focussed on points of agreement - that transfers needed to happen - and leveraged that consensus to converge on how much to transfer.

Surprise #2: The transfers happened.

I don't know why my dad didn't discuss the possibility that his estate could be up for re-distribution, not by intrusive laws hell-bent on stripping testators of autonomy, but by inheritors willingly making up for out-of-date allocations.

Whether or not he modifies his adversarial outlook doesn't really matter. Sadly, he logically cannot be involved in administering his estate.

It will be up to his adult children to negotiate side payments, hopefully more as adults than as children.