Since July 1998, Part IV of the Administration & Probate Act 1958 (Vic) (APA) has governed the process for a person wishing to issue a "Testator's Family Maintenance" claim (TFM), seeking provision (or further provision) from a deceased Estate in Victoria. However, this process is shortly set to change, as a result of the Justice Legislation Amendment (Succession and Surrogacy) Act (new Act) which was proclaimed on 29 October 2014.
The new Act, which will come into operation on 1 January 2015, makes the following significant amendments with respect to those people who are eligible to make a TFM claim as well as to the factors that will now be considered by the Court in determining the outcome of a TFM claim.
1. Eligibility to bring a TFM claim
Currently, section 91 of the APA broadly provides that any person may apply to the Court for provision (or further provision) out of an Estate, if he or she can show that the deceased person had a responsibility to provide for their proper maintenance and support. This aspect of the current law has been met with criticism from the legal profession and community alike since its inception in 1998. The concern has largely been based on the fact that, at present, there is no fixed category of people eligible to make a TFM claim, thereby increasing the potential for frivolous TFM cases to be brought before the Court, which do not accord with current community standards.
The new Act goes some way in addressing this concern, by specifying that only the following claimants are eligible to bring a TFM claim:
- a spouse or domestic partner of the deceased at the time of the deceased's death;
- a child or stepchild of the deceased;
- a child of the deceased (including an adopted or stepchild) who, at the time of the deceased's death, was under the age of 18 years, a full-time student aged between 18 and 25 years or under a disability;
- a person who, for a substantial period during the deceased's life, believed that the deceased was his or her parent and was treated by the deceased as his or her natural child;
- a former spouse or domestic partner of the deceased (if a property settlement was not reached with the deceased following their separation);
- a registered caring partner of the deceased;
- a grandchild of the deceased;
- a spouse or domestic partner of a child of the deceased (if the child dies within one year of the deceased's death); and
- a member of the household of which the deceased was (or had been in the past and would have likely been in the near future) also a member.
2. Factors to be considered by the Court
The current provisions of the APA refer to the Court's requirement to consider a number of factors (contained in section 91(4) of the APA) in order to determine whether or not the deceased had a "responsibility" to provide for the claimant. These factors are also contained in the new Act. However, the Court is no longer obliged to give consideration to these factors. The new Act also specifies an additional factor which may be considered by the Court in assessing the merit of a TFM claim; that is, the effect that a Court Order would have on the amounts which are to be received by other beneficiaries of the Estate.
The new Act also differs from the current provisions of the APA by requiring the claimant to prove that the deceased had a "moral duty" to make adequate provision for their proper maintenance and support. In determining whether or not such a "moral duty" exists, the new Act provides that the Court must have regard to the terms of the deceased's Will, any evidence of the reasons for a testator making the dispositions in their Will and any other evidence of the deceased's intentions in relation to providing (or not providing) for the claimant.
Importantly, the new Act also seeks to limit the number of TFM claims bought by some of the eligible claimants, by including additional factors for the Court to consider. In particular, in the case of a claimant who was treated as a natural child of the deceased or a child or step-child of the deceased (who is not a minor, full-time student under 25 or who has a disability), the Court must take into account the degree to which the claimant is unable to provide adequately for their own proper maintenance and support.
In addition, for a registered caring partner, grandchild, spouse or domestic partner of a child of the deceased (if the child dies within one year of the deceased's death) and a member of the deceased's household, the Court must consider the degree to which they were wholly or partly dependent on the deceased for their maintenance and support, at the time of the deceased's death.
3. Which TFM Claims are affected?
The new Act will only apply in respect of TFM claims where the deceased died on or after 1 January 2015. However, given that the landscape of TFM claims is set to change significantly within the next two months by virtue of the new Act, it is important that Executors/Administrators and potential TFM claimants are aware of the manner in which future TFM claims will be determined by the Court.