A will is one of the most important documents most Victorians will ever sign. Done well, it makes life significantly easier for the people you leave behind. Done poorly — or not at all — it can create years of expense, delay and family conflict.
In Victoria, wills are governed by the Wills Act 1997 (Vic). This guide explains what makes a will valid, the choices you need to make, and the practical steps of getting it right. For advice on your own circumstances, see our Wills & Estate Planning practice-area page.
Testamentary capacity
To make a valid will, you must have testamentary capacity. Broadly, the will-maker must:
- understand the nature and effect of a will;
- understand, in general terms, the extent of their assets;
- be aware of the people who might reasonably expect to benefit;
- not be affected by a disorder of the mind that distorts their judgment.
Capacity is decision-specific. A person may lack capacity to run their affairs generally but still have capacity to make a simple will. Where capacity may be in doubt, a contemporaneous medical opinion should be obtained. The Supreme Court can also make a court-authorised will for a person without capacity in appropriate cases.
Written form and formalities
Under section 7 of the Wills Act 1997 (Vic), a will must be:
- in writing;
- signed by the will-maker (or by someone else in their presence and at their direction);
- with the intention that the signature give effect to the will; and
- witnessed by two adult witnesses who are present at the same time and who each sign in the presence of the will-maker.
The witnesses do not need to read the will. They should not be beneficiaries under the will, or the spouse of a beneficiary — a gift to a witness (or their spouse) can be forfeited unless one of the statutory exceptions applies.
The Supreme Court can, in some cases, dispense with the formal requirements and admit an informal document as a will (section 9). Reliance on that jurisdiction is expensive, slow and uncertain — it is far better to get the formalities right the first time.
Choosing an executor
The executor administers your estate. Choose someone who is:
- trustworthy and organised;
- likely to outlive you (or, if a business, likely to still exist);
- willing to act — no-one can be compelled to accept the role;
- ideally, based in Australia.
Appointing two executors can share the load but can also produce deadlock. It is prudent to name a substitute in case your first choice cannot act.
Gifts and beneficiaries
A well-drafted will deals clearly with:
- specific gifts (for example, a piece of jewellery, or a nominated sum);
- the residuary estate (everything left after specific gifts and expenses);
- alternative beneficiaries if a primary beneficiary predeceases you;
- whether gifts to children include grandchildren by representation;
- how debts and taxes are borne by the estate.
Remember that superannuation and jointly owned property do not automatically pass under your will. Superannuation death benefits usually pass under a binding nomination or by trustee decision, and jointly held property passes to the surviving joint tenant.
Guardianship of children
If you have minor children, your will can nominate a guardian to care for them if both parents die. The Family Law Act and other legislation may affect who ultimately has parental responsibility, but a testamentary guardianship clause carries real weight, particularly where it reflects a considered decision made with the other parent.
Testamentary trusts
A testamentary trust is a trust created by your will that comes into existence on your death. Advantages can include:
- flexibility in how income is distributed among beneficiaries;
- potential income tax advantages, particularly for minor beneficiaries;
- some asset protection where a beneficiary is at risk of bankruptcy or family law claims.
Testamentary trusts are not appropriate for every estate; they add complexity and administration cost. Advice should be tailored to the size and nature of the estate and the circumstances of the beneficiaries.
Blended families
Blended families require particular thought. Common structures include:
- life interests giving a surviving spouse the right to occupy the home during their lifetime;
- mutual wills entered into with a partner;
- testamentary trusts for children of an earlier relationship.
Blended-family arrangements can also increase the risk of a Part IV (family provision) claim after death. Documenting your reasons — and, if appropriate, obtaining evidence of your circumstances at the time — can help.
Storage and access
Your original will should be stored safely. Most law firms hold original wills in a fire- resistant safe at no charge. Tell your executor where the original is held. Do not staple or unstaple your will after it has been signed — even removing a staple can raise probate requisitions about missing pages.
When to review your will
Consider reviewing your will after:
- marriage (which generally revokes an earlier will) or entering a de facto relationship;
- separation or divorce (which affects gifts to a former spouse);
- the birth or adoption of a child or grandchild;
- the death of a beneficiary or executor;
- buying or selling a home or business;
- significant changes in assets, including inheritances or superannuation.
The risks of informal or DIY wills
Common problems with kit and DIY wills include:
- defective signing and witnessing;
- ambiguous descriptions of gifts or beneficiaries;
- failure to deal with the residuary estate;
- attempted disposition of superannuation or jointly held assets that pass outside the will;
- no consideration of Part IV risk or blended-family issues.
The cost of correcting problems after death — sometimes through contested Supreme Court proceedings — routinely dwarfs the cost of properly drawing the will in the first place.
Holt & Macdonald prepares wills, powers of attorney and estate plans for clients across Ringwood, Maroondah and Melbourne’s eastern suburbs. If you would like to review your current arrangements, our Wills & Estate Planning page explains how we can help.
