It is not uncommon that beneficiaries wish to change the distribution of a deceased estate.
Where all beneficiaries agree, a Deed of Family Arrangement may be used to affect the financial consequences of a Will or the Administration Act 1903 (WA) for the beneficiaries.
Commonly, a Deed of Family Arrangement may be used where:
- A beneficiary is disclaiming their right to an inheritance;
- The beneficiaries agree to change how the assets are distributed between them; or
- The beneficiaries agree to include a child or grandchild who did not receive an inheritance under the deceased’s Will.
A Deed of Family Arrangement may be a faster and more cost-effective way to effect the desired change to the distribution of assets.
Consider the example where the deceased, John, has a Will and John’s estate has:
- A residential home valued at $200,000; and
- A bank account which holds $200,000.
Mary wants the cash while David wants the property, but John’s Will provides that John’s estate be distributed as follows:
- Mary is given the residential home; and
- David is given the $200,000 in the bank account.
In this scenario a Deed of Family Arrangement is a faster and more cost-effective way to achieve the desired outcome than David buying the property from Mary as:
- The settlement process to transfer the property to David is much faster and simpler; and
- Mary and David can reduce legal and settlement costs and stamp duty.
For more information or to discuss how we may be able to assist you, please don’t hesitate to contact our wills & deceased estates team.