The recent case of Chen v Lu [2014] NSWSC1053 serves to highlight the jurisdiction of the court in respect to making family provision orders in relation to property held outside the State.
The family provision area of law exists in some form in all Australian states and territories. Family provision law recognises that, although people are free to give away their property by will after they die, or to not make a will at all, they also have an obligation to provide for certain people, usually family members.
In this particular case Mrs Hong Jie committed suicide leaving a Will made 8 days prior to her death with the whole of her estate being left absolutely and beneficially to her sister, Hong Wei. Probate was granted to Hong Wei. Mrs Hong Jie’s estranged widower – Mr Chen, filed a claim on behalf of himself and their nine-year old daughter for provision out of her estate and notional estate.
The deceased’s estate in Australia was worth $325,000 whilst the estate (including real estate) in China was worth $700,000.
Interstate or Overseas Properties
The (NSW) Succession Act 2006, s64, provides that a family provision order may be made in respect of property situated in or outside New South Wales when, or at any time after, the order is made, whether or not the deceased person was, at the time of death, domiciled in New South Wales.
The reach of this Act extending to immovables outside New South Wales of testators who die domiciled in New South Wales, see Balajan v Nikitin, 60-61; Hitchcock v Pratt, [19]].
In this particular case Hong Jie died domiciled in New South Wales, thereby giving the Court jurisdiction to make a family provision order in respect to the estate in China.
The Decision
The court ultimately ordered on the basis of the family provision that a legacy of $100,000 was required to provide for Mr Chen. With an additional legacy of $225,000 to be held in trust for their daughter, to cover the costs of private school education, contingencies, and to contribute to her tertiary education and/or start in life.
For advice on family provision orders or other estate planning issues, please don’t hesitate to contact us.
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