A recent high profile case has highlighted the need for testators (will makers), charities and lawyers to work together to reduce the likelihood of an estate being contested and to be properly prepared if an estate is ultimately contested.

Many of you may have read recently about Peter and Julanne Quinlan. Peter at 53 was diagnosed with terminal lymphoma. Together they decided to appoint a local lawyer in Cooroy as their executor and gift their 40 hectare property to the Australian Koala Foundation (AKF). Once they believed their affairs were in order they committed suicide.

Peter’s mother Carmel Quinlan received a phone call a few weeks after her son’s death advising her that she should consider contesting the estate and that the lawyer on the phone could assist. Peter and Julanne had no children. Court records show that Mrs Quinlan placed a caveat over the application for a grant of probate of the will, though this was later withdrawn and probate was granted on 16 July 2009.

This is a disappointing case where a beneficiary may have been seen as an easy target because it is a charity. The mother made a family provision application (FPA) where she had little or no claim against the estate. However if the AKF did not take a firm stance they could have lost a substantial part of the gift. It is imperative that charities at a minimum get specialist advice on the prospects of success of an FPA and they should defend their entitlement from less meritorious claims such as this.

The chief executive of the AKF, Deborah Tabart has been quoted as saying that the organisation was completely unaware of the couple’s bequest and that the AKF had no prior contact with them. It is important for all charitable institutions to keep appropriate contact with their donors and to keep records of people who donate and those who have advised that they may leave a gift via their will. On the other hand testators should be advising charities of their wish to gift property or sums of money to them. They do not have to specify the amount. Such records often provide valuable evidence against a FPA.

Lawyers also need to advise testators that if they leave gifts to charities they should write out a letter stating the motives for the gift or that they should contact the charity/s involved. This would mean that if an estate is contested, the charity would be able to show the court the rationale behind the testator’s decision.

Interestingly, supposedly Ms Tabart was only advised of the gift and then the potential claim against Peter’s estate through the media. This raises the issue that lawyers must be conscientious about advising all beneficiaries (not just charities) as quickly as practical about their entitlement. Beneficiaries should be advised who the executors are, be given a copy of the will and advised of the process and possible time frame to collect and distribute the estate. All beneficiaries have a right to be kept informed on the process of finalising an estate and they can demand proper accounting from the executors.

This case highlights the importance of communication between all parties involved in succession planning. It also shows the potential benefits from charities recording their relationships with donors and visa versa. Lastly charities should seriously consider defending entitlements from less meritorious claims against estates and should at a minimum seek advice on the prospects of success such a claim might have before signing away their entitlements.

Further information

For further assistance or enquiries please contact:

Scott Whitla on 07 3233 8778
Kimberley Davis on 07 3233 8768.