What is Probate? — Probate is the legal process that distributes the assets of a deceased person to their heirs or beneficiaries.
It involves proving the validity of the deceased person’s Will, paying their debts, and distributing their assets according to their wishes. Despite being a common process, many misconceptions exist about probate in Australia.
In this article, we discuss ten common misconceptions people have about probate.
Misconception 1: Probate is always mandatory.
Many people believe that probate is always necessary when someone dies. However, this is not the case. Probate is only required if the deceased person owned assets in their name alone and those assets exceeded a certain value.
If the deceased person’s assets are below the threshold, they can be distributed without probate.
Misconception 2: Probate is expensive.
Another common misconception about probate is that it is expensive. While there are costs associated with Probate, such as court fees and legal fees, these costs are often much lower than people think.
The exact cost of probate will depend on the complexity of the estate and the fees charged by the executor and any lawyers involved.
Misconception 3: Probate takes a long time.
The misconception that probate takes a long time is not always accurate. The length of the probate process can vary depending on the complexity of the estate and the legal requirements of the jurisdiction in which the deceased person lived.
In some cases, probate can complete relatively quickly, especially if there are no disputes or complications with the estate.
However, in other cases, probate can take several months or even years to complete. It is important to seek legal advice to understand the specific requirements and timelines of the probate process in the relevant jurisdiction.
Misconception 4: Probate is always contested.
Another misconception about probate is that it is always contested. While it is true that disputes can arise during probate, many probate cases are uncontested.
If the deceased person had a valid Will and their assets distributed would be according to that Will, there is often little reason for anyone to contest the probate.
Misconception 5: Probate always involves going to court.
The misconception that probate always involves going to court is also not correct. While probate is a legal process, it may not always require a court appearance.
In some cases, probate can complete through a simpler administrative process if the estate is relatively small or if the deceased person had certain types of assets, such as joint tenancy property or assets held in a trust.
However, if there are disputes or complications with the estate, it may be necessary to go to court to resolve these issues. It is important to seek legal advice to determine the appropriate process for each case.
Misconception 6: The executor can do whatever they want.
The misconception that the executor can do whatever they want is not factual. Executors have a legal duty to act in the best interests of the estate and its beneficiaries. They must follow the terms of the Will and distribute assets accordingly.
If the executor breaches their duty, they can be held accountable and face legal consequences. Beneficiaries have the right to challenge the actions of the executor if they believe they are not acting in the best interests of the estate.
It is important for executors to act responsibly and seek legal advice if they are uncertain about their responsibilities.
Misconception 7: Probate is only for large estates.
The misconception that probate is only for large estates is not valid. In Australia, the threshold value for probate varies from state to state, but it is generally around $50,000. If the deceased person’s assets exceed this threshold, probate will be necessary regardless of the size of the estate. This means that even relatively small estates may need to go through probate.
Additionally, the complexity of the estate can also affect the case, as some assets or legal situations may require court approval or other legal processes.
Misconception 8: Probate is only for assets in Australia.
Another common misconception about probate is that it only applies to assets located in Australia. However, if the deceased person had assets located overseas, those assets may also need to go through probate in the country they situate.
Misconception 9: The deceased person’s debts die with them.
Some people believe that when someone dies, their debts die with them. However, this is not the case. The deceased person’s debts need settlement before the distribution of their assets to their beneficiaries.
If there are not enough assets to pay off the debts, the beneficiaries may not receive everything they are entitled to.
Misconception 10: Probate is not necessary if there is a joint tenancy.
The tenth common misconception about probate is that it is not necessary if there is a joint tenancy. While joint tenancy may avoid probate in some cases, it does not completely eliminate it.
If one of the joint tenants dies, their share of the property will be distributed according to their Will or intestacy laws, which may require probate. Additionally, joint tenancy only applies to certain types of assets, such as real estate and bank accounts. It does not apply to other types of assets, such as personal property and investments.
There are many misconceptions surrounding probate in Australia. Understanding the truth behind these misconceptions is important for anyone dealing with a loved one’s estate.
Probate can be a complex process, but the process becomes much more efficient and effective with the help of a qualified legal professional, such as Probate Consultants.
Professionals can tell you everything from what is Probate to the responsibilities of next of kin. Knowing the truth behind these misconceptions can help to ease the stress and uncertainty of the probate process.