Resolving Deceased Estate Law Property Disputes

In this article we explore how the appointment of a statutory trustee interacts with deceased estates and disputes between beneficiaries of an estate holding real property.

There are a few key reasons why a dispute may arise between the beneficiaries of a deceased estate (named or otherwise). Primarily, we consider it comes down to human nature, the existence of diverse views and positions regarding entitlement, the value of property and approach to any sale. In terms of underlying reasons, it all comes down to each individual set of circumstances. Some possible examples might include the respective wealth of each beneficiary, lifestyle choices, the value proposition of real property as an investment, which is further accentuated by the ever-decreasing affordability of housing for younger generations. More recently, the impact of COVID-19 pandemic on property prices nationally has also meant there is arguably even more to squabble over.

Property Disputes in Estate Law

Relevantly, both simple and complex Wills that leave real property to individual beneficiaries can give rise to disputes. Frequently beneficiaries are unable to agree on what is to happen to the estate property and any family home of course carries the added element of emotional connection.

Real property remains in the most part, the most significant asset in a deceased estate and its existence can often lead to a wide range of issues to consider (putting aside challenges to the Will). A non-exhaustive list of those issues might include:

• Keeping the property in the family (e.g. if its an investment property/holiday home)

• Who will reside in the property, and will that person pay rent or an occupation fee (particularly if not tenanted by an unrelated third party)

• Who will maintain the property and pay for upkeep or repairs

• Who will maintain/manage any loans and ongoing repayment obligations whilst an agreement can be reached on how the property is to be realised

• Do any of the beneficiaries either solely or jointly with other beneficiaries have a desire and realistic capacity to refinance to acquire other beneficiaries interests.

• If decision to sell has been agreed upon

  • when to sell

  • who to appoint as agent and who will provide instructions

  • what sales method/process will be used

  • who will approve advertising wording and photos

  • who does the conveyancing and who will provide the instructions

  • how much to accept i.e. what is the property worth, whose opinion/valuation is correct etc.

  • how will the costs of sale including agent commission, marketing fees and legal fees be paid

In general, and largely as a result of the costs and time of going to Court, most estate disputes are resolved via negotiations or formal mediation either outside of or in the early stages of the court process. Although, often as part of that process, it is mutually agreed between owners or one owner seeks the appointment of a Statutory Trustee to sell the property to mitigate most of the potential issues outlined above.

Often parties manage to resolve their estate property disputes without the need of a court intervention. Notwithstanding that, a significant portion of our Statutory Trustee appointments are related to deceased estate disputes between siblings left a property (sometimes years after the death of their parents).

What to do if beneficiaries cannot agree

Once a beneficiary is transferred an interest in real property, they will be recognised on title as being an owner/co-owner. At that point, were co-ownership exists, there is a fundamental right to apply to the Court to sell a property and realise that interest. This is achieved by asking the Court to appoint a Statutory Trustee and bring some often much needed independence to the situation.

The appointment of a Statutory Trustee should take away a lot of the noise associated with the issues highlighted above. Additionally, whilst it is preferred that any issues around who gets what at settlement are resolved prior to or as part of the statutory trustee application, this can still be resolved after the property has been sold.   In fact, the appointment of a statutory trustee will often assist with escalating a resolution on this issue, as once the property is sold, it becomes a squabble over a liquid asset, cash.

The earlier a decision can be made is in our experience likely to see outcomes that are significantly better for all beneficiaries. In particular, by avoiding a potentially costly, long term legal dispute which will often be less efficient and has the real potential to erode any equity available once the dispute has been resolved. It is also not uncommon in our experience for the costs of a legal battle to exceed that of the Statutory Trustee process.  

How can QSAS help?

Wherever you’re located, the QSAS team can help you find the right solution to resolve your (or your client’s) deceased estate property dispute. Contact us today for a confidential, no-obligation consultation to find out more about the options that might be available and how a statutory trustee appointment may assist.