On 7 December 2017, after a long and heated campaign, Australia became the 26th country to legalise same-sex marriage. The first same-sex marriage under the new legislation took place in Queensland on 15 December 2017 and since then more than 400 same-sex couples have been married.
The 2016 Census recorded 46,800 same-sex couples across Australia, so it’s likely there will be a boom in same-sex marriages as many same-sex couples decide to get married.
In this article, we look at some of the differences between the rights of de facto and married couples and then explain how marriage, divorce and separation can affect a Will and other estate planning documents. Any couples, be they same-sex or different-sex, who are planning on getting married should consider how marriage may affect their estate planning documents and whether they need to update them.
The term de facto comes from Latin and means ‘in fact’ - it describes practices that exist in reality, even if they are not legally recognised by official laws. For several years, de facto couples in Australia have had very similar rights to married couples. However, there are still situations where a de facto couple will have to take extra steps, compared to a married couple, to access certain provisions in the law and they may also have to prove certain elements of their relationship.
For a Court to make any family law property settlement orders, a de facto couple must meet one or more of the following gateway conditions:
A married couple does not have to meet any of these conditions before the Court can make property or spousal maintenance orders. Before a Court can order a property settlement or spousal maintenance a de facto couple must have ended their relationship – this does not apply to married couples.
When applying for a partner visa a de facto couple will have to prove their relationship exists and has existed for some time. A married couple will not have to do this.
When one person in a de facto relationship dies suddenly, the surviving partner can find themselves in a difficult situation. This is probably one of the most important differences between de facto and married couples and has the potential to cause the greatest emotional and financial damage. Depending on the state or territory, the surviving partner may need to prove the existence of a relationship. This would enable them to be listed on the death certificate as next of kin and to access government bereavement payments and superannuation benefits. Proving the existence of a relationship can involve having to provide evidence of living arrangements, their sexual relationship, finances and even how they appeared as a couple in public. In contrast, a partner who was married would only have to provide their marriage certificate.
This onerous burden can cause problems when other potential beneficiaries of the deceased try to minimise the importance of the de facto relationship so they can obtain a greater benefit for themselves.
Government bureaucracy can also be unwittingly cruel when they devalue de facto relationships. In Tasmania in 2015, when one of the men in a same-sex relationship died, his de facto partner was not allowed to see his partner’s body, nor was he recognised as next of kin. Instead, the coroner deemed the deceased’s mother to be next of kin, despite her being estranged from her son. The surviving partner was not allowed to be involved in the burial arrangements or funeral. This occurred when the law in Tasmania said partners in de facto relationship had clear rights but two different government departments interpreted the situation differently. Had the couple been married then this situation would not have occurred.
In Australia, marriage cancels a person’s previous Will. If a person marries and fails to update their Will they are considered to not have made a Will at all. And, when they die, the person would die ‘intestate’ and their assets will be distributed according to a pre-determined state-based legislative formula which sets out who gets what – sadly, this may not be what the person actually wanted.
The general exception to this rule is if a person made a Will prior to marriage which states that it was made ‘in contemplation of marriage’, meaning it was written with the specific intention that it would remain valid after marriage. This exception is not applied uniformly across the Australian states and territories. The differences are outlined below:
The precise wording of the contemplation of marriage clause is crucial and requires careful drafting to ensure that it’s effective.
While a Will may be the backbone of an estate plan, it’s only the beginning. A newly-married couple should also consider whether the following estate-planning related documents also need to be updated:
According to McCrindle, an Australian social research firm, around 33% of marriages will end in divorce1. Like marriage, divorce affects Wills differently depending on which state or territory the person lives in.
Before divorce, most couples separate and couples sometimes separate but never divorce. Unlike divorce, separation does not influence a Will. So, if the Will is not updated when the couple separate and the Will-maker dies, their existing Will remains valid.
As is the case with marriage, it’s essential that following a separation or divorce, the couple reconsider their other estate planning documents and decide whether they need to update them to reflect their separation or divorce.
This checklist has a range of other trigger factors you can discuss with your client to help you decide whether their estate planning documents need updating.
If you have any concerns in relation to your clients’ estate planning documents and would like to consult one of our estate planning lawyers, please call us on 1800 882 218.