The Australian Securities and Investments Commission (ASIC) is taking legal action with the aim of securing compensation for investors in the failed property investment group, Westpoint.
ASIC believes that, if successful, the legal action could provide benefits to 3600 out of some 4300 investors. Investors can find out detailed answers to the most frequently asked questions about the compensation proceedings, including whether they are likely to benefit, by clicking here.
Q. Our 92-year-old mother, who has Macular Degeneration, lives alone on her 50 acres and has been stripped of her life savings by a conman doing a botched asphalting job. What can we do?
He drove her to the bank to get the money; the job was only for a few metres, not the 100 metres he did. We live in NSW, and I notice the TARS site is basically for people who live in institutions. We have contacted the police but have been told we would have to take civil action as Mum handed over the money. There are no written quotes, documentation or receipts, so we don’t have any idea where to start.
A. The EAPA (Elder Abuse Prevention Association) has advised the following:
“This is definitely a criminal offense and fraud on the part of the conman.
Your writer should notify the police again and speak to the Fraud Investigators in the CID [Detective Division] of the Crime Department. The investigator will go from there.”
Click on the following link to access the EAPA website, should you wish to contact them for more information. http://www.eapa.asn.au
Q. We are both getting on in age and are contemplating preparing a will. We have the plans in mind but need to put it into a proper and legal documentation. Could you advise us on the procedure and cost of the will preparation?
A. We would always recommend getting professional advice for any matter such as this and shopping around can make a difference. The cost of making a will can vary greatly depending on the work involved and I would suggest consulting www.aussielegal.com.au, a website that offers useful advice, guidance notes, competitive prices and do-it-yourself will kits, which make a cheaper alternative. Qualified and practicing lawyers run this site, which is a very good place to start.
If you shop on the internet, as many do these days, be careful of emails asking you to pay fake ‘customs’ costs. The Australian Competition and Consumer Commission (ACCC) is warning people of this latest internet scam.
Fake emails asking people to pay fees, duties or taxes on their goods before they can be released by customs are just scams designed to procure form you your personal banking details. The email may look official but customs would never make contact with you by email.
The ACCC says that certain goods brought into Australia do require an import permit and customs may detain such goods pending presentation of the permit. But where goods are detained for permit reasons you will receive written advice by mail from customs.
If you receive a suspicious email, the best thing to do is to delete it then and there. Never send money or give credit card or other banking details to anyone you do not know or trust. If you don’t know the source of the email, don’t click on the links in an email or open any attached files. Never call a telephone number that you see in a spam email.
To fid out more about import regulations and buying goods over the internet, call customs on 1300 363 263 or click here. To report a suspected scam, call the ACCC Inofcentre on 1300 302 502. For more information on scams, go to the SCAMwatch website by clicking here now
Perhaps you offered to deal with a seemingly simple bureaucratic matter on behalf of a friend or family member, only to discover you have no authority and cannot do a thing. Everyone, no matter what age, needs a Power of Attorney.
This article from Your Life magazine outlines why a Power of Attorney is so important, what the different types are and what could happen if you don’t have one. Remember this is a state issue, so terminology and details differ from state to state.
Think you don’t need a Power of Attorney? Here are a few good reasons to use this simple safeguard.
Whether far from home in a remote jungle or unexpectedly incapacitated in hospital, you could regret not appointing someone you trust as your Power of Attorney. For instance, if you have an extended hospital stay, bills will still need to be paid. Or while you are on that three-month Italian sojourn, there could be myriad impossible-to-anticipate administrative and financial details requiring your signature and which no one else can help you with unless they have been granted Power of Attorney. Or perhaps your parents are overwhelmed by call centres, being put on hold and having to remember endless passwords just to ask a simple question about financial or household concerns. As they age, it could make life easier for all if you can represent them and sign on their behalf. You may think a Power of Attorney is only necessary if a person is totally incapacitated, but even if you want to be able to help your parents with something as simple as a telephone account or withdrawing cash it is vital to have been granted Power of Attorney. Don’t assume the beneficiaries of a will have the power to act in such matters – they don’t.
What is a Power of Attorney?
A Power of Attorney is a document which means that the person to whom it is granted becomes virtually indistinguishable from the person granting the Power of Attorney, in so far as the institutions which require transactions to stand up in court are concerned. More than one Power of Attorney can be appointed if it’s appropriate. But decide if they will be able to act only together (jointly) or together and separately (jointly and severally). If one person could be away when a signature is needed, it might be worth them being able to act separately.
Are there different types?
There are four main types of Power of Attorney and each state and territory has slightly different uses and powers for the different types. See the MORE box at the end of this article for where to find specific information for your state or territory. 1. General Power of Attorney is for use when you can’t sign anything because you are hiking in Thailand or because you are in hospital. You may wish to consider having an expiry date for a General Power of Attorney if you are going overseas.
2. Enduring Power of Attorney is more powerful. It comes into use when someone has no means of looking after themselves and documentation has to be dealt with in regards to their long-term circumstances, often to do with living arrangements. A General Power of Attorney would not continue to be effective should the person lose mental capacity but an Enduring Power of Attorney would. Check your state’s laws in regards to the specific boundaries and definition of this type of Power of Attorney as there can be crossover with Enduring Guardianship (see below).
3. Medical Power of Attorney is known under different names in different states: in the ACT, Enduring Power of Attorney; in Victoria, Enduring Power of Attorney (Medical Treatment); in SA, Medical Power of Attorney; in NSW and Tasmania, Enduring Guardianship; in WA, Guardianship Orders; and in the Northern Territory, Medical Enduring Power of Attorney. It’s about appointing someone to make life and death decisions, such as whether to continue with life support. You might want to appoint someone in this role if you have no living relative, as hospitals will usually make such decisions in collaboration with the family.
4. Enduring Guardianship is important if someone can no longer make decisions about where to live, whom to live with, what health care to receive, and daily issues like diet and dress. In some states you will need an Enduring Guardian rather than an Enduring Power of Attorney to decide on living arrangements.
What does it cost?
You can buy a Power of Attorney from any legal stationer for about $5, but it can be a complicated process to fill it out, requiring correct numbering, layout etc. It’s worth paying a lawyer to cross every ‘t’ and dot every ‘i’. The minimum legal cost would be $200, more if you have to be visited in hospital. So get it done now and save everyone the hassle later.
Why you should get one now
There will be someone you trust to look after you or your parents’ personal and financial affairs in a manner of which you or they would approve. Not having a Power of Attorney can create enormous logistical problems for children or friends and can hold back important processes. It can help save legal costs should problems arise with financial situations and matters end up in court. Most of all, if you or someone you love hasn’t appointed a Power of Attorney, no one has that most precious commodity – peace of mind.
Disclaimer
The information provided is of a general nature, and should not be construed as legal advice. The information is provided solely on the basis that readers will be responsible for making their own assessment of it. Please contact AussieLegal for further information:
Ph 1300 728 200
Web http://www.aussielegal.com.au
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Who’s who
Here are the relevant government websites for each state. Just type ‘power of attorney’ into the search window of the web page.
New South Wales
Web www.nsw.gov.au
Northern Territory
Web www.nt.gov.au
Queensland
Web www.qld.gov.au
South Australia
Web www.service.sa.gov.au/agencies.asp
Tasmania
Web www.tas.gov.au
Victoria
Web www.justice.vic.gov.au
Western Australia
Web www.justice.wa.gov.au/portal/server.pt
The importance of estate planning cannot be overstated. To find out all about probate, joint ownership of assets, what happens if you don’t have a will, and the cost and expectations of being an executor.
Read these two articles from Your Life magazine to learn about the process for those left to sort out the often complicated and time-consuming legal tasks involved with an estate. Plus, there is information on how more and more people are including community and charitable organisations in their legacy – a wonderful expression of an individual’s values and beliefs.
We may be leaving it all behind, but there’s work ahead for our families and executors in distributing our worldly goods when we die, as Mark van den Berg explains.
We read a lot about legal wills and how important they are. But we don’t often read about what happens after someone dies – from a legal aspect, that is. Understanding what your family will be required to do when you do quit this life may affect how you arrange your estate.
What is a will?
A will is a document that contains your instructions on how you want your property (including assets such as land, a home, shares, cash etc.) to be distributed after you have died. It can also set out who you want to look after any children who
are minors if the unthinkable happens to you and your partner – an unhappy thought, but an essential consideration if you have young children.
What happens after you die?
Your nominated executors are responsible for ensuring that your wishes are carried out. In the vast majority of cases, this means dealing with your assets. The most common assets in a typical estate are bank accounts, shares, motor vehicles,
real estate, superannuation, life insurance policies and personal possessions. Your executor’s job is to have these various assets sold, or transferred into the name or names of the beneficiaries listed in your will.
Now comes the hard part. Your executor will need to contact the company, body or government department that controls the title to those assets and request that they transfer the asset either into the name of the executor if the asset is to be sold, or directly into the name of the beneficiaries. In some cases, the controlling body will oblige after you send them a copy of the will and death certificate. But in other cases, the controlling body will ask for a Grant of Probate from the Supreme Court before they will transfer the assets. The type of asset and whose name or names are on the title of the asset will determine if a Grant of Probate is required. The reason they ask for this document is to protect themselves against being sued by someone who may have a financial claim of some kind against the estate. It is worthwhile noting that there are no death duties in Australia. The application for a Grant of Probate is not about the State collecting money. It is a ‘due diligence’ processdesigned to ensure that your estate is properly administered.
Assets in joint names
Jointly-owned assets are assets that are in two or more people’s names. For jointly-owned assets, such as real estate, title to the asset automatically passes to the second person when the first person dies. The title laws override the laws covering wills and probate, and thus jointly-owned assets would not be covered by a will. Examples of assets in the sole name of the deceased that are normally subject to probate include land and real estate, bank and savings accounts above $10,000, share accounts where the value of each separate company is above $15,000 and, in some cases, life and superannuation policies. Examples of assets where probate is usually not required include motor vehicles, personal possessions and, in some cases, life and superannuation policies. Your life insurance policy and superannuation account are a little different from other assets in that in some circumstances they form part of your estate, and are therefore subject to probate, and in some cases they are excluded from your estate, and therefore not subject to probate. If you have named a specific beneficiary or beneficiaries in either of these, then on your death, title passes directly to them. If you have not named a specific person or persons, then the monies will be deemed to be part of your estate. The insurance company or super fund will almost certainly require a Grant before they will release the funds to your beneficiaries.
The probate process
So what exactly is required to obtain a Grant of Probate? The executors named in your will are required to make a formal application to the Supreme Court in your State for a Grant of Probate. The application consists of a number of completed forms and affidavits (sworn statements), your will, the death certificate, and a copy of the death notice placed in the newspaper. As each State has different requirements, the format, content and number of forms for the application vary. The Probate Registry with the Supreme Court is the area that would process your application and they are extremely pedantic about the accuracy and content of the forms. A misspelled name is sufficient to cause the rejection of an application. Once the Grant is issued, your executors will have the authority to deal with your estate.
What happens if you die without a will?
If you die without a will, your assets will usually be divided according to the intestacy laws in your State. The result of this is typically that your property may not be divided according to your wishes, your children and other minors in your care may not receive the financial and other assistance you would have desired, your de facto spouse, stepchildren, friends and favourite charities may miss out and your estate may be administered by someone of whom you disapprove. State intestacy laws typically have
fixed rules on how your estate will be divided among your family members. Unfortunately, it will be extremely difficult for your family to change this outcome if they are not happy with the way the estate is distributed. As the body controlling the title to your assets requires a Court authority before releasing the asset, an application to the Supreme Court still needs to be made. The application process is similar, but follows different rules and is more complex than probate. In this case, the application can only be made by a relative or, in special circumstances, a person who has a valid claim on your estate. The application would be for a Grant of Letters of Administration, and the applicant would be seeking the role
of administrator of your estate.
What is the cost and how long does it take?
If you have been asked to be an executor, or you wish to apply to be the administrator for a relative, you have a number of options with regard to applying for a Grant. A solicitor will typically charge $3000 to $5000 to prepare the application for a Grant of Probate and $5000 to $8000 to prepare an application for Letters of Administration. In addition to the legal fees, there is the cost of advertising and the Court filing fee of around $500. An application by a solicitor will usually take two months to six months. However, there are alternatives. At AussieLegal we have created a number of DIY legal kits to assist people, including a range covering probate and Letters of Administration. The kits are complete with instructions, example forms and blank forms that can be edited and are written in plain English. The price of Handling Probate kits ranges from $199.95 to $999.95, depending on how much you want to do yourself, while the Letters of Administration kits range in cost from $499.95 to $1499.95. Personal applications can be done in as little as three to four weeks.
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AussieLegal is a legal information and law firm referral service; Mark van den Berg is the organisation’s managing director. The services AussieLegal offers include Legal Advice Line, Finda-Lawyer, DIY legal kits, a legal forum and access to a range of legal articles.
Ph 1300 728 200
Web www.aussielegal.com.au
Email
Contacts for State probate offices are:
Probate Division, Supreme Court NSW
Ph (02) 9230 8111
Probate Office of NT
Ph (08) 8999 7953
Probate Office of Tasmania
Ph (03) 6233 3716
Probate Office of Victoria
Ph (03) 9603 9296
Probate Office of WA
Ph (08) 9261 7699
Probate, Registrar ACT
Ph (02) 6267 2761
Probate, Registrar Queensland
Ph (07) 3247 4313
Probate, Registrar SA
Ph (08) 8204 0505
When it comes to making a will, many people are now opting to take a more community based approach and endow a long-lasting
financial legacy to their preferred charity, says Mark Robinson.
It’s a very personal gesture and often a very important component of people’s lives, even if they cannot give as much as they would like. Armed with the right information, it is relatively easy to follow this path and make plans to donate a proportion of wealth either during one’s lifetime or after death. In general terms, there are four ways to make a donation. Each option
has taxation and other financial and practical implications and you may require expert assistance to determine the best strategy for your circumstances.
1. Give directly
Historically, the first choice for many people has been to donate directly to an established charitable organisation, either in their lifetime or by making a bequest in their will, but a lack of transparency can be a drawback here. In some instances, the organisation’s use of the funds is apparent. The Cancer Council, for example, has clearly-defined goals and donors can expect their donation will be used to support cancer research or assist cancer sufferers in some way. However, sometimes it is not clear how the donated funds will be used, which can trouble donors. For example, some aid organisations provide assistance across a very broad range of activities and countries. Additionally, administration costs can be unclear and there is rarely an opportunity to see a tangible result from a donation.
2. Establish a Prescribed Private Fund
Prescribed Private Funds (PPFs) are private charitable foundations that provide a way to donate money in perpetuity and can best be described as an ‘agent’ between the donor and existing charitable organisations. Unlike direct giving, a PPF allows the donated capital to be retained inside a charitable trust controlled by an individual or an entire family. The income generated is distributed annually to a range of charitable organisations chosen by the
founding individual and their family. Where trustees of PPFs identify similar interests and goals, they may embark on joint ventures over a nominated period in order to provide funding for a project that would otherwise be too big for any one fund to support on its own. PPFs must distribute income annually to recognised charities and there are clear definitions about the sort of projects that can be funded. If desired, provision can be made for the charity to receive a certain percentage of the capital each year, plus income.
3. Donate to a Foundation offering Donor Advised Sub-Accounts
These are charitable trusts established and administered by a trustee company that allow intending donors to donate to a ‘sub-account’ within the trust. This relieves a donor from the cost and compliance issues involved with having their own foundation. However, like PPFs, donors still retain control over the manner in which their donation is used. For example, if an
individual donates $250,000 to a Donor Advised Sub-Account and nominates that the income go to animal protection charities, the foundation directs the donor’s income to those nominated charities each year. Donations can be made to a Donor Advised Sub-Account throughout a person’s lifetime, or in their will. Patrick Rafter’s Cherish the Children Foundation is a well-known example of a Donor Advised Sub-Account in a foundation operated by a
trustee company.
4. Establish a Testamentary Charitable Trust in a will
Establishing a testamentary charitable trust (TCT) as part of an estate plan is another way of
providing chosen charities with a reliable annual income stream in perpetuity. As is the case with PPFs and Donor Advised Sub-Accounts, the donated capital is invested and the income distributed to objects or purposes detailed in a person’s will. And like PPFs, provision can
be made for a charity to receive a certain percentage of the capital annually, plus income.
Tax implications
As indicated at the start of this article, each of these methods of charitable giving has its own tax implications and you may need the assistance of an expert in tax to work out which is the best for you. For example, donations made via the first three options are tax deductible, which may encourage or enable you to make further donations so your gift can keep growing. In the case of TCTs, however, their growth is limited by their very nature, i.e. they only become effective on the death of the person making the will and any donations made by others to top
them up are not tax-deductible. On the other hand, if the will-maker gifts an asset normally subject to Capital Gains Tax (CGT – like a house) to a TCT in a will, it is usually exempted
from CGT, preserving the full value of the gift.
Choosing trustees
Just as the structure and tax aspects of your charitable giving need careful consideration, so does the choice of trustee to manage any charitable trust in which you choose to become involved. The trustee plays an often time-consuming role in managing the trust. This includes meeting all legal and taxation requirements, ensuring that the funds are invested for the best possible returns and distributing the trust allocation. This can be a major burden for an individual. However, it is all part of the role of a professional trustee, so appointing a trustee
company is a popular answer for many. A trustee company not only provides expertise in investment and knowledge of developments in philanthropy, it also provides continuity in the management of the trust that will usually continue in perpetuity.
Disclaimer: This is intended to provide general information in summary form on the topics discussed and is current at the time of publication. The contents do not constitute legal, tax or financial advice and should not be relied upon as such. You should seek professional advice before acting on any information contained in this article.
Mark Robinson is an estate-planning specialist with national financial services firm Australian Executor Trustees.
Ph (02) 9028 1056
Email
MORE
Further information on charitable giving can be found by contacting:
Australian Executor Trustees Australian Tax Office
Web www.aetlimited.com.au Web www.ato.gov.au
or by phoning your favourite charity direct.
If you are in need of help with your tax return and live on a low income, the tax office may provide someone to assist you.
Community volunteers are trained by the tax office to go out into the community and help those with English as a second language and those on low incomes to prepare their tax returns.
To find out if you are eligible for this program, to make an appointment, or to find out the community centre or library nearest to you where the program is being held and call the Tax Help Centre on 13 28 61.
Australian Government Family Assistance Office
Law Council of Australia Family Law Section
Law for You: Children – care and contact
Victoria Legal Aid – People and Relationships – parenting orders
Victoria legal Aid You & Family Law – A 68-page PDF file.
A specialist in elder law at the University of Western Sydney has called for the creation of specialist legal centres across Australia to help older people who may be vulnerable to abuse of their finances. Some government agencies provide general assistance, but more specific legal information and education could help prevent older Australians losing their savings.
Older people are often the target of unscrupulous financial traps but it can also be the people who are closest to them who deceive. “A loss of trust and the associated shame can also cause depression and health problems,” says Sue Field, elder law specialist form the University of Western Sydney.
Health professionals often pick up on signals that point to the financial problem but more legal services could be provided to educate people on their rights and to offer legal assistance. Currently there are guardianship tribunals which assist people with wills, enduring powers of attorney, guardianship and aged care legislation. But they are not necessarily education-orientated.
Legal centres could focus their attention on providing elder law information and training sessions for senior citizens groups, lawyers and health care professionals. Sue Fields says one area in which there is the potential for misuse is with enduring powers of attorney.
“There is no requirement to register an enduring power of attorney unless you are engaging in property transactions and this means there is no public record and so no checking mechanism. It’s illegal to abuse a power of attorney but by the time such abuse is discovered, the money is usually gone.”
Elder Law is a major legal area in the US and Sue hopes Australian educators and governments will follow.
