Protecting Important Documents When A Crisis Hits

The bushfires in Victoria and the floods in Queensland and New South Wales have resulted in a terrible loss of life and property – raising the issue of losing and replacing important documents.

Reports have emerged of the difficulties some of the victims of the disasters have experienced when seeking emergency benefits. They have no documents to establish their identity as many had to flee with nothing more than the clothes they wore.

The destruction of family homes and businesses will mean that many people have lost original documents including wills, powers of attorney, birth and marriage certificates, driving licences and passports.

Whilst most of the documents may able to be replaced, it will take time and expense. It is a frustration which people who have experienced such devastating loss could well do without.

And, often the loss of the document is not realised until it is too late. The missing passport only comes to mind when packing for the overseas holiday or, more tragically, the destroyed will is only found to be missing after the death of the will maker. By then, it may be too late!

When a person dies and no will can be found, the law presumes that they have died “intestate” (died without a will). In that case, laws in each State determine who gets to share in the estate assets and in what proportions.

Often, the State laws can have unintended consequences. A former spouse who has separated from but remained married to the deceased person may be entitled, at law, to a share of the deceased spouse’s estate – even if they separated many years ago.

Also, the laws in each State are not the same and if someone dies intestate, the people who will share in the estate and the proportions they will get vary from State to State. Fro example, many people mistakenly believe that the surviving spouse will inherit the whole of the estate if there is no will. If the deceased person died leaving behind a spouse and children, then in Victoria, the surviving spouse is entitled to the household furnishings, $100,000.00 and one third of the rest of the estate. The children share the rest. In New South Wales, the spouse will receive the household items, $200,000 and half the rest of the estate.

These laws may lead to different people sharing in different assets in different proportions, depending on where the deceased person lived and where the assets are located.

Not only do these State to State variations cause confusion, if someone dies without a will, the appointment of a person to administer the estate and work out the entitlements of who gets to share in the estate assets leads to increased costs, delays and loss. In a will, the will maker appoints an executor to administer the estate – to protect, preserve and gather in the assets, pay the debts and other expenses and then distribute the estate assets to the beneficiaries named in the will.

But, if a business owner dies without a will, determining who can step in to run the business may take days, weeks or months to resolve especially if there is a dispute amongst the family members. By the time it is sorted out, often after court action, it may be too late – what was a valuable business is now worthless as no one had the immediate power to step in and take control.

If someone dies and the original cannot be found, there may be a copy of a will in a solicitor’s file or held by an accountant or financial advisor. In some circumstances, a copy of a will may be regarded as a valid will. However, before a court will accept a copy as a valid will, extensive evidence must be gathered to establish where the original will was stored, who had access to it and what actually happened to it prior to the will maker’s death. A court must be satisfied that the original will was inadvertently lost or destroyed and not intentionally destroyed by the will maker who wanted to cancel it.

There have been many occasions where an original will has been located in the strangest places – under floorboards, in the chook pen, in a secret concealed passage. Whilst the will maker may thought the will was safely stored, there is the risk it will never be located or destroyed. Even if the original document fortuitously is found, its authenticity may be questioned because of the way and where it is “found”. Costly court disputes usually follow to determine if it is a valid will.

For all of these reasons, it is important to think carefully as to where important original documents should be stored. Rather than keeping the original will at home (tucked away safely where no one may find it or where it may get destroyed in a flood or fire), it is much safer to keep wills in safe custody with your solicitor or in a bank vault. In some States, registers of wills are held by courts. However, most people prefer to keep the contents of their documents private and keep them with their lawyers.

Wherever the document is stored, there should be some way to trace where the documents are located. It is important that family members or the executor knows where the original will is located so it can be accessed at the appropriate time and by the appropriate people.

“Proper thoughtful planning now gives you peace of mind and ensures that your loved ones will not have to pay, financially and emotionally, later.”

Phillip McGowan