The Importance of Strictly Wording Binding Documents

The Importance of Strictly Wording Binding Documents

The Importance of Strictly Wording Binding Documents

We recently acted in an estates matter where the deceased had nominated his estate trustee as the beneficiary. The deceased had completed a pro forma binding nomination, however where there was an option to nominate a “legal personal representative” (an executor), the deceased instead wrote “trustee of deceased estate”.

The Court ruled that there is a difference between an executor and a trustee, therefore, the Court found that the deceased meant for his nomination to be the trustee of his will rather than the executor, for which there was no one appointed.

The binding nomination was held to be invalid as it failed to meet the terms of a trust deed because he failed to name an executor, therefore the deceased’s second wife and one of his daughters were appointed as trustees, which allowed them the ability to pay the funds in the Self-Managed Super Funds to whomever they pleased while his other daughters who were the beneficiaries of his will missed out.

This demonstrates the importance of producing flawless wills and trust deeds because, once you pass, a Judge can only interpret what he believes your words intend to mean. Strictly wording a binding nomination in accordance to your trust deed is imperative in finalising your estate.

If you have had problems executing a will or a trust deed, or would like us to review any binding documents you have,
feel free to contact us at estates@hatzis.com.au or call 1300 HATZIS (1300 428 947) .

 

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