Nathan & Jenny
By Tammy McLeod
Nathan and Jenny had both been married before and had children from previous marriages. After a number of years together, juggling the demands of a blended family, Nathan and Jenny decided to get married. They had a quiet ceremony with their respective children and then a big party with extended family and friends.
Nathan and Jenny had bought a property together a few years prior. They had contributed equally to the purchase price and so hadn’t felt the need to enter into a relationship property agreement as their lawyer had advised them to do. Their children were adults and Nathan and Jenny felt comfortable that if one of them died, the survivor would be able to have all assets and then they would pass them on to all four of their children equally. Nathan and Jenny had changed their wills to reflect this when they purchased the house, but didn’t even think about changing their wills after they married.
Tragically while on holiday, tramping in the Abel Tasman at Christmas time, Nathan suffered a massive heart attack. He was air ambulanced to Nelson hospital, but sadly died not long after arrival at the hospital. Jenny was devastated.
A few weeks after Nathan died, Jenny went to see their lawyer to discuss how things would now proceed. Unfortunately things weren’t quite what she thought. When they had originally purchased their house their lawyer had registered Nathan and Jenny on the title as “tenants in common in equal shares” instead of jointly. What this meant was that Nathan’s share in the property fell into his estate rather than being left directly to Jenny as they had thought.
What further complicated matters was that Nathan and Jenny had not up-dated their wills when they married. This meant that the wills they had done prior to marriage were now null and void, and that the distribution of Nathan’s estate would be governed by the Administration Act. Jenny would receive the first $130,000 of Nathan’s estate and 1/3 of the balance – the rest would be distributed to his children.
For Jenny the reality was that she could lose her house. It is so important to review your will whenever your circumstances change – it is also important that when buying property you understand the different types of ownership structures and how they may impact on your estate planning.
Tammy McLeod, Director.
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