Who will be your executor? When choosing executors and trustees for your will, we encourage our clients to take time to think who will be best suited for the role and also who would be good substitute executors and trustees should your first choice have predeceased you, or be living at the time of your death but are unwilling or unable to act. Why is it important to consider where your executor and trustee lives? It is increasingly common to have family members living permanently overseas, returning only occasional to see family. We encourage our will-makers to consider where your executor lives. If possible, we recommend that you consider choosing executors who live in New Zealand. However, we know that most parents usually like to treat all their children equally and often wish for all of their children to be appointed as executors and trustees in their will, so they are all the decision-makers. We do encourage will-makers to think how best to ensure their wishes in their will are carried out. The responsibility of dealing with different financial institutions is increasingly onerous, because of the increased compliance required by banks etc. Whilst we are skilled at assisting executors and trustees carry out their role, cutting through the red-tape, often our New Zealand based executors are able to navigate the processes more quickly whilst still keeping all the family informed throughout. Careful thought should be given when choosing executors and trustees who live overseas, especially if there will be a testamentary trust in the will, for example a share held for a child to the age of 25 years. This is because there will be a trust for the longer term and this potentially may have some tax implications if 25% or more of the trustees live overseas. Is it time for a review? We also encourage all our clients to regularly review their will, especially at different life stages. Importantly, when you get married then your pre-marriage will becomes void (unless made in contemplation of marriage) and you should have a new will. Also, if you separate or divorce you should review your will as soon as possible. If you need advice, and would like to review your will please give us a call 03 477 8080.

Can you be evicted from your own home and forced to sell your interest in the property to your ex-partner, when there has been no misconduct on your part? In short: if you are a registered co-proprietor of the property then no, you cannot. Imagine that, together, Jack and Jill own the family home and a rental property. After a period the relationship is over. Jill wants Jack to move out. Now, Jill can ask the Court to force Jack to sell his interest in the rental property to Jill. However, there are a number of factors which the Court will consider before doing so – in particular the hardship to Jack which may result from the forced sale, versus the hardship to Jill if Jack is not forced to sell. But the rental property is one thing. The family home – Jack’s home – is quite another. The Court will not order Jack to sell his interest in the family home to Jill. All things being equal, if you own the home that you live in, you cannot be evicted from it. If you need advice, give us a call 03 477 8080.

Attorney The Attorney is obliged to act in the best interests of the Donor. They also have a duty to consult the Donor whenever possible, and to encourage the Donor to act for themselves. In the case of a husband and wife, it may be appropriate for them to appoint each other in the first instance as their attorney and to appoint an adult child as their successor attorney. There are two kinds of Enduring Power of Attorney: in respect of Care & Welfare, and in respect of Property. If different Attorneys are appointed for Care & Welfare and Property, then they have an obligation to consider each other when making decisions. The Property Attorney needs to provide funding for the Welfare decisions, and the Welfare Attorney should consider the financial impact of their decisions. The Deed of EPOA can stipulate that certain people are to be consulted in any decisions regarding the Donor’s Property or Welfare. This is particularly useful if one child has been appointed as Attorney and the remaining children need to be kept advised of any decision making. Attorney Rights and Obligations The rights and obligations of an Attorney are governed by the Protection of Personal and Property Rights Act 1988 (“PPPR”), the PPPR Amendment Act 2007 and the Deeds of Enduring Power of Attorney themselves. An Attorney is required to: Act in the best interests of the Donor, while encouraging the Donor to develop the Donor’s competence to manage the Donor’s own affairs in property and personal care and welfare decision making. The Court can revoke the appointment as Attorney for failure to act in the best interests of the Donor; Encourage the Donor to understand the nature and foresee the consequences of decisions, and to communicate such decisions; Facilitate integration into the Community; Keep records of financial transactions as the property Attorney. Failure to do so is punishable by a fine not exceeding $1,000 for each separate offence; and Must not act for the benefit of themselves or others unless authorised by the Court or the Enduring Power of Attorney document. An Attorney is able to make investments, loans, advances under the Trustee Act 1956, and claim out of pocket expenses. Once a Donor has become mentally incapable the Family Court has the power to review an Attorney’s decisions. There are a number of people who can request the Court to review an Attorney’s decisions, these people are: Donor Relative or another Attorney of the Donor Social worker/Medical practitioner Trustee Corporation Manager of the hospital or rest home in which the Donor resides Donor’s Welfare guardian Elder abuse and neglect prevention service representative Any other person with the Court’s permission Suitability of Attorney The Legal requirements are that an Attorney must be: At least 20 years; Not bankrupt Not subject to a personal or property order under PPPR Act 1988. For an EPOA in relation to Property, the Donor can appoint a Trustee Company, but for an EPOA in relation to Welfare, the Donor cannot appoint Trustee Company – i.e. they have to appoint a person. Presumption of Competence Under the Act all Donor’s are presumed competent until proven otherwise. There is no longer any provision for partial lack of capacity; a Donor must wholly lack capacity before the Attorney can exercise their powers. Mental Incapacity – Proof Proof of mental incapacity is provided by medical certificate (prescribed) completed by a relevant health practitioner whose scope of practice includes assessment of a person’s mental capacity. The NZ Medical Council has confirmed GP’s and Psychiatrists qualify and has reserved its position, subject to legal opinion, as to what other health practitioners qualify. For an Enduring Power of Attorney in Relation to Property – a medical certificate is required before the Attorney can begin exercising any powers, unless the Donor has chosen to put the Property EPOA in effect immediately in which case mental incapacity is not relevant. For an Enduring Power of Attorney in Relation to Personal Care & Welfare – a medical certificate is required prior to making decisions on significant care & welfare matters; on other non-significant matters, mental incapacity is assessed by the Attorney based on reasonable grounds i.e. an evidence based assessment. The Donor’s mental capacity must be determined afresh, and for each of the significant matters, medically certified. If there are any doubts regarding the Donor’s mental capacity, obtain the medical opinion. The Attorney pays for the medical assessment and recovers the costs from the Donor. Suspend or Revoke Should the Donor lose but then subsequently regain mental capacity, they can suspend authority of the Attorney by written notice. The suspension does not terminate the Enduring Powers of Attorney and it can be re-activated if the Donor subsequently becomes mentally incapable again. The Donor can also revoke the authority by written notice. A revocation terminates the Enduring Powers of Attorney. If you need advice, give us a call 03 477 8080.

Probate is an order from the High Court which confirms a) the identity of the person who has died, and b) the identity of the people who will bear the responsibility of administering the deceased person’s estate. These people are called the executors. When is it needed? Probate is needed when a) the deceased person’s estate looks as though it is going to be worth more than $15,000.00, and b) the deceased person had a Will. If they had more than $15,000 but they didn’t leave a Will, then Letters of Administration are needed (you get these from the High Court too). Why is it needed? Probate is needed by the executors so that they can deal with the deceased person’s assets – i.e. the estate. Without Probate, the executors can’t sell property, close bank accounts, or do much of anything else in respect of the estate. At least, not legally… How do you get it? The executors of the estate – with the assistance of the lawyers who act for the estate – apply to the High Court. How straightforward the application end up being, will depend on other circumstances that surround the estate. For any questions regarding Probate, give us a call 03 477 8080.

Executor/Trustee The Executor/Trustee is the person (or persons) responsible for ensuring that the terms of your Will are adhered to – i.e. that your wishes are carried out. In the first instance – unless there is good reason to do otherwise – your spouse or partner is probably the obvious option. However, your spouse/partner may predecease you. So, your Will needs to state who your Executor/Trustee is to be in those circumstances. A family member or close friend will often be best. Whoever they are, they need to be competent, honest and preferably located in New Zealand. Restricted Items If you own firearms or other items that require a licence or permit or some sort, you should address this in your Will. Otherwise, the Police will probably end up with them. Gifts Gifts can take a variety of forms: cash, chattels of financial value, chattels of sentimental value, shares, vehicles, real estate or pets. Since most of us have a lot of ‘stuff’, it is best to only address gifts of significant financial or sentimental value in your Will – everything else can be dealt with via a Memorandum of Wishes. Residual Beneficiaries The Residue is what’s left over after all of the estate bills have been paid and the gifts given. In a typical ‘Ma and Pa’ scenario, the residue will usually be distributed to the survivor or (if both Ma and Pa are now deceased) the deceased’s children. If one or more of the deceased’s children are already dead, the usual procedure is to distribute the deceased child’s share between that child’s own children – i.e. the grandchildren. Alternatively, the Will may state that the deceased child’s share is to be divided amongst the surviving children – i.e. their siblings. Ultimately, it’s your assets and belongings and your Will – so it’s up to you. If you need advice, give us a call 03 477 8080.

What would happen if your circumstances changed tomorrow? What would happen if your spouse/partner died tomorrow? What would it mean for you in terms of day-to-day living? Would you be able to do simple things……like buy food? There are many questions you may not know the answer to, but are worth giving some attention to. Your Assets If your spouse or partner dies (before you do), any assets that were not jointly owned by yourself and your spouse/partner – i.e. your name was not on the applicable ownership documents – will immediately form part of the deceased’s estate and so be beyond your immediate reach. These include (but may not be limited to…): Bank accounts Investments Insurance policies Real estate Your Family Home If the family home was not owned jointly by you and your spouse/partner, then if spouse/partner dies before you, the property will not automatically become yours. This can create some or all of the following issues: The insurance company might cancel the House Insurance policy. You may not be able to get insurance with another insurance company. If the family home is not left to you in the deceased’s Will, you could (depending on the facts of your situation) find yourself without a roof over your head. Even if the family home is left to you in the Will, it could be six months or more before it can be legally transferred to you. Paying Bills Do you know how to pay for your utility bills? And do you have authority to speak to your utility providers? If your electricity account doesn’t have your name on it, the electricity company may not be willing to speak with you concerning the account. If you need advice, give us a call 03 477 8080.

The course of our lives can be boiled down to a simple process: decisions followed by consequences – intended or otherwise – followed by more decisions, followed by more consequences. And so on… You consider the question, goal or obstacle that confronts you, you reckon up the information and resources that are available to you in that moment, you make the best decision that you can in that moment……and then you live with the consequences. Sometimes things can seem as though they aren’t working out……but that doesn’t mean that the decision you made was a bad one. It may simply be that the fruition of your plan needs more time than you initially anticipated. And that’s okay – you can adapt, evolve and survive. But never doubt in moments of stress, decisions which made good sense when your thinking was clear. Part of our job is to provide you with sound advice, so that you can make informed decisions. But an equally important part of our job, is supporting you on the journey that inevitably follows those decisions – helping you to adapt and (hopefully) thrive in what can feel like increasingly uncertain times. We help our clients determine whether it’s the right decision to stay the course. If you need a sounding board or advice regarding decisions you’ve made, give us a call 03 477 8080.

When you are appointed as an executor (and trustee) of a will it is important to understand the role. It is an honour to be asked, however the role comes with responsibilities and is time consuming and an unpaid role. As a named executor, you can either accept the position or decline the position. If you decide that you are not willing to perform the role and you have not had any dealings with the will-maker’s property after death, then you may renounce probate. This is done by signing a Renunciation of Probate document. This document is then filed with the High Court. The renunciation of Probate document is also referred to in the affidavit as the remaining executor(s) to explain why all the named executors are not applying for the grant of probate. If you are willing to perform the role as an executor it is important before you agree that you understand what you are agreeing to. ROLE OF THE EXECUTOR IS TO: Locate the original will, contacting their solicitor is usually the best option and conducting a search of their important papers. In the unlikely event that no will is located a solicitor can assist with advertising for a will with the New Zealand Law Society Will Search notices. Contact the Funeral Director for funeral arrangements in accordance with any instructions in the will. The decisions relating to the funeral are up to the executor, however a preference may be put in their will. The executors are guided by those wishes in the will together with the wishes of family. The payment of the funeral expenses has priority and is paid first from the estate. Notify banks, credit card companies and government agencies (e.g. Inland Revenue). We recommend that their bank is advised that the person has died as soon as possible. Although the bank account is frozen pending the grant of Probate the funeral expenses can be requested to be paid directly by the bank to the Funeral Director if the bank is provided with a copy of the funeral invoice and the death certificate (usually certified copies) and the executors approve the invoice for payment. My Trove is a website which allows for executors to notify some banks and government and some insurers that a person has died https://mytrove.co.nz Apply for probate, if this is required. You will usually seek legal advice about whether an application for the grant of Probate is required. This is the application to the High Court of New Zealand. See Estate Guide. The executors and trustees take a neutral position and owe a duty to treat the beneficiaries even-handedly. This duty extends to potential claimants against an estate, where an executor is aware that they may wish to make a claim The executors and trustees need to keep a record of the inventory of the estate assets and liabilities. An account of the estate (estate statements) needs to be recorded that is accurate and states the dates and details of all receipts and disbursements and details relating to the capital and revenue account (for taxation). Once probate is granted, call in the assets and pay all the debts and the funeral and testamentary expenses. Maintain any property until it can be distributed or sold. Have prepared and file the required personal and estate income tax returns and pay any tax owing. Distribute the estate in accordance with the terms of the will. IMPORTANT POINTS Both Powers of Attorney and Enduring Powers of Attorney (Property and Personal Care and Welfare) CEASE ON DEATH. If personal chattels have not been mentioned separately in the will, then those items form part of the residuary estate. If Probate is required, then once Probate is granted, the will which is attached to the Probate document becomes a public document and anyone can request a copy from the High Court of New Zealand, Wellington upon payment of a fee. An executor may receive a request for a copy of a will before Probate is granted or applied for, by a potential beneficiary. We recommend that it would be prudent for the executor to provide a copy of the will in case there is to be a challenge to the will. If the person had a joint bank account(s), the account is not frozen and the bank will be able to transfer the account into the sole name of the surviving account holder once the death certificate is available. If the person had a house, then make sure that the property is insured and if the house is unoccupied that the unoccupied status has been notified to the insurer and this is confirmed in writing to the executor. The insurer will have a number of requirements for unoccupied homes which will need to be complied with. Also, the local council and regional council should be advised of the death and you should check that the rates payments are up to date. If the executor does not apply for Probate within three (3) months of the death then one of the beneficiaries can apply to the High Court to be appointed as Administrator. This is not usual and is a complex process. Executors need to be aware of the “Executors Year”. The time required to administer an estate can vary depending on the circumstances of each estate. We estimate that simple and mid-sized estates usually take between twelve (12) to eighteen (18) months to complete, from the date of the grant of Probate. However, estate administering can take longer depending on the number of assets of the estate and the number of beneficiaries. An executor can be appointed as an executor and also be a beneficiary of the will. If you do not accept the role of executor, this does not affect receiving any inheritance in the will. It is important that executors take legal and accounting advice where necessary. Once Probate is granted, if the estate is modest, the executor(s) and trustee(s) of the estate may prefer to carry out the terms of the will, without the assistance of solicitors, to keep the legal costs to a minimum, seeking legal advice when necessary.

When elderly New Zealanders apply for residential care subsidies, the Ministry of Social Development’s initial letter of response often includes reference to “a Court decision” that “clarified what may be considered asset deprivation”. The Ministry never identifies the case, but it is probably the case of the Chief Executive of the Ministry of Social Development vs Broadbent [2019] NZCA 201. It is true that the Broadbent case clarified what may be considered asset deprivation – particularly where family trusts are concerned. But while the Ministry’s mention of the case in its letters suggests that this clarification benefited the Ministry, in fact precisely the opposite is true. What Broadbent clarified was this: The Ministry cannot simply gross up the value of the assets of a Family Trust… … calculate a notional income from that value… … and then assess your application for a residential care subsidy, as if that notional income was your actual income. Also The Ministry cannot ignore the fact that you have validly forgiven debts owed to you by your Family Trust… …in order to adopt a notional and constant interest rate on that debt… …and then assess your application as if that notional income was your actual income. In short, when assessing your application for a residential care subsidy, the Ministry of Social Development is required to make calculations that are accurate and precise. We can help you to make sure that it does. If you would like to discuss a residential care subsidy application give us a call (03) 477 8080

Emmy Lou Harris once sang that “Neighbours are fun, I love them everyone. We get along in sweet accord”. It’s a lovely sentiment. If not always accurate… Disputes involving people who live in close proximity to one another are difficult. You can’t ignore your neighbour’s unneighbourly antics because they live right next door to you but you are hesitant about confronting them and risking their wrath because……well, they live right next door to you. You can ask us to help. Depending on the precise nature of the issue, we may or may not be able to solve it. But at the very least, we can help you to not make things worse, by taking the heat out of the conversation. Staying calm, objective and on-topic with someone you are not getting along with is sometimes asking a lot. It's where we can help. If you’re dealing with an unneighbourly situation then give us a call (03) 477 8080

When a loved one passes away grief is experienced differently by each family, and members within each family, and administering an estate can be difficult during this time. Our role is to assist the executors in a sensitive and caring way, and to provide you with excellent legal advice. Your first meeting with Lucas & Lucas After a loved one passes, the first step is to meet with the family. Usually this will be at a time shortly after the funeral. During this meeting, we discuss the will and help the executor(s) to consider if Probate is required. Probate is the term used when someone dies leaving a will. The person(s) named in the will as the executor(s) apply to the High Court to have the will declared valid and to administer the estate. Probate gives the person(s) the authority to manage the estate. Probate is required if there is, with any one bank or investment institution, more than $15,000 or if land is in their sole name or as tenants in common. If in the unlikely event there is no will, we discuss the options available and whether Letters of Administration may be required. Probate To obtain probate, we prepare for completion by the executor(s) an affidavit for grant of Probate (with the original will as an exhibit). The affidavit can be completed at our first meeting. We then arrange for the affidavit together with an Application and the draft Probate (court order) to be file in the High Court of New Zealand at Wellington. The filing fee is $200. This is filed with the High Court by courier. The court will consider the application and this takes usually between two to six weeks for the probate to be granted after this is filed. Confirm assets and liabilities of the estate We can assist with confirming the assets and liabilities of the estate. If the person owns jointly (joint tenants) a home, this asset would NOT form part of the estate, but we assist with the legal paper work for this to be transferred to the surviving owner (known as transmission by survivorship). If the person has joint bank accounts and/or investments then again these accounts would NOT form part of the estate and we can assist with the legal paper work to advise the bank or financial institution to have these transferred by survivorship. The remaining assets in the sole name of the person would then form the estate assets. These can include any car, bank accounts, term deposits, KiwiSaver, shares, investments, real estate and other valuable items, such as collectables. As required, we can assist the executor(s) to contact the organisations, close the bank accounts and investments, sell or transfer property and other assets and assist with the legal paper work. in advising the banks and financial institutions that the person has died. This then freezes the accounts/investments until probate is granted. to understand and comply with the IRD tax requirements for the estate. The tax rate for estate income is 33%. Each estate is required to apply for an estate IRD tax number and file tax returns. The IRD estate link is https://www.ird.govt.nz/situations/im-looking-after-the-affairs-of-someone-who-has-died How long will it take? The time required to administer an estate varies depending on the circumstances of each estate. We estimate that simple and mid-sized estates usually take between twelve (12) to eighteen (18) months to complete, from the date of the grant of Probate. The length of time for estate administering varies depending on the number of assets of the estate and the number of beneficiaries. Some more complex estates can take significantly longer. We like to set realistic time frames. Where a will is challenged by a family member or there are complex assets, such as overseas property, administration may take longer. We have excellent relationships with solicitors in Australia, the United Kingdom and Canada to assist with any the administering any assets in these countries. Customer Due Diligence Please do not be offended when we request verification of identification and address. In practical terms we require proof of identification to verify full names, dates of birth and confirmation of residential address. This applies both to the executor(s) and to all the beneficiaries of the estate. All banks, financial institutions, stock brokers, lawyers and accountants are required to verify this information. The Anti-Money Laundering and Countering Financing of Terrorisms Act 2009 has placed increased emphasis on customer due diligence. We are experienced in collecting this information to streamline the administration process for the estates which we assist with the administration. For further information contact us or call (03) 477 8080

Stress is what we might feel when trying to process more information than we normally would. Sometimes this can come in the form of a singularly large problem, but more often it involves being overwhelmed by wave upon wave of smaller problems. When you have skin in the game, it is virtually impossible to step back from the storm and assess it dispassionately. This is where we can help. Our job is not simply to magic up some paperwork and say “Sign here”. Rather, our job often involves saying: “Yes, this wheel is squeaking pretty loudly, but that’s ok – it just needs some oil. And all those balls you’re juggling? We can take those three off your hands right now. And as for the rest, we’ll help you sort those too”. When you have a lot going on, acquiring and maintaining a sense of perspective is key……though that can be much easier said than done. If you’re dealing with a number of balls in the air, and need a sounding board, then give us a call (03) 477 8080