Estate Planning - Appointing a guardian in a will

Appointing a guardian for your children in your Will

Parents of young children lead busy lives, and preparing a Will can be a confronting exercise. As such, estate planning tends to be avoided or put on the back burner, sometimes until ‘the kids are older’.

However, whilst children are still young it is important to think about who will look after them in the event of the death of one or both parents. This role is known as the Guardian, and typically is one of the hardest decisions parents with young children have to make when preparing their Wills.

What is a Legal Guardian?

With regards to estate planning, a legal guardian is an adult who has been elected to care for a child in the event one or both parents die before that child reaches adulthood. The Guardian will be the child’s primary carer until they turn 18, and will be responsible for their wellbeing, maintenance and development generally. As this person will take on a major responsibility, it is critical that parents have considered the significant influence they will have on their child’s upbringing and have selected someone who is willing and able to take on the role.

Why you should name a Guardian in Your Will

Though it may be difficult to plan for events that are out of our control, preparing a Will ensures that the your wishes regarding your child or children are documented. In doing so, your loved ones are left with direction in how to manage your legal affairs and your intentions are made known.

In the event of the death of both parents, any person with a sufficient interest can apply for the guardianship of minor children if there are no specific instructions in a Will. It is then left to the Family Court to assess and determine who should become the legal guardian of the child based on the best interests of the child. This is not an ideal contingency plan as the Family Court may not choose the guardian who the deceased parents would have chosen, making an already devastating time even more disruptive and costly.

The situation is more complicated if one parent dies, especially for couples who have separated or divorced. Whether or not the surviving parent or the guardian appointed under a Will receives custody of the child depends on a number of factors, including the terms of any parenting orders made or agreed to by the parents.

However, by appointing a legal guardian under a Will, the guardian is entitled to be a part of any proceedings in determining the guardianship of the child, including challenging any parenting order already made. In providing for a guardian, the wishes of the deceased parent are met in relation to the guardianship of their child after their death.

How do you decide who should be your child’s guardian?

Appointing a legal guardian is a very personal decision and one which requires careful consideration. Although no one can love a child like a parent, a guardian who shares closely aligned personal and lifestyle values can provide a child with a supportive and loving home in the event of the unexpected. To help choose this person, the following factors should be considered:

  • Location: Do they live in the same area? If so, this will enable the child remain at the same school and maintain their friendships.
  • Age: Although grandparents may have a special bond with their grandchildren, they may not be at a stage where they can take on the full time emotional, financial and physical responsibilities of raising a young child.
  • Financial stability: Is the guardian financially stable? Will their house accommodate more children? What is the nature of their work and working hours?
  • Personal values: Does the guardian share similar moral values, religious beliefs and views on child raising?
  • Family situation: It is possible to appoint co-guardians but it is generally recommended that an individual is selected instead to avoid potential future complications such as divorce. Does the guardian have children of their own? How old are these children and what is their relationship with your child? Is the guardian considering having more children?
  • Alternative appointment: It is important to note an appointed guardian is not legally obligated to take on the responsibility of guardianship so it is also recommended that another guardian is chosen should this situation arise.

Can the guardian access the child’s share of the estate?

Apart from the selection and appointment of a guardian, it is also necessary to consider the guardian’s access to the child’s share of the estate.

A guardian is responsible for the maintenance and development of a child. However, a Trustee of a deceased estate is responsible for the administration and distribution of the estate assets. Although, it is possible to appoint the same person to both roles, in certain circumstances it is recommended that different individuals are appointed in each role to avoid potential misconduct or conflict of interest.

Generally, the guardian is given access to the child’s share of an estate, and can use this money for the child’s welfare, at the discretion of the trustee who is responsible for distributing capital from the estate in accordance with the the terms of the parents’ Will.

Further Considerations

Any other consideration that a parent would want known to the guardian of their child can be documented in a Memorandum of Wishes, which is a non-binding ‘letter’ that doesn’t form part of their Will, but can be used as a guide to the guardians in relation to the raising of the child.

Though any number of topics can be included in a Memorandum of Wishes, some factors typically referred by parents with a young child include:

  1. The hobbies, interests and disinterests of the child.
  2. The values you would like to be instilled or preserved in the child.
  3. The child’s friends.
  4. Skills the child shows potential in.

As with all estate planning matters, it is important for a parent to discuss these fundamental decisions with their spouse and family, and to review their Will and choice of legal guardian following any major life event.

If you have a young child, no matter your circumstances, having a Will is essential to document your intentions in relation to the guardianship of your child and ensures that your voice can be heard through your appointed guardian regarding your child’s development after your death.

Please contact us for a complimentary consultation to discuss your estate plan or review your existing Will. 

John Olsen

Estate Planning to protect against elder abuse

The recent decision of prominent Australian artist John Olsen to launch legal proceedings against his stepdaughter, Karen Mentink, for her actions immediately prior to

wife’s death has attracted media attention. This matter is an example of nature of elder abuse, its devastating impact on families and the importance of proper Estate Planning as a means of protection against elder abuse.

Mr Olsen claims in the month before his wife’s death, Ms Mentink exerted undue influence over her mother Katherine Olsen. This caused Mrs Olsen to rewrite her Will and make Ms. Mentink  a signatory on all of her late mother’s bank accounts, enabling her to transfer $2.17 million to herself from the couple’s joint account.

The Olsen’s 27 year marriage was devastated in 2016 by Mrs Olsen’s dramatic personality change as a result of two brain tumours. Although the tumours were removed in June of that year, by October Mrs Olsen was given a terminal diagnosis and remained in a vulnerable state, suffering from what Mr Olsen described as “cognitive impairment”. In the days immediately following her diagnosis, Mrs Olsen was driven to the bank by her daughter and made out the first of several cheques which Ms Mentink purports were ‘gifts’.

The validity of these withdrawals and other matters are now in question before the NSW Supreme Court. Ms Mentink denies her mother was cognitively impaired at the time.

Questions this matter raises
The dramatic facts of this case and the relationship ending allegations of undue influence, duress and unconscionable conduct between family members reflect the devastating nature of elder abuse and the complexity of estate litigation. As an estate lawyer, I have been involved in a number of such cases where families are bitterly divided and emotionally charged whilst grieving the loss of a loved one. The emotions behind such sensitive matters requires the legal representatives of families in dispute to ensure their client remains rational, level headed and strategic when telling their ‘side of the story’.

Reading the media coverage of this case, I immediately had several questions that I had previously asked in the context of Estate matters I have been involved in: 

  1. Who was Mrs Olsen’s guardian or administrator?
  2. Did Mrs Olsen have a valid Power of Attorney appointing a financial attorney?
  3. Were the transfers effected during Mrs Olsen’s lifetime performed by someone in their capacity as Mrs Olsen’s administrator or financial attorney, or in their capacity as a signatory to the account?
  4. What are the duties and obligations of an account signatory to the actual account holder?
  5. How was Ms Mentink able to be added as a signatory to the bank accounts? Is the bank liable for allowing signatories to be added?
  6. In what circumstances was Mrs Olsen’s new Will made? Do the lawyer’s file notes indicate that assessments of her capacity were made?
  7. If the Will is valid, can Mr Olsen challenge Mrs Olsen’s estate? Is there possibly a better suited claimant?
The crux of the case lies with Mrs Olsen’s capacity following her brain surgery in June 2016. Her capacity to enter into transactions and make a new Will is assessed as a legal test informed by medical evidence, and strictly speaking not the other way round. One’s cognitive ability and coherence inevitably can change from time to time, regardless of any ailments or medical conditions. Therefore, in line with respecting the autonomy of the individual, one’s capacity must be carefully assessed at the relevant time they make a decision rather than classifying them as lacking capacity and agency when making any financial, medical or significant personal decision.

What can be done to protect against these sorts of issues?
Of course hindsight makes this approach clearer and whilst no solution is perfect, there are several steps which can be taken to ensure one’s Estate Plan can protect them from elder abuse and avoid family conflict of this kind. For example:

  1. Consider having effective and comprehensive Financial Powers of Attorney that require multiple attorneys (or agents) to act on your behalf, who can jointly make or execute financial decisions.
  2. If a loved one is susceptible to elder abuse on account of diminished capacity, consider acting quickly to appoint a guardian(s) or administrator(s) and even consider seeking out someone independent to take on this role.
  3. If you are considering making a will, do not delay it because your personal, health and financial circumstances may change at a later date, which may raise doubt the validity of your Will and final wishes.
  4. Consider whether or not a contract to make mutual Wills is an appropriate and effective mechanism.
More conversation needs to be had about the devastating impact of elder abuse in the community and the State government’s role in ensuring greater protections exist to prevent it occurring.

In the meantime, there are steps that can be taken and measures which can be put in place in an individual’s Estate Plan. Formalizing your Estate Plan whilst you are still able should not be delayed or taken lightly, as no doubt the Olsen family are unfortunately now realising.