Probate is probate…isn’t it? Well, sort of.
What is probate?
Probate broadly refers to a Court process in which a will is ‘proved’ – which makes sense, given the similar origin of the words ‘prove’ and ‘probate’.
A grant of probate is made by a court:
(a) to named person(s);
(b) in respect of a particular will.
By granting probate, a court is in effect pronouncing:
(a) that the named person(s) can deal with the deceased’s property; and,
(b) that the deceased person’s property can be distributed according to the ‘proved’ will.
While probate can be considered to be much the same as any other final Court order, it does, even to this day, comes with some distinctively longstanding trappings - wax-like seals, annexed wills, etc. The grant of probate has a function similar to that performed, in other contexts, by notarised documents. It has been said that ‘…a grant of probate or administration serves, in practical reality, as an instrument of title’.[1]
Third-party protections
Part of probate’s practical role is to provide protections to third-parties, such as banks, who may otherwise face potential liability for unauthorised dealings with a deceased person’s property. For this reason, banks usually require evidence of a grant of probate before releasing any funds held in a deceased person’s accounts. Land dealings attract much the same considerations.
So, probate is important – but it is still just probate, isn’t it?
Probate in common form and probate in solemn form
Not quite, because probate in NSW is customarily granted and described under two different labels: probate in common form and probate in solemn form. So, what is that about?
Probate in common form
Probate in common form is the 'standard' type of probate granted in NSW. It involves a relatively simple and straightforward administrative process that does not require any public court hearing. Instead, it is obtained by filing an application (with supporting material) to be considered 'on the papers' by the Registry of the Supreme Court of NSW.
Once an application has been filed, a Registrar of the Court reviews the material and, if satisfied, will grant probate -and this what is typically described as a grant in common form. This means that the Court, by this administrative process, recognises the validity of the will submitted as the deceased person’s last will, and, by granting probate, confers on the applicant(s) (and others dealing with the applicant) certain protections in carrying out its terms. A red waxy seal is affixed, and the executor can (armed, in effect, with Court-certified authority) take control of the deceased's assets so as ultimately to make a distribution to the beneficiaries named in the probated will.
Probate in solemn form
Probate in solemn form involves a more rigorous ‘proving’ of a will than probate in common form, requiring (among other things) a public Court hearing before a judicial officer. This process is used in situations where there is a dispute or significant question as to the validity of a purported last will. For instance, this may arise when someone believes on adequate grounds that the deceased did not have capacity to make a will, or did not know and approve the contents of the document.
It is worth noting that obtaining a grant of probate in solemn form will inevitably be a more complex, costly and time-consuming task than obtaining a grant of probate in common form. It can take many months and even years to resolve a probate dispute in Court.
Differences
Probate in common form and probate in solemn form are not mutually exclusive, or 'binary'. It is well established that a grant of probate in common form can be revoked and that a grant of probate in solemn form can be made in its place – even where this involves the same will, and the same applicant for probate. This is something of a belt and braces approach, which may be appropriate, for instance, where an issue of sufficient significance surfaces only after probate in common form has been obtained. See the reasons in The Estate of Alberto Magri (No 2)[2] for an example of where this has occurred.
One of the main reasons for pursuing a grant of probate in solemn form, despite the additional delay, cost and complexity associated with the process, is to quell with some finality a controversy about a will or wills between two or more interested parties.
The concept of finality referred to here is largely the same as in any other Court contest involving a final public hearing and determination. That is, when there is a contest or dispute between parties as to some aspect of their legal position, the Court system is the ultimate legitimate umpire of that dispute. Court orders made at the end of a final hearing are meant to resolve the legally-material issues in dispute, so far may really be needed, once and for all.
Having said that, grants of probate, even in solemn form, are susceptible to being
revoked and are in this way a bit different to other final court orders. Some
categories of case in which grants of probate in solemn form have been revoked include where a later will is only discovered after the process has occurred, and where parties with a proper interest in the estate were not given an opportunity to participate in the Court process because they were not on notice of this.
As such, the relative ‘finality’ of a grant of probate, even in solemn form, might at times prove to be more illusory than real.
What about those protections?
In any situation where the probate rug might suddenly be pulled out from under those dealing with, or interested in, an estate, significant issues can arise. If an estate has, for instance, been wholly or partly realised and distributed by what turns out to be the ‘wrong person’ in accordance with the ‘wrong will’, then those with different entitlements under the ‘right will’ may be left substantially prejudiced.
This can be one of those difficult situations in which the law needs to allocate loss between, or allow it to rest with, various parties who have ended up in a certain position through no conceivable fault of their own.
In NSW, the Probate and Administration Act 1898 (NSW) contains a range of provisions designed to protect the position of persons (both executors and third-parties) who, broadly, have acted in good faith in reliance on a grant of probate that is subsequently revoked.[3] These provisions also operate to preserve the validity of transfers of money and property previously effected – but leave open the possibility that the value of such assets (though title may have validly passed) can be ‘traced’ into third-party hands.
Leaving any detailed discussion of tracing to another day, the general position achieved by these provisions, meshed with the general law, will be to leave any loss resulting from good faith dealings wherever it may have fallen up to the point that a grant of probate is notified as revoked. Of course, if those involved in prior dealings knew or suspected something to be wrong, then the position may be quite different, and any aggrieved beneficiaries may well have significant remedies available to them.
Both grants of probate in common form and grants of probate in solemn form attract the operation of these protective provisions of the Probate and Administration Act 1898 (NSW).
The last word?
What may seem to be the last word on a grant of probate can quickly be displaced by a further last word (or even a further further last word...) as interested parties’ (and the Court’s) state of knowledge unfolds. The coming to light of matters such as an unknown will, or an unknowing party, can radically change things.
A grant of probate, in the meantime, nonetheless serves an important and useful function. For the vast bulk of estates, a grant of probate in common form will not only be an adequate option, but also the only appropriate one. Third parties acting in good faith need look no further than the grant itself.
For those more closely connected with an estate (as either competing controllers, or competing beneficiaries), active involvement in proceedings for a grant of probate in solemn form may be a necessary but lengthy, costly and stressful process to resolve serious doubts or disputes concerning a will or competing wills.
Of course, in NSW, the adequacy of the provision made under a completely ‘proved’ will can still be the subject of a different kind of legal challenge under Chapter 3 of the Succession Act 2006 (NSW). Such ‘family provision’ claims might in fact prove to be the last word in the distribution of an estate, regardless of what a fully ‘proved’ will may have to say on the topic. Again, a discussion for another day.
Comments