When your legal documents need to work together
Often the important part of estate planning is making sure the different legal documents you have in place work together.
When people enter into a Contracting Out Agreement under the Property (Relationships) Act, their usual focus is on what will happen if they separate. But these agreements can also deal with what happens to relationship property when one partner dies.
This makes it important to consider the agreement alongside your Will. If the two documents do not align, the outcome may not be what you intended.
When the details matter
A client had previously entered into a Contracting Out Agreement, which provided that their surviving partner would receive a life interest in the family home on death.
However, the client's existing Will had been prepared before the agreement was entered into and did not provide for the interest set out in the agreement.
A new Will was therefore prepared to include the life interest and ensure it matched the terms of the agreement.
While this may seem like a straightforward update, making sure the Will and Contracting Out Agreement align is important. Without updating the Will, there could be uncertainty about how the client's wishes under the Will and obligations under the agreement would be dealt with after their death.
Your agreement and Will should work together
A Contracting Out Agreement should set out how relationship property will be dealt with if a relationship ends, either by separation or death. However, having an agreement in place does not mean your Will no longer matters.
In fact, the two documents can work together in different ways.
For example, a person may enter into an agreement that keeps all property separate, while their Will provides for that partner more generously by gifting some separate property on death. The Will can still provide those additional benefits, provided they are consistent with the agreement.
The same issue can arise when circumstances change.
It is not uncommon for someone to enter into a separation agreement to divide relationship property but leave an earlier Will unchanged. Unless the parties have divorced, gifts provided to a former partner under that Will generally remain in place.
This means someone could have formally concluded the division of their relationship property but still have an outdated Will that leaves a significant benefit to their former partner.
Why the bigger picture matters
This example shows why we don't look at legal documents in isolation. A Contracting Out Agreement affects more than just relationship property. It can also affect other documents, including your Will.
If you have recently entered into a relationship property agreement, or your circumstances have changed since your Will was prepared, our family team can help make sure your documents still work together.
Disclaimer
This article provides general information only and does not constitute legal advice. You should seek legal advice specific to your circumstances before acting on this information.