How separation can impact your estate planning: Part 1 – Married couples in Queensland

February 3, 2022

For many people, updating their estate planning documents is the last thing on their mind as they navigate separation, negotiate a property settlement and co-parent their children.  But we regularly see how failing to update estate planning documents after a separation can mean your property is not dealt with as you would now wish.

How your estate planning documents are affected by your separation depends on whether you were married or in a de facto relationship, and whether you reside in Queensland or NSW.  In the first of this 5-part series, we outline the rules for married couples in Queensland.

Estate planning documents in Queensland

An Enduring Power of Attorney (EPOA) is a document which appoints other individuals to make decisions (both financial, legal and/or health) if you lose capacity and are legally incapable of making decisions on your own behalf.  This document and your will are your key estate planning documents.

People will often appoint their spouse as an attorney (in their EPOA), and as an executor and/or beneficiary (in their will).   So what happens if you separate from your spouse and no longer want them to act on your behalf (in the event you lose or capacity) or inherit your property (in the event you die)?

If you are separated but not yet divorced

Remember that before you can apply for a divorce order from the Federal Circuit and Family Court of Australia, you and your spouse must have been separated for 12 months.

Until your divorce is finalised (i.e. a divorce order has been issued by the Court), your EPOA continues to be valid.  This means that if you had previously appointed your spouse as your attorney, they will continue to have the power to make decisions on your behalf (if you lose capacity) until you get divorced unless you amend your EPOA to remove your spouse as attorney.

Until your divorce is finalised, your will also remains valid.  As such, it is important that you update your will as soon as you separate, so that your asset are left to your children and/or other family members (or whomever you wish it to go to).  You can always make a further will down the track, once you have finalised your property settlement and have some certainty around your assets.

Once your divorce is finalised

Your EPOA is revoked to the extent that you had provided your former spouse with power to act on your behalf in making decisions regarding your health and/or legal/ financial affairs.

Any provision in your will which appoints your former spouse as executor, trustee and/or guardian, or any provision which gifts property, cash or items to your former spouse is revoked.

What if you die without a will whilst married (but separated)?

If you live in Queensland, die without a will, and are married at the time of your death (even if you are separated from your spouse) then the rules of intestacy provide that your estate is split between your spouse and children (if you have them) as follows:

1. 100% to your spouse if you do not have children;
2. If you have one child, the first $150,000 of your estate plus household items goes to your spouse and the remainder your estate is split equally between your spouse and child; or
3. If you have more than one child, the first $150,000 of your estate plus household items goes to your spouse and the remainder your estate is split 1/3 to your spouse and the remaining 2/3 distributed equally amongst your children.

Yet another reminder why updating your will and EPOA should be a number one priority as soon as you have separated!   To discuss further, please contact our estate planning team.

Look out for our next bulletin where we discuss the rules for married couples in NSW which are in contrast to the rules in Queensland.