We are seeing a growing number of disputes between siblings, and sometimes even parents, over companies, trusts, family businesses and inheritances.
These conflicts are rarely just about money. They are deeply personal, emotionally charged and often tied to long standing family dynamics and unspoken expectations.
Common themes
The common themes in these disputes are:
- they often occur after the death of one or both parents;
- they relate to assets outside of the deceased estate (often involving trusts and businesses); and
- one or more of the siblings have worked in the business and feel a sense of entitlement to more than the others when it comes to distribution of the proceeds of the trust or business or feel that the split is not “fair”.
Why do these disputes often not settle quickly?
These cases often settle, however not without lengthy litigation, significant legal costs, stress and a complete breakdown in the relationship between the parties.
Notwithstanding the parties being provided good advice to settle upfront before spending years in litigation, often one or more of the parties is unwilling to listen to the advice as the dispute is deeply personal and the parties do not approach the dispute with a commercial mindset.
How can you minimise the risk of years of litigation?
- Good Advice.
Good advice is invaluable.
People always tell us that their affairs are simple and that they do not see the benefit in spending time and money on getting advice on more than a basic will.
If you have companies or trusts you need to carefully plan what is to happen and how it will happen when you are not around to control it. The assets controlled by these entities do not fall within the deceased estate.
Good advice upfront minimises the risks of years of expensive litigation diminishing the overall return for everyone.
2. Settle early.
If possible attempt to settle early.
Litigation is expensive and if there is a dispute, all parties are usually better off settling early than spending a significant proportion of the wealth on legal fees.
Lessons
Disputes amongst family members are difficult and oftentimes involve complex laws regarding trusts and companies.
You need experienced lawyers to provide good advice to maximise your chance of a good outcome.
Catherine Ballantyne, Principal, is very experienced in these matters and can be contacted on (03) 9242 4766 and catherine.ballantyne@madgwicks.com.au
The information provided in this article is general in nature and cannot be relied on as legal advice, nor does it create an engagement. Please contact one our lawyers listed above for advice about your specific situation.
