The Tasmanian Law Reform Institute has released a paper to close a loophole regarding estate laws of claims from families who have lost a loved one.
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The institute reviewed whether non-estate assets should be available to fund successful claims against a deceased person's estate.
Non-estate assets include joint-tenancy properties, superannuation, life insurance proceeds and trust assets.
In all states, besides New South Wales, only assets that are part of the deceased’s estate can be used to fund a successful claim.
These assets must be solely owned by the deceased person.
New South Wales legislation allows a court to deem assets that are not part of a person’s estate as being part of their "notional estate".
In Tasmania, claims can be made against a spouse or parent's estate by family who considered they were not properly provided for.
The paper's author Kate Hanslow said a person who was considered wealthy could die without anything of substance in their estate.
"This has the effect of excluding assets from the reach of a challenge, and in some cases, it can mean that family members are unable to proceed with family provision claims because there is no estate to claim," she said.
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Nina Hendy sparked the review, ordered by former Attorney-General Vanessa Goodwin.
This was after she failed to receive an inheritance from her father, a prominent Launceston businessman, when he died from brain cancer in 2015. “My dad's estate was completely stripped in the couple of months before he died - he was a very wealthy Tasmanian businessman," Ms Hendy said.
“However this happened, it shouldn't have.
"Someone's estate should not be emptied when they're at the end of their life; locking family out of an inheritance.
“Lawyers told us there was nothing they could do. The estate was empty, meaning my dad died worth virtually nothing.
"Even the will he signed a month before he died could not be enacted as there was not enough funds in the estate."
She said she hoped no other family would have to endure this experience.
Estate planning lawyer Kimberley Martin said decisions on how estates should be carved up where often complicated by blended families and the need to balance claims between spouses and children from previous relationships.
“Introduction of notional estate laws will almost certainly lead to more litigation involving deceased estates and the complexity of these laws will inevitably increase legal costs for the parties involved," she said. The institute is seeking public feedback to the issues paper up until May 24.
