A shocking story about a relationship between a Victorian magistrate and his junior court clerk has highlighted the need for people to seriously look at their superannuation death benefits and their overall estate planning regardless of their age.
Magistrate Rodney Higgins and Ashleigh Petrie, 45 years his junior, began a relationship in 2019. The multi-decade age gap sparked frenzied media coverage at the time.
Mr Higgins, then 68, and Ms Petrie were a couple for seven months and lived together for about four months prior to Ms Petrie’s tragic death in a car accident in October 2019. The couple were engaged in September 2019.
During her relationship with Mr Higgins, Ms Petrie had nominated her mother as the beneficiary of her superannuation and life insurance. But following her death, Mr Higgins successfully claimed her $180,000 superannuation death benefit.
Mr Higgins, who earns $324,000 a year as a magistrate in Bendigo, made the successful claim on the death benefits of his late fiance after the fund agreed with his argument that he was her de facto partner and therefore her ‘dependant’.
Mr Higgins refused the mother’s pleas to share the money.
Within months of the young woman’s death, Mr Higgins returned to his partner of 18 years, Lurline Le Neuf, who he had left earlier that year to be with Ms Petrie.
Meyer Vandenberg Lawyers partner Tanya Herbertson says superannuation death benefit disputes are becoming increasingly common.
“These days, people are living longer and sometimes having more relationships during their lifetime, and blended family situations are common,” she says.
“Quite often the sums involved in superannuation death benefit disputes are significant, particularly when there is also a life insurance component. The significant money at play can, in part, drive the motivation behind such dispute.”
Superannuation fund members can make a binding or non-binding nomination of who they wish to inherit their benefits when they die, but a fund can override a member’s nomination if it does not comply with the Superannuation Industry (Supervision) Act 1993, the federal legislation governing superannuation.
Under the Act, a nominated beneficiary must be a ‘dependant’. This includes a spouse. A de facto partner qualifies as a spouse, but the Act does not specify how long a couple must co-habit to be considered de facto.
Lawyers had argued that the mother was Ms Petrie’s ‘dependant’, with cash transfers being made from daughter to mother for dinners, groceries and clothes.
The payout has now been delayed as lawyers for Ms Petrie’s mother have appealed the super fund’s position to the Australian Financial Complaints Authority.
“That’s why it’s important to get advice from a lawyer who specialises in estate planning,” she says.
“Any law firm can write you a will, but what you want is comprehensive estate planning advice that is personal to you and to your circumstances, and which takes into proper account all your assets, including your superannuation death benefits.”
An estate plan will typically involve not just a will, but also an enduring power of attorney and a binding death benefit nomination to deal with your superannuation so it ends up with the person or people you want to benefit.“It is dangerous to believe you can just tick a box on a form regarding your superannuation and that will guarantee where the money will go,” says Tanya. “There are legal requirements that must be met to ensure your binding death benefit nomination is valid.”
If the nomination you make is not valid then the superannuation trustee will have discretion as to who they pay the death benefit to. That often means a person who does not know you or your family is making a decision as to who gets the money, often by forming views about the nature and status of relationships.
Tanya says she has seen cases where the trustee is making decisions about whether or not there was a genuine spousal relationship, and how much various family members should receive when competing claims have been lodged.
“The process is often not very transparent, with no right of the parties involved to see what evidence is being submitted to the trustee by claimants,” she says. “There are rights of appeal, however the appeal process is typically a long one and can be expensive.”
For more information, visit Meyer Vandenberg Lawyers.
Original Article published by Karyn Starmer on The RiotACT.