Guide to Letters of Administration in NSW

Introduction to Letters of Administration

What is ‘Letters of Administration’?

A Grant of Letters of Administration is required where someone has passed away without leaving a Will. This is known as ‘dying intestate’.

Letters of Administration is the approval granted to the deceased’s closest living next of kin (the Administrator) by the Supreme Court, allowing the Administrator to administer the deceased’s estate in accordance with the laws of intestacy. The laws of intestacy in each State set out who can apply for a Grant of Letters of Administration, and who inherits the estate, where there is no Will.

If the deceased left a Will, then the correct application would be for a Grant of Probate, rather than Letters of Administration.

Who can apply for Letters of Administration?

In New South Wales, to apply for a Grant of Letters of Administration you must be the deceased’s most of kin (i.e. their closest living relative). The hierarchy of next of kin, who are eligible to apply for a Grant of Letters of Administration, is identified in the following order:

• The deceased’s spouse (husband, wife or de-facto partner with whom the deceased has been in a relationship with for at least two years or which resulted in the birth of a child, so long as there are no children of the deceased’s from another relationship);
• The deceased’s spouse/de-facto partner and children (if there are children of the deceased’s from another relationship);
• The deceased’s children (including any grandchildren, if one of the deceased’s children has predeceased the deceased);
• The deceased’s parents;
• The deceased’s siblings (including any nieces and nephews, if one of the deceased’s siblings has predeceased the deceased);
• The deceased’s grandparents; or
• The deceased’s uncles and aunts (including any cousins, if one of the deceased’s aunts and uncles has predeceased the deceased)

Each category of next of kin must be exhausted before moving to the next level of the hierarchy.

Why do I need Letters of Administration?

In most cases, without a Grant of Letters of Administration, the deceased’s next of kin will be prevented from accessing and managing the assets of the estate (i.e. bank accounts, share accounts, property and other assets).

Occasionally, the deceased’s next of kin will not require Letters of Administration to access and distribute the estate’s assets, but a Grant is normally required. Letters of Administration may not be required in the following situations:

• All assets owned by the deceased were held as joint tenants (also known as joint proprietors)
• The estate has minimal assets (this depends on the organisation, and is usually considered on a case-by-case basis)
• If there is a Will (if this is the case, a Grant of Probate would be required)

What is my role as Administrator?

If you are the deceased’s next of kin and are applying for a Grant of Letters of Administration, you should be prepared to take on significant responsibilities in relation to dealing with the estate.

It is the Administrator’s responsibility to administer the estate. If there is more than one eligible next of kin, then all eligible next of kin should apply to be appointed as Administrators. If an eligible next of kin does not wish to apply, they will need to provide their written consent to the other eligible next of kin allowing them to apply without them.

As an Administrator, you will generally be required to:

• Organise and carry out funeral arrangements
• Obtain a death certificate
• Identify all eligible beneficiaries entitled to inherit pursuant to the laws of intestacy in NSW
• Notify utility providers and financial institutions of the death
• Redirect post and contact financial institutions to put a halt on any direct debits
• Find and contact beneficiaries, and keep them updated on the estate administration process
• Contact financial institutions, service providers and government agencies to validate the deceased’s assets and liabilities
• Create an inventory of the estate including cash, real estate and securities, insurance policies, superannuation, outstanding work entitlements and any personal and household effects
• Keep records of any financial and administrative transactions incurred during the estate administration process
• Provide a distribution report to each beneficiary
• Gather important documents and fill out the paperwork to apply for a Grant of Letters of Administration with the Supreme Court
• Pay off any debts, taxes and other expenses incurred for burial or funeral arrangements
• Distribute the remainder of the estate to beneficiaries including paying legacies, establishing testamentary trusts, and bequeathing gifts or donations
• Prepare account and tax information for beneficiaries after Letters of Administration is granted

You can review a detailed list of tasks traditionally required of an executor by downloading our complimentary Executor Checklist.

Do I need a lawyer to apply for a grant?

There is no requirement that you use a lawyer to apply for Letters of Administration, and there are online resources that can help guide you through the process.

Most people, however, choose to use a lawyer because it is a technical legal process that can be complex, and if not done correctly could result in personal liability for the Administrator. Because of this, it is generally recommended to engage a lawyer for advice.

As part of preparing and lodging a Letters of Administration application, you will be required to swear or affirm an Affidavit and may require certified copies of documents. These are services that most lawyers offer as part of their Letters of Administration service and can help make the process of applying for Letters of Administration less complicated.

What if there is a Will?

If there is a Will, you may still need to apply to the Supreme Court for authority to deal with a deceased person’s assets. If you have located a Will made by the deceased, then you will be required to apply for a Grant of Probate, rather than a Grant of Letters of Administration.

Please visit our NSW Guide to Probate to find out more about the process of applying for Probate.

Steps required for Letters of Administration

The process of obtaining Letters of Administration requires the deceased’s closest living next of kin to make an application with the NSW Supreme Court, and generally involves publishing an online notice and lodging a set of documents with the Court. The Court will review the documents and if all the information has been correctly prepared, the Court will make a Grant of Letters of Administration.

Locate important documents and information

As explained above, it is the Administrator’s role to obtain a death certificate, and contact financial institutions, service providers and government agencies to validate the deceased’s assets and liabilities.

These documents and important pieces of information will all be required for the Letters of Administration application. You should not lodge a Notice of Intended Application until you are in possession of the original death certificate.

As part of applying for Letters of Administration, you will be required to identify all eligible beneficiaries of the estate pursuant to the laws of intestacy in NSW. As part of this, you may require copies of death certificates for any beneficiaries who have predeceased the deceased, and/or birth certificates for any surviving children of beneficiaries who have predeceased the deceased.

Lodge a Notice of Intended Application

A Notice of Intended Application publicises your intention to apply for a Grant of Letters of Administration on the basis that you are the deceased’s closest living next of kin. It also provides any creditors of the deceased with an opportunity to make their claims on the estate known to the Administrator. The Notice is published on the NSW Online Courts and Tribunals Registry website. The fee for publishing the Notice is $49.00 (as at time of publication). You will need to make an account, enter all required information and provide your credit card details to pay for the Notice online, if you are publishing it yourself. The relevant legislation requires that the Notice be published at least fourteen (14) days before an application for a Grant of Letters of Administration is made by the Administrator.

Identify assets and liabilities

As explained above, it is the Administrator’s responsibility to create an inventory of the estate including cash, real estate and securities, insurance policies, superannuation, outstanding work entitlements and any personal and household effects.

This information is required for the Letters of Administration application and can take some time to collate. In NSW, the Inventory (UCPR Form 117) must contain details of all assets the deceased held either solely, as joint tenants and/or as tenants in common.

Here are some examples of the details required for different types of assets you may come across:

• Real estate – Address, Certificate of Title Folio Identifiers, and value as at date of death
• Bank accounts – Bank name, branch, BSB, account number(s) and value as at date of death
• Shares – Name of company, name of share registry, number of shares held at date of death and value as at date of death

The Affidavit of Administrator (UCPR Form 119) requires you to list all liabilities held in the sole name of the deceased as at the date of death. You do not need to include jointly held liabilities (such as a home loan or mortgage held jointly with a spouse or de facto partner). To prepare the Affidavit of Administrator, you must identify:

• The date each liability was incurred
• Name of the creditor (whether it be a person or company)
• The value of the liability as at the date of death

Estate expenses, such as funeral and burial costs, are not considered liabilities of the deceased as they were incurred after death. These types of liabilities do not need to be included in the Affidavit of Administrator.

Court application

Required forms

The forms required for a standard Letters of Administration application in NSW are as follows:

• UCPR Form 111 – Letters of Administration Summons
• UCPR Form 112 – Grant of Letters of Administration
• UCPR Form 117 – Inventory of Assets
• UCPR Form 119 – Affidavit of Administrator

It is important that you take great care when preparing these documents, or when reviewing them if they are prepared by a lawyer.

In particular, you need to pay close attention to UCPR Form 119, which is an Affidavit. When you sign an Affidavit, you are swearing or affirming the truth of its contents. As such, you must carefully review and approve the document before signing it. If you do not agree with something in the Affidavit (or any of the documents), you should contact your lawyer so the document can be amended accordingly.

Signing appointment

Only an authorised witness can witness you sign your Affidavit. Authorised witnesses include:

• Lawyers
• Barristers
• Notary Publics
• Justices of the Peace

You should pay careful attention to the instructions provided to you for signing the Letters of Administration application. Most errors with Letters of Administration applications arise in the signing of the documents because people do not follow the instructions provided.

Estate Administration lawyers, such as the team at Safewill Legal, specialise in the preparation and signing of Letters of Administration applications. If you engage an Estate Administration lawyer, you can feel confident that your application has been prepared and signed properly and in accordance with the relevant legislation and rules.

Filing fee

You must pay the correct filing fee when you lodge the documents. The filing fee is calculated based on the value of the assets in the estate.

The scale of Letters of Administration filing fees in NSW (as at the date of publication) is as follows:

Your Letters of Administration application will not be processed until the filing fee is paid.

The filing fee can be paid by bank cheque, or via credit card/EFTPOS. If you need to pay by bank cheque, then you must include the cheque with the bundle of documents when they are submitted for lodgement.

If you would like to pay via credit card/EFTPOS, you must lodge the documents, wait to receive an invoice from the NSW Supreme Court, and pay that invoice via the phone. There are no online payment options as at the date of writing this guide.

Lodgement

Once the documents have been signed, you will need to collate the documents for lodgement:

• Original signed UCPR Form 111 – Letters of Administration Summons
• Original signed UCPR Form 119 – Affidavit of Administrator with the following annexures directly behind it
  • Original death certificate
  • Original signed UCPR Form 117 - Inventory of Assets
  • Any other signed annexures (as applicable)
• Two (2) sets of the following documents stapled
  • UCPR Form 112 – Grant of Letters of Administration
  • Photocopy of the signed UCPR Form 117 - Inventory of Assets
• A4 self-addressed and pre-paid envelope (the Grant of Letters of Administration will be returned to the Administrator in this envelope)

Send the bundle of documents to the Probate Registry.

Time frame

It normally takes the Supreme Court of NSW 4-6 weeks to review the application and make a Grant of Letters of Administration.

If there are any issues with the application, or if further information is required, the court will send you a requisition. A requisition is a request for further information or documentation. Most requisitions can be resolved in a straightforward manner.

Obtain the Grant

Once your application is approved by the court, you will obtain a formal Grant of Letters of Administration.

The Grant will look like a set of bound pages with UCPR Form 112 – Grant of Letters of Administration as the cover page, and a copy of UCPR Form 117 – Inventory of Assets. There will be a red sticker on the front page, which is the official seal of the court, together with a signature from the Probate Registrar.

Administer the estate

Lodge Notice of Intended Distribution

The Notice of Intended Distribution (the Second Notice) notifies the public that the Administrator has obtained a Grant of Letters of Administration and intends to distribute the assets of the estate to the beneficiaries entitled to inherit pursuant to the laws of intestacy.

If the Second Notice is lodged correctly, you must wait until the later of:

• 30 days after the Second Notice was published; or
• 6 months after the date of death

before you can distribute the estate to beneficiaries.

By lodging the Second Notice, and waiting the correct amount of time, you (in your capacity as Administrator) have personal protection against creditors of the estate, or any potential family provision claims, of which you may not yet be aware.

If this step is not followed correctly, and an Administrator distributes the estate too early, they may be personally liable to satisfy any outstanding estate liabilities and debts.

The process for lodging the Second Notice is similar to the process for lodging the Notice of Intended Application (discussed above). The Second Notice is published on the NSW Online Courts and Tribunals Registry website.

The fee for publishing the Second Notice is $48.00 (as at time of publication). You will need to enter your credit card details to pay for the Notice online, if you are publishing it yourself.

Open estate bank account

In most situations, an Administrator may need to set up a bank account in the name of the Estate to fulfil their duties. In order to set up an estate bank account, the bank will likely require certified copies of the Grant of Letters of Administration and death certificate.

As assets of the estate are redeemed and accounts closed, you should have the funds from these accounts paid into the newly established estate bank account. This will assist with record-keeping and helps ensure that no funds are misappropriated for personal use (either by mistake or intentionally).

Estate tax return

Depending on the assets of the estate, and how they are being dealt with in the administration of the estate, an estate tax return may be required.

It is recommended that you engage an Accountant to assess whether an estate tax return will be required, and if so, to prepare the relevant paperwork for lodgement with the Australian Tax Office.

Arrange payment of liabilities

The Administrator is responsible for arranging the payment of outstanding funeral and estate expenses, as well as any outstanding debts or liabilities of the deceased (including tax liabilities). These amounts can be paid from the estate bank account.

It is important to note that all liabilities and estate expenses must be paid before funds can be distributed to beneficiaries.

Distribute the estate

Once you have waited the appropriate notice period following the publication of the Second Notice, and all liabilities and estate expenses have been paid, you may arrange to distribute the residuary estate to the beneficiaries entitled to inherit pursuant to the laws of intestacy.

If there is an estate property to be transferred to a beneficiary (or beneficiaries), you will need to engage a property lawyer or conveyancer to complete the relevant transfer paperwork. Alternatively, it may be that you and/or the beneficiaries decide that the property should be sold. In this case, the proceeds of sale of the property would be distributed to the beneficiaries entitled to inherit pursuant to the laws of intestacy.

Depending on the assets of the estate, there may be a need to engage other professionals to assist you in dealing with and distributing the assets of the estate. If you are unsure of any aspect of administering the estate, it is best to obtain legal advice.

End of matter

Once Letters of Administration is granted, all liabilities of the estate have been paid, and all assets of the estate have been distributed, your role as Administrator will cease. However, it is important that you retain all documents and information relating to your administration of the estate somewhere safe in case they are ever required again.