NSW Trustee arrangement for minors

[snoop]

Hi, have a question regarding the establishment of a Trust Fund which forms part of my will. The beneficiary is a minor (under 16). How do I ensure the Trust is protected if they pass away before they are 16, or have not made a will at the time of passing. I believe 16 is the minimum age for a Will to be created. The Trust is one which will pass from the beneficiary to their kids and - hopefully - will be for a sizeable chunk ( between 600k and 1.1mil ). The situation is the beneficiary ( my daughter ) has a half sibling who she never sees and has absolute minimum contact which is only via social media. This sibling received a sizable inheritance when the parent they shared passed away. The funds for the Trust will be from my estate with Super/Life Insurance making up at least 60% of the funds. I want to ensure in this situation that the Trust is closed and the funds are distributed to family who would have supported and helped raise my daughter post my passing and her cousins. Whilst I appreciate the sibling - through birthright - is entitled to some funds. I do not want him to receive all of the funds as I am leaving a gift to him in my will to ensure the estate is protected against any claims made. My stepson has never lived under the same roof as me, and has never been financially dependent on me.
I know this question may seem silly, however I am fighting cancer at the moment and want to ensure every T is crossed and every i is dotted. I am not being mean or nasty to the step child. They refuse to have anything to do with us, and will never even take the time to spend time with their sibling even without me being present. I am ultimately after a clause I can insert into the Trust document which covers a situation whereby the beneficiary line is no longer there and details how the Trust is to be divided.
Is this possible?

 

[Rob Legat - SBPL]

In will drafting, at least in Queensland, it's common to have provision that if someone doesn't survive you for a certain period (say 30 days), then the gift skips them (and therefore their estate). However, I've never seen the case where someone doesn't get a bequest simply because they haven't made a will; and I would think that might be too restrictive to be allowed - but I could be wrong, having never considered the fact.

If someone dies without a will (ie intestate), the NSW succession legislation will set out how their estate is distributed. You should look at and consider that as part of your consideration; accepting of course, that it may change in the future.

Your other option is to leave the bequest on trust until the beneficiary reaches an age where (you would hope) they are mature enough to have made their own will.

 

[snoop]

Not sure we are on the same page. The beneficiary of the Trust is my daughter. I want to add a clause into the Trust which covers:

A: If she passes before she is 16 which is the min age in NSW someone can write a will
B: If she passes post 16 years of age and has not written a will.

What I want to ensure is that if one of the above occurs that the Trust is closed and the proceeds are distributed to my nieces and nephews and not soley to the Step Son. Appreciate they are to also receive a portion, but I do not want him receiving the full Trust payment.

 

[Rob Legat - SBPL]

If your daughter receives a distribution under the trust, it becomes her property and you can't direct what she does with it. What if she makes a will, but wants to leave it all to the step son? What if she makes a will you would approve of, receives the distribution, and then changes the will? Or, gets the distribution and just gives it to him?

You can't control what other people do with the property once it becomes theirs.

If you're worried about it, leave it in the trust.

 

[snoop]

It's the proceeds of the Trust I am concerned about. What she does after I am gone is up to her. I just want to ensure/protect the Trust funds - which will be sizeable - from going to the stepson by default as he would be from a legal standpoint her closest relative.