Legal Tip 428: Getting Money for Funeral Expenses without Probate

If a person dies and has money in their bank account the bank can release up to $15,000 without Probate or Letters of Administration being granted for funeral expenses.


Example

Barney dies from a fried liver. Too much Duff Beer.

Homer organises the funeral and thinks Barney had no assets, but then he remembers he had a bank account with the FUD Bank. Homer rocks up with his $10,000 receipt for the funeral and he asks to be reimbursed for what he paid.

The staff send it off to the deceased estates team and Homer is given $10,000 from Barney’s account. Homer is not the executor and there is no probate granted and there is no Administration granted either.


Section 69B Banking Act 1959

BANKING ACT 1959 - SECT 69B Powers about money of depositors who have died

 

Many banks raise issues with this. Even to maintain a mortgage ie "debts".

 

Yes the bank or ADI might still refuse as is their right and they cannot be blamed if they act or fail to act because of subsection 2. ie. s69B(2) of the Banking Act 1959

 

Can an executor sell deceased’s house without probate?

 

Not legally!

 

Probate is the process of passing legal authority to executors. Until this they have no capacity at law and family incl a sole beneficiary certainly have none. A property sale would be ultra vires. This means...acting beyond one's legal power or authority. A buyer could find the contract voidable with no recourse. Return of deposit and agent gets nothing. Suing is problematic.

Like spending $3 notes. Or shares in the harbour bridge

 

What happens when people share the bank account that is only in the name of the deceased, and the surviving party continues to use it for day to day expenses (like paying for that funeral for example)?

 

Have seen this happen when family member has access to bank account of a parent who dies.
As soon as the bank becomes aware of the death they will freeze the account, but unless the deceased was receiving centrelink or pension the bank won't know for some time.

 

There is a development in this space. The Govt shares death information with a lot of people including banks, ATO, super and more. Its not uncommon to find a spouse wakes up to find an account or a pension or super pension frozen and they didnt say a thing. If the person dies in a hospital it is quick. We often see them removed by the ATO quickly. We must then ask the executor aftre probate if they want us reappointed. In the old days it was assumed. A financial adviser can act to assist super. The fund will defer many actions until probate.

Its shared with commonwealth through to all states & territories

Australian Death Notification Service

 

Its common though for executors to jump the gun and start marketing a house that they don’t own and having the contract ‘subject to probate’.

Legal Tip 141: Buying a property subject to Probate Legal Tip 141: Buying a property subject to Probate

 

They would not be legally able to access the bank account if they are not a co-owner or signatory perhaps. Contractually as well. Co-owners could continue, but co-signatory's authority would cease at death, and it could be theft if they remove funds after.