The information provided below is general in nature and should not be relied upon legal advice. You should call 03 5445 1000 and speak to a lawyer at OFRM about your particular circumstances.

Is the expectation of an inheritance relevant to my property settlement?

Is the expectation of an inheritance relevant to my property settlement?

A common issue that arises in property settlement negotiations is how do you take into account that one party is likely to inherit a significant amount in the future.

An expectation of inheritance is not property that can be divided. However it can, in certain circumstances, be taken into account by a Court as a financial resource of the party who is expecting the inheritance which can therefore adjust the percentage division.

The circumstances in which a Court can take into account an expectation of inheritance are very narrow and will ultimately depend on the unique facts and circumstances of each case. Circumstances lending the Court to take such matters into account are as follows:

  1. Where the likelihood of the inheritance is high – for example the party is the only child of elderly parents
  2. The value of the expected inheritance as compared to the assets currently for division between the parties.
  3. The age and health of the person expected to provide the inheritance, in particular whether this person has lost capacity to alter their Will. If there is a reasonable prospect that a Will could be altered then such expected inheritance will not be taken into account at all.

One of the difficulties in seeking to include an expectation of an inheritance in the property settlement negotiations is obtaining evidence of the expectation.

The relevant person who’s will is in issue, usually a parent, is under no obligation to produce their Will unless in a very narrow set of circumstances. Such circumstances are usually where the testator no longer has testamentary capacity to make a new Will. The relevant testator is otherwise under no obligation to make any disclosure as to their financial circumstances.

In summary, an expectation of an inheritance can be taken into account in property settlement negotiations but only in a relatively narrow set of circumstances and you should speak to a member of our Family Law team on 03 5445 1000 for advice.