Testacy searches and collection options when someone has died 277-01120020

Make sure the death has been confirmed. See Confirmation of death for Child Support customers.

When a parent or carer is deceased and debt is owed by or to them, further investigation is needed to confirm:

• if the person had an estate, and
• if there are other administrative options available to finalise the debt

If there is no debt or outstanding accounting, there is no need to locate or contact an executor for a deceased payer. See Table 7.

Debt or accounting issues may be defined as:

• Outstanding child support
• Overpayment
• Costs and fines
• Consolidated Revenue Debt
• Returned disbursement
• Excess cash

Attempt contact with the surviving parent to discuss the debt before exploring administrative options. See Customer contact following a death notification.

Administrative options include:

• an election to discharge child support debt or not recover an overpayment
• administrative correction of the debt
• payment of the debt
• obsolete Entry
• waiver

Services Australia cannot enforce payment of child support debts from an estate or an administrator.

When a debt (i.e. maintenance arrears) is owed to a person who is deceased, the estate or executor will provide instructions for the collection of the debt.

The surviving parent is required to continue to pay debt owed to a deceased person until a debt outcome is reached. Debt outcomes include:

• an election to discharge child support debt or not recover an overpayment is made by the executor or administrator
• debt waiver is approved by department of finance
• the debt is paid in full

There are limited circumstances were the agency may make a decision to temporarily suspend collection of a debt owed to a deceased person pending discharge or waiver. This may include:

• where the surviving parent now has the children in their care or the debt is not legally recoverable, and
• collection would not serve the purposes of the Child Support Act

These decisions should be made on a case by case basis in consultation with a Service Support Officer (SSO).

If there are unreconciled estimates in place for any case linked to the deceased person, all estimated income must be reconciled.

When DCM identify an estimate requiring manual reconciliation:

• create an Estimate Rec intray
• route to the Specialised Assessments team for action. See Customer Referral Guidelines (CRG) - Child Support > Estimate reconciliations

There are limited circumstances where estimates are not reconciled, which is when the deceased parent is a payer. See Manual Estimate reconciliation procedure for child support estimates (from 1 July 2011).

Escalate to a Service Support Officer (SSO) for further help if:

• the pending reconciliation may create a maintenance overpayment or overpayment of FTB entitlement
• the deceased person died during the estimate period (i.e. the estimate was truncated)
• the case has sensitivity, i.e. family/domestic violence or length of time since the parent has died
• testacy arrangements have not been confirmed and there is no other reason that testacy would be investigated, apart from for the purpose of the pending estimate reconciliation
• the deceased person is confirmed as testate and investigations to confirm if the estate has been finalised have been unsuccessful

The SSO should escalate cases for individual consideration as necessary.

Testate means a legal Will exists for the deceased person at the time of death.

Intestate means there is no valid Will at the time of death.

A Will is a legal document in which a person specifies the management and distribution of a person’s estate after death.

A Will names an executor or executors who will manage the distribution of a deceased person’s estate. The document will also specify any beneficiaries to the estate.

Formal evidence of a Will is required for an executor to act on behalf of a deceased person regarding child support matters.

Sufficient evidence of a Will is considered to be:

• a document that names the deceased person and an executor/s
• a document that is signed, dated and witnessed by another party prior to death of the person, and
• a document that is otherwise considered to be properly made

An executor is considered as a person authorised to act under the grounds of 'Other legal Authority'. See The Child Support Guide 6.3.6: Authorised representatives. The References page has a link.

The Executor must supply a copy of the Will naming them as the Executor or Administrator before any information can be released.

Note: if there are concerns about the validity of a Will, contact a Service Support Officer (SSO) for help.

Letters of Administration provides authority for a person to administer the estate of a deceased person who died without making a legal and valid Will.

A grant of Letters of Administration is issued by the relevant State Supreme court. The person or persons is appointed by the court to be the administrator of a deceased person’s estate.

The rules, time limits and costs for a person to obtain a grant of Letters of Administration varies from state to state.

Customers must obtain independent legal advice in relation to applying for a Grant of Letters of Administration to confirm if it is suited to their individual circumstances.

The Resources page has contact details for each state Supreme court.

Formal evidence of a Grant of Letters of Administration is required:

• for an administrator to act on behalf of a deceased person, and
• before any information can be released regarding Child Support matters

Evidence of a grant of Letters of Administration is a document:

• that names the deceased person and an administrator appointed by a Supreme Court, and
• is sealed and dated by the court

Probate is the process of proving and registering the last Will of a deceased person in a Supreme Court.

If a Will is considered legal and valid, an executor may be required to apply for a Grant of probate.

Rules and requirements as to whether Probate is required vary from state to state depending on the size of the estate and particulars of a Will.

Formal evidence of a Grant of Probate is required for an executor to act on behalf of a deceased person, before any information can be released regarding Child Support matters.

Sufficient evidence of a Grant of Probate is considered to be a document:

• that names the deceased person and an executor or executors, and
• is sealed and dated by the court

If the deceased person has significant assets, their family may be able to approach the Public Trustee to administer the estate.

The requirements of the Public Trustee will vary from state to state. If the estate is taken on by the Public Trustee, they are considered to be an administrator of the estate.

Formal evidence of appointment is required for the Public Trustee to act on behalf of a deceased person about Child Support matters.

Sufficient evidence of an appointment of representation is considered to be a document:

• that names the deceased person and the public trustee as the administrator of the estate, and
• is signed by a delegate within the relevant State Trustee office

An Executor de son tort is someone who is not legally named as an Executor or Administrator of a person’s estate, however they may be managing the finalisation of a deceased person affairs.

An executor de son tort can only be asked to pay the debt if they distribute an estate.

A next of kin is not legally defined in Australia and may vary from state to state.

In most cases, a person’s next of kin is their spouse or domestic partner. If not available, the next of kin may be (in priority order):

• Adult Children
• Parents
• Adult siblings
• any other person that may be deemed by an authority to be a next of kin

The agency is able to contact a next of kin to confirm:

• if a parent had a Will, or
• if there are any family members applying for Letters of Administration

Attempt to contact next of kin in priority order. Information about the debt, excess cash, undisbursed maintenance and funds owing to the deceased person can be discussed.

Strict provisions apply to what information Services Australia can release if it is in relation to the administration of the estate of the deceased person. See The guide 6.3.3 Secrecy provisions. The References page has a link.

If unsure please contact a Service Support Officer for clarification.

The Resources page contains letters to assist with making contact with next of kin.

To locate an Executor or Administrator:

• contact the deceased person's next of kin, family or the other parent or carer
• Review Customer First records to confirm who reported the death and contact the Centrelink informant
• Contact the Public Trustee in the state where the deceased resided or previously resided
• Undertake a Probate search in the state where the deceased resided or previously resided

When making contact with any parties, ask if:

• they are aware if the deceased person had a Will, or
• if any family members are applying for Letters of Administration

The Resources page contains letters to assist with making contact with executors and administrators.

If an executor is identified, ask for any contact details or the solicitor that may be managing the estate on their behalf.

Use the Deceased Customer Management (DCM) macro to document any contacts and update in the Deceased Client window.

Contact may be made with adult children when:

• notifying of a parent or carer death
• attempting to identify if a deceased person had a Will
• confirming if they or any siblings over the age 18 or next of kin may be considering applying for Letters of Administration (LoA)

When considering an application for Waiver of debt or to finalise DCM actions, if there are contact details readily available in Cuba for an adult child, the agency may use this information to contact an adult child.

Contact details (phone and address) may be obtained from:

• information available in Cuba
• external information, or
• information that is provided by next of kin and other organisations

Customer First must not be used to obtain contact details for adult children, as they are not considered to be a mutual customer. See Centrelink - Child Support information exchange, 2016 Governance Arrangement.

Searches to confirm if a payee had a Will or if a person has applied for a Grant of Probate or Letters of Administration, may be completed online or verbally over the phone.

Online searches for a Grant of Probate or Letters of Administration may be completed 10 weeks post the death of the deceased person.

The Resources page contains links to the contact details for each state Public Trustee and Probate (Supreme court) contacts.

When undertaking searches, review the deceased person's address history to determine if multiple searches may be required in different states.

For customers who resided in:

• Western Australia and Tasmania, a paid probate search is required. See the Resources page for probate search request
• New Zealand, email the Deceased Customer Management Team to ask for a public trustee and/or probate search with the relevant New Zealand organisations

When considering an Obsolete or Waiver decision, formalised testacy searches must not be more than 4 weeks old.

Document testacy searches completed in the Deceased Client window with the subject 'Testacy searches'.

If a formal search for Probate is required, create a DCM testacy search required intray and set the due date to 10 weeks post the death of the deceased person.

Confirmation of intestacy includes:

• no results located from formalised testacy searches with the Public Trustee and Supreme Court in all states the deceased person has resided
• all identified persons of interest (next of kin, adult children or other persons) have been contacted to confirm there is no Will or estate for the deceased person
• all identified persons of interest have confirmed they are not applying for Letters of Administration (LoA)
• there is no Will or estate otherwise identified

• Yes, see Table 4
• No, see Table 5

The usual administrative enforcement options (such as TRIPs and s72 notices) only apply to funds held for, or on behalf of, a child support debtor.

Upon death, a person's assets cease to belong to them. As there is no longer assets that belong to the child support debtor, Child Support has no enforcement options post death.

Similarly, notices cannot be issued against an executor or estate because they are not a child support debtor.

Check if the case or cases have any of the following:

• child support owed
• overpayment
• consolidated revenue debt
• returned disbursements
• excess cash
• Costs and fines

For collection to be pursued with an executor or administrator, Child Support must have:

• received proof of Executorship, and
• be recorded as Executor in the Customer Representative window

Contact the Executor or Administrator and confirm instructions regarding:

• collection of arrears, or
• potential election to discharge arrears

If the Executor requests collection of arrears, or chooses not to discharge the arrears, Child Support must pursue the arrears, follow the Debt repayment process.

Update the Bank Details window in Cuba with the bank account provided by the Executor or Administrator.

Note: to disburse to the Executor, remove any holds on the case and any special recovery conditions.

Has a debt outcome been achieved?

• Yes, go to Step 11
• No, see Table 7

To collect from an estate contact the executor, administrator or executor de son tort to advise:

• there is a child support debt to be paid from the estate
• they are required to lodge any outstanding tax returns for the deceased, which may change the debt owed to Child Support (Executor de son tort excluded), and
• request an expected timeframe for payment

Note: an executor de son tort is not authorised to act on behalf of an estate, required to lodge tax returns or waive any debts owing to the estate. They can be asked to pay the debt if they distribute the estate. They cannot act as executor for any other purpose.

Has a debt outcome been achieved?

• Yes, go to Step 11
• No, go to Step 12

If there is an overpayment owing, check if the overpayment is recoverable. See Child support overpayments and other payee debt.

If recoverable, depending on who the debt is owed to, either the surviving parent, carer or Executor can:

• elect for the agency not to recover the overpayment, or
• ask the agency to pursue collection from payee’s estate

Does the surviving parent, carer or Executor want the overpayment collected?

• Yes, go to Step 6
• No, see Child support overpayments and other payee debt

If the overpayment is legally recoverable and the person who is owed the debt (the surviving parent/executor) requests collection:

• advise that the agency will attempt to recover the overpayment and refund any collected funds
• obtain the estate’s bank details to allow future refund

Where the overpayment is owed by the deceased person contact the Executor and explain:

• how the overpayment occurred
• that the payer has requested collection, and it needs to be paid out of the estate, and
• they are required to lodge any outstanding tax returns, which may change the debt

Obtain an expected timeframe for income lodgement (if required) and payment.

Has a commitment to pay been given?

• Yes, go to Step 11
• No, go to Step 12

If the deceased person has a consolidated revenue debt, contact the executor and advise the debt should be paid out of the deceased person's estate.

Waiver - consolidated revenue debt

The Executor, or Child Support on behalf of the executor, can apply for a waiver of debt.

See Waivers for Child Support customers, if:

• the person is testate, and
• the estate is unable to satisfy payment, and
• all of the following criteria are met:
• no letters of administration have been granted
• the debt amount owed is under $20,000

Note: if the case does not meet all of the above criteria, it is important to note that Child Support might not support a Waiver if a period of less than 2 years has passed since the deceased person's death.

This is to allow sufficient time to determine if anyone intends to apply for, or has been granted, Letters of Administration.

Has a commitment to pay been given?

• Yes, go to Step 11
• No, see Table 7

If the deceased person has a costs and fines debt, contact the Executor and explain:

• the costs and fine debt amount
• how the debt occurred
• the debt needs to be paid out of the estate
• they are required to lodge any outstanding tax returns for the deceased person, which may change the debt

Obtain an expected timeframe for income lodgement (if required) and payment.

Has a commitment to pay been given?

• Yes, go to Step 11
• No, see Table 7

Where the deceased person has a returned disbursement or excess cash on their account check:

• the account is correct
• all incomes and unreconciled estimates are finalised, and
• disburse/refund the money to the Executor/administrator to the bank account provided by them

Once the Executor has been contacted, issue a proof of debt notice detailing the amount owed and any outstanding tax returns.

The Resources page contains a link to the Proof of debt notice.

Note: A peer to peer letter check is needed before sending this letter.

Create a DCM Estate follow up intray and monitor over a 60 day period.

Once monies are received from the estate, they will automatically go to the bank account recorded for the other parent.

If no payment is received, contact the Executor again and request if any funds are likely to be available.

Note: estates can take a long time to be finalised, sometimes several years.

If funds are likely to become available delete and create a new DCM Estate follow up intray and continue to monitor for payment.

If the estate advises there are no funds, go to Step 12.

If the estate advises, there are no funds in the estate to pay a debt, request confirmation of this in writing.

Once received, contact the surviving parent to advise the estate is unable to repay the outstanding debt and seek further instruction. The following options may apply:

• an election to discharge child support debt, or
• election not recover an overpayment

Parent does not elect to remove the debt

Advise them as the estate is unable to repay the monies overpaid:

• collection will not be actively pursed, and
• it is unlikely to be collected

If the estate advises there are no funds in writing and an election to remove the debt has not been received for:

• child support debt, go to Table 5, Step 6
• overpayment debt, go to Table 5, Step 8

When a person dies intestate, there are limited avenues available to finalise any outstanding child support issues, this is because there is no one who can provide instruction on behalf of their estate.

• If the case is a NZ 'In' case, see Table 6
• Otherwise, go to Step 2

If the deceased person has debt outstanding on their account and is intestate the options for addressing arrears are:

• discharge, go to Step 3
• letters of administration, go to Step 4
• public trustee, go to Step 5
• obsolete entry - deceased payer only, go to Step 6
• waiver, go to Step 7

For options relating to other debt types or outstanding accounting, refer to the following:

• overpayment of child support owed to the deceased, go to Step 8
• consolidated revenue debt, go to Step 9
• excess cash, go to Step 10
• costs and fines, go to Step 11

Contact the surviving parent and explain that because the deceased person died without a Will:

• no collection options have been identified from the estate
• the agency is unable to collect the arrears owed by the deceased person, and
• the debt will not be pursued, unless someone applies for letters of administration for the deceased person's estate

If they wish to discharge the arrears see Collection of child support payments privately and/or discharging arrears.

If debt has been discharged, see Table 7.

The deceased person’s family or next of kin, can apply for letters of administration to gain authorisation to administer the deceased person's estate. Letters of administration are dealt with in the Supreme courts, so the costs and processes vary state by state.

If there is a family member or next of kin considering applying for letters of administration create a DCM Estate Follow Up intray and monitor for 60 days. If letters of administration are received:

• treat the administrator in the same manner as an executor, and
• follow the process detailed in Step 3 in Table 3

If Child Support does not receive letters of administration in that time, contact the person who was considering applying and check if that is still their intention.

If no-one is applying for letters of administration consider:

• a discharge, go to Step 3, or
• finalise DCM actions, see Table 7

If the estate is referred to the public trustee, treat them in the same manner as an executor and follow the process detailed in Step 5 in Table 3.

Note: Child Support cannot refer a deceased customer’s estate to the public trustee.

If the deceased’s estate is not going to be referred to the public trustee then consider:

• a discharge, go to Step 3,
• or finalise DCM actions, see Table 7

An entry associated with an intestate payer is only eligible for deletion from the Child Support Register in accordance with section 41 of the Child Support (Registration and Collection) Act 1988 if:

• the payer has no known assets, and
• the case has been ended for 2 or more years

See Obsolete Child Support entries.

A surviving parent may consider applying for a waiver if the other parent or carer is deceased and the following criteria apply:

• no letters of administration have been granted
• there is no administrative option available to address the debt
• there is no Will or Grant of Probate
• any children over the age of 18 do not intend to apply for Letters of Administration, or
• any children under the age of 18 and are either being financially supported by the surviving parent or that the person caring for the child does not intend to apply for Letters of Administration on their behalf

Note: a waiver application can be made if the deceased person is testate but it is unlikely the request will be supported. If this occurs contact a Service Support Officer (SSO).

See Waivers for Child Support customers.

If a period of less than 2 years has passed since the parent or carer’s death, tell the parent that Child Support might not support a waiver. This is to allow sufficient time to determine if anyone intends to apply for, or has been granted, Letters of Administration.

Check the parent’s incomes, and discuss lodging outstanding tax returns or Income Tax Declarations, if needed. This is to make sure that the debt owed is correct.

If the case is not suitable for a Waiver of debt, tell the customer:

• collection will continue, and/or
• if collection is not in place, collection must recommence

If the deceased person paid too much child support and is intestate, collection action to recover the overpayment can continue if Child Support has been provided with an avenue to refund any recovered funds.

Collection of an overpayment should only cease if Child Support has no means to refund the overpayment i.e. no bank account has been recorded or funds have been returned.

If a decision is made not to collect the overpayment, on the basis that there is no avenue to refund, remove the overpayment from the system. This is to make sure automatic recovery does not occur.

Document why the overpayment has been removed, with information confirming that this action may be reviewed if an executor or administrator for the deceased customer is located. See Overpayments Cuba Process Help.

If a decision to remove the overpayment has been made, see Table 7.

If the person is intestate there are no collection options for a consolidated revenue debt, unless the deceased person's family apply for letters of administration or refer the estate to the public trustee.

Waiver - consolidated revenue debt

The administrator/public trustee, or Child Support on behalf of the deceased person, can apply for a waiver of debt after a period of 2 years.

If:

• the deceased person is intestate and all of the following criteria are met:
• no letters of administration had been granted
• the debt amount owed is under $20,000
• see Waivers for Child Support customers

Note: if the case does not meet all of the above criteria, Child Support might not support a waiver if a period of less than 2 years has passed since the parent’s death.

This is to allow sufficient time to determine if anyone intends to apply for, or has been granted, Letters of Administration.

If the deceased person is intestate there is no options to refund the excess cash. It will remain as excess cash on the account.

Go to Table 7.

There is no administrative avenue to remit costs and fines from a deceased person's account.

The debt may be referred after a two-year period for a registrar initiated waiver, if:

• the deceased person is intestate, and
• there is no avenue for collection, and
• no letters of administration have been granted

See Waiver - consolidated revenue debt in Step 10.

If no collection options are available from the estate, or the person has died intestate, complete the following:

Create a RETURN TO NZ - CUSTOMER DECEASED intray with the following information, as requested by NZIR:

• IRD (OS-ID in Cuba)
• CSID
• Customer name
• DOB
• Date referred to Services Australia
• Date of death
• Proof of death document
• Testacy searches: Y/N - For the following searches, dates of contact are required:
• public trustee, Y/N
• probate searches, Y/N
• contact with next of kin, Y/N
• is there a Will, Y/N
• testacy, has an executor been identified, Y/N/NA
• finalised estate, Y/N/NA
• intestate; letters of administration, Y/N/NA

Make sure the Service Officer's contact details are added to the intray notepad with the reason for contacting International, for example, DCM Return to NZ - Customer Deceased.

• Save a copy of the notepad into the Case window
• Route the intray. See Customer Referral Guidelines (CRG) - Child Support > International Servies

Procedure ends here for the DCM Service Officer.

The International Central Authority Team will proceed with the Withdrawal of the case and return to NZ.

The Central Authority (CA) Service Officer will:

• make sure all details have been provided to return the case as Customer Deceased
• process the withdrawal
• advise NZIR of the Return by completing the ‘Customer Deceased’ tab on the ‘Returns to NZ’ spreadsheet

See the Finalisation table in New Zealand Case Management - Withdrawals and Returns to NZIR from Child Support (Central Authority Service Officer).

If the debt has been withdrawn, see Table 7.

Create a note using the Deceased Customer Management (DCM) macro - FINALISATION, if the case meets finalisation reasons:

• Parent or carer confirmed deceased (proof of death confirmed)
• Debt has been finalised or debt outcome achieved
• All other matters associated with the deceased record has been finalised

Unlock the customers using ownership rules. See Finalisation Guidelines for Child Support staff, Deceased Customer Management (DCM).

Note: some cases may continue to be managed in DCM for an extended period due to unusual or sensitive circumstances. Discuss these cases with a DCM Team Leader.

If the case is International create a stakeholder follow up intray with a DCM finalisation notepad, copy the document into the Case and Deceased Client window. See Customer Referral Guidelines (CRG) - Child Support > International Services.

Otherwise, procedure ends here.