Any advice - Stepmother contesting provident fund payout.

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Kilgore_Trout_Redux

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Sadly my father-in-law passed away recently. He added each of his daughters as a beneficiary on his provident fund. The total amount going to them adding up to less than 20% of the total payout - the rest going to the step-mother.

Of course the step-mother, living up to all the tropes is contesting.

I'm going to withhold personal judgements in this thread but I would like to know where this leaves us. What is the process for dealing with these disputes? What are the chances of being screwed when the beneficiary totals seem more than reasonable in the step-mother's favour?

Is this one of those cases where reason should prevail?
 
Is the beneficiary document all in order? and his will?

If so, the step-mom can bitch all she wants, she has no say.
 
The decision rests solely in the hands of the fund Trustees. His will and beneficiary documents are merely suggestions to the Trustees. They have a duty to distribute his funds to those that were financially dependent on him.

So it could be that if all of the daughters we financially independent then the step-mother could have a case here. The Trustees will now try and determine the extent of financial dependence of each party here and that will decide it.
 
You normally have to specify the percentage each of the beneficiary's will receive. Should be in the documentation.
 
flippakitten said:
You normally have to specify the percentage each of the beneficiary's will receive. Should be in the documentation.
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This is what happened. Stepmother got 80% daughters got the rest.

Going by what Almightybender said it looks like the daughters can get screwed.
 
AlmightyBender is right - it's got nothing to do with his will, and the beneficiary document is merely an indication of his wishes, not an instruction, and the trustees will make the final decision. So what the OP needs to do is prepare documentation to submit to the trustees either showing a level of dependence on the deceased or proving that the step-mother wasn't dependent on him.

The trustees will usually try to take into account the wishes of the member, but their first responsibility is to the member's dependents.
 
AlmightyBender said:
The decision rests solely in the hands of the fund Trustees. His will and beneficiary documents are merely suggestions to the Trustees. They have a duty to distribute his funds to those that were financially dependent on him.

So it could be that if all of the daughters we financially independent then the step-mother could have a case here. The Trustees will now try and determine the extent of financial dependence of each party here and that will decide it.
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hmm, that sux big time. My executor didnt say anything about it being a guideline.
 
Colin62 said:
If it's an insurance policy, then it's an instruction, not a guideline, but pension and provident funds are different.
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aah thank you. So just to confirm, the insurance policy will pay out the way I want it to whereas with the pension and provident funds will be up to the trustees discretion. I assume that any shares and properties will also go to the person I said it should go to, not up to the trustees discretion (unless those shares and properties are in the trust fund).
 
@Almighty and Colin - thanks for your excellent advice on this. I really appreciate it when people who know what they are talking about educate me in these matters.

I also thought these beneficiary declarations were instructions which could only be overturned under certain circumstances.
 
Last edited:
I learnt something new today, I also thought they were instructions...

Very interesting, and thanks guys.
 
If it is contested, the trustees will interview all beneficiaries and all potential beneficiaries determining the extent of their financial dependence on the deceased.

If the trustees determine the stepmom alone was dependent on the deceased but her >80% share would be more than adequate for her financial needs, then all will be paid out according to the deceased's wishes. It would also be worth noting that if your wife's dad often gave money to your family (child's music lessons, clothing, or a contribution towards your rent etc) then this will count in your wife's favour when the trustees do their investigation.

Do not expect this to be resolved quickly though.
 
the eskimo said:
...It would also be worth noting that if your wife's dad often gave money to your family (child's music lessons, clothing, or a contribution towards your rent etc) then this will count in your wife's favour when the trustees do their investigation.
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This is where it gets a bit emotive. As people who are very prideful we have always made the sacrifices necessary to stand on our own two feet and it hasn't always been easy to do so.

We have scrimped and saved enough to emigrate now and while we didn't ask for it that token gesture by her deceased father was an extra month of liquidity while we searched for work and settled in.

While she "ums" and "ahhs" on Facebook about whether to buy a new German luxury car or not.

Considering the amount of support we (Especially my wife) have given her lately it stings a bit.
 
Money can make or break relationships. The true depth and breadth of a relationship is revealed when money especially lots of it is brought into play.

Sadly some people value money more than relationships and may not even try to step tactfully around the situation, it can become a case of give me my money or gtfo.
 
Kilgore_Trout_Redux said:
Sadly my father-in-law passed away recently. He added each of his daughters as a beneficiary on his provident fund. The total amount going to them adding up to less than 20% of the total payout - the rest going to the step-mother.

Of course the step-mother, living up to all the tropes is contesting.

I'm going to withhold personal judgements in this thread but I would like to know where this leaves us. What is the process for dealing with these disputes? What are the chances of being screwed when the beneficiary totals seem more than reasonable in the step-mother's favour?

Is this one of those cases where reason should prevail?
Click to expand...

He would have completed a nomination form for beneficiaries. With a split totalling up to 100%.

She can cry and dispute all she wants. The pay-out will be according to that nomination form. Only a court can change that, but seeing as she's already getting 80% as per his wishes I can't see a judge changing it al all.
 
Pitbull said:
She can cry and dispute all she wants. The pay-out will be according to that nomination form. Only a court can change that, but seeing as she's already getting 80% as per his wishes I can't see a judge changing it al all.
Click to expand...

Did you even read the thread?
 
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