Key factors courts consider before making a Crisp(s)** order

As set out in the post last week, a Crisp order can be made by courts to vary a life interest or right of occupancy in certain circumstances.

Generally, courts are reluctant to grant a Crisp order as they do not bring complete and immediate closure to a deceased estate.

This said, particularly where the house represents a significant proportion of the overall value of the estate, courts will at least consider a Crisp order.

The key issues that the courts normally take into account in this regard include:

1. The duration or length of the marriage. Generally Crisp orders are most relevant where the deceased spouse is in a second or subsequent life relationship;
2. The contribution by the current spouse to the deceased’s welfare;
3. The overall size of the estate;
4. The financial stability of the spouse, respecting the spouse’s need for security and independence for the balance of their life; and
5. The financial status and health of the beneficiaries nominated under the will to receive the capital value of the house on the ending of the (initially designed) right to occupy or life interest.

Clearly, each of these factors are subjective and therefore any litigation where a Crisp order is sought will largely turn on the court’s interpretation of each competing interest.

** for the trainspotters, the title today is riffed from the Radiohead song ‘True love waits’.

View hear (sic):

Crisp (apples)** and orders

The concept of a 'Crisp order' takes its name from the decision of Crisp v Burns Philp Trustee Company Limited [NSWSC, 18 December 1979, unreported].

In that case, a widow who was granted a mere right of residence in a home under her husband’s will challenged the provision as inadequate.

The court decided to allow the former matrimonial home to be treated as if it were an ‘accommodation fund'. This meant that the widow could use the entire value of the home to help meet her accommodation needs for the balance of her life.

In other words, on request, the executor of the estate was required to use the capital value to purchase alternative accommodation for the widow, such as a smaller house, entry into a retirement village or a nursing home.

Ultimately, Crisp orders are intended to provide a form of flexible life interest to a surviving spouse to ensure that they have access to appropriate accommodation until their death.

Any capital remaining following the death of the surviving spouse will then generally pass as originally anticipated under the will of the person whose estate was originally challenged.

The post next week will list out some of the key factors normally taken into account by a court before granting a Crisp order.

As usual, please contact me if you would like access to any of the content mentioned in this post.

** For the trainspotters, the title of today's post is riffed from the classic song ‘My favourite things'.

Check out the Julie Andrews version here: