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Mutual Wills (NT)

When two people have intertwined finances, they sometimes choose to make special testamentary arrangements together. For instance, in the Northern Territory, a couple can choose to make mutual wills to ensure their family is provided for after their deaths. A mutual will can be in the form of one combined document known as a joint mutual will, or two separate documents known as mutual wills. This article explains the purpose of mutual wills in the Northern Territory.

Standard Wills

A testator might leave their deceased estate to their spouse as their main beneficiary, on the understanding that their spouse will leave their own estate to their children when they pass away. However, there is nothing to stop the surviving spouse from then disinheriting the deceased’s children to benefit someone else. This is a particular concern when a widow or widower remarries and wants to make their new spouse their primary beneficiary.

Mutual Wills

In this scenario, one option for the testator is to create mutual wills with their spouse. Mutual wills (otherwise known as inheritance agreements, joint wills, and binding wills) are made by two or more parties who agree to how their property is distributed upon their deaths. With mutual wills, several people make a testamentary agreement on the distribution of their assets that applies irrespective of which party dies first. The mutual wills allow the surviving party to enjoy the benefits of the estate during their lifetime, while respecting the other testator’s testamentary wishes. It provides more flexibility for the surviving party than other testamentary instruments such as a life interest bequest.

It is often couples with blended families who sign mutual wills because they want to protect the rights of their children from former relationships. This is a good choice for a second marriage because it allows a testator a measure of certainty to make arrangements for their own children, while being able to make their current spouse their primary beneficiary. In this way, a surviving spouse can benefit from the deceased’s estate but not disinherit the deceased’s children.

Amending A Mutual Will

Wills are meant to be updated, revoked and replaced as necessary. Ordinarily, a testator updates their will regularly as their financial and personal circumstances change. By contrast, the defining feature of a mutual will is that it cannot be revoked after the death of one of the parties.

A party to a mutual will must have prior consent from the other party to change or amend the will. This means that once one of the parties dies, the survivor is bound by the terms of the mutual will. An essential factor of a mutual will is the agreement between the parties, an agreement that can either be in writing or in the form of an oral agreement. However, when the agreement to amend the will is given orally, there needs to be some form of proof that there was an agreement between the parties.

If a surviving party does revoke a mutual will, they are guilty of fraud because they accepted a benefit without abiding by the other terms of the agreed contract. In that case, the beneficiaries of the mutual will have legal recourse against the surviving party and can enforce the terms of the mutual will.

Disadvantages of Mutual Wills

Because mutual wills are inflexible, they cannot comprehensively account for the future. For instance, if one spouse dies tragically young, the surviving spouse may be bound by the mutual wills for decades. This means that if the surviving spouse wants to remarry in the future, they cannot provide for their new spouse, or indeed any future children, in their will. As such, mutual wills are more appropriate for older couples who are unlikely to remarry or have more children after their spouse’s death.

There is also potential for the surviving spouse to nullify the impact of the mutual will by depleting the assets of the estate during their lifetime, leaving no inheritance for the ultimate beneficiaries. In that case, the testator might include a testamentary trust in the will to exert further control over how the other party uses estate funds.

Who Can Use Mutual Wills?

Mutual wills are not exclusively used by couples. Any pair (or larger group) can sign mutual wills to legally bind each other to an agreed deceased estate plan. For instance, this type of testamentary arrangement may be appropriate for siblings who wish to ensure that a family property is handed down to their direct descendants. Business partners might also find it appropriate to sign mutual wills to leave each other controlling interest in the business.

In every case, the testators need to take care when drafting a mutual will to consider likely future scenarios and include the right provisions for their circumstances. Because these agreements are drafted upon complex legal principles, the testator must consult with an experienced wills and estates solicitor. The solicitor will outline the various options and provide recommendations on whether mutual wills are appropriate.

Please call 1300 636 846 or contact Go To Court Lawyers for advice if you have concerns about ensuring that your wealth passes ultimately to your children when your spouse dies. The team can discuss your options with you to provide greater protections for your ultimate beneficiaries.


Nicola Bowes

Dr Nicola Bowes holds a Bachelor of Arts with first-class honours from the University of Tasmania, a Bachelor of Laws with first-class honours from the Queensland University of Technology, and a PhD from The University of Queensland. After a decade of working in higher education, Nicola joined Go To Court Lawyers in 2020.

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