The position in Australia is that for the most part, a beneficiary must be a person in order for the courts to decree performance. Furthermore, in order for a valid trust to be created, a gift must be made to a charitable body.

Australian case law has generally ruled, that a gift must be charitable and drafted for the benefit of an actual person – rather than a gift for the maintenance of an animal.

Although case law may have by and large ruled against making a gift of maintenance for a pet, however, the law may not, prevent a person from theoretically providing for the maintenance of a pet in which they have an attachment towards.

In the event that an individual wishes that a particular person provide maintenance for their beloved animal, the provision should be drafted in such a way that it cannot be left for others – such as the person providing the maintenance of the animal – to change the conditions, therefore, potentially overriding the wishes of the person making the trust. So if you want someone to provide maintenance for your pet, always make sure you do so carefully.

There is no doubt that many of us will develop a close connection to pets or animals that have provided us with company. Furthermore, many of us will understandably want to provide adequate care for our cherished companions after our passing. However, the law in Australia is rather tricky, and the bestowing of a trust towards an animal can be rather complex and for the most part, may be not feasible.

Provided that the Div 50 of the Income Tax Assessment Act 1997 (Cth) conditions are met, charitable trusts will be exempt from income tax. In addition to exemptions from income tax, charitable trusts may enjoy concessions for payroll tax, fringe benefits tax, land tax, stamp duties and other forms of taxation.

Valid charitable gifts can potentially be held in perpetuity, however, at the time of inception, the charitable trust must satisfy the rule against perpetuities.

On an initial reading, trusts that interfere with the sanctity of a marriage by encouraging the dissolution of a marriage are void. In Church Property Trustees, Diocese of Newcastle v Ebbeck [1960] 88; (1960) 104 CLR 394, the testator bestowed his residuary estate on trust to his wife for life, and subsequently, to his sons in equal shares which would be forfeited if at the time of the passing of his wife, the sons or their wives failed to profess the Protestant faith. Before the will came into being, two of the testator’s sons had married women of the Roman Catholic faith, and the third son was also about to marry someone who followed the Roman Catholic faith. The High Court held that the clause had a tendency to encourage the dissolution of a marriage and contrary to public policy, and was held to be void to the extent that the clause restrained religious choice (at 8):

“In the condition contained in the proviso to the gifts in remainder made by the will now before us general terms are used, but the purpose or at all events the effect is specific. It is specific because it applies to a precise situation in which each of two sons already stood and upon which the third was about to enter. It meant that to avoid the forfeiture of the gift the son must, whether by chance or design, obtain a change of the situation so that either his wife changed her religion or ceased to be his wife; and that must be before his mother died. For present purposes the condition that at his mother’s death he himself should not be of the Roman Catholic faith may be left out of consideration and so may the fact that the gift in an alternative form takes effect subject to the same proviso in the event which did not happen of the testator’s wife predeceasing the testator. It is true that, had that event occurred, assuming the proviso to be valid and not inoperative, it would have been determined at the death of the testator whether the condition was in each case fulfilled; there would have been no interval for recantation of faith or dissolution of marriage. But we are concerned with the form of the proviso which applies to the events that did happen. In a marriage between a Protestant husband and a Roman Catholic wife it makes the continued adherence by the wife to her faith the cause of his forfeiting his very substantial share in his father’s estate with the alternative of his disencumbering himself of his wife before his mother dies. Whether designedly or not such a disposition creates an opposition between the wife’s religious beliefs and a serious temporal interest of her husband, and doubtless by consequence of her own. If she cannot or will not desert her faith it provides an inducement to him of a pecuniary or proprietary nature the operation of which cannot but be in opposition to the policy of the law, its policy to preserve and maintain marriage.”

However, in Ramsay v Trustees Executors and Agency Co. Ltd [1948] HCA 44; (1948) 77 CLR 321, the High Court upheld the direction of the testator that his son would be absolutely entitled to the capital of a trust estate if his wife, still being his wife, dies before him, or if the marriage is terminated by divorce. It was argued that the interest in the trust estate was given upon an illegal condition because it was an inducement for the testator’s son to bring about a divorce. However, Latham CJ said (at 5):

“[T]hat the provision in this particular case was intended (so far as intention is important) to secure an income to the son during the marriage, and to prevent his wife obtaining any interest, either directly under the father’s will, or indirectly through her husband’s will, in the corpus. There is nothing illegal in such an intention – it is simply a case of a testator choosing his beneficiaries.”

There may be an obligation for the superannuation death benefit to be paid into an estate via a trust deed, or a binding death benefit nomination. Furthermore, a trustee is able to exercise their discretion under a trust deed by paying their entitlements into the estate, and if such a course of action is undertaken and is not challenged, the benefit will then form part of the estate.

If the superannuation benefit has become part of the estate, then the ordinary family provisions will be applicable.