Usually, when an artist or other person passes away, their will is the document that sets out how they want their belongings to be distributed among their family and friends. If a person passes away without leaving a valid will, that person is said to have died “intestate”. If they have a will but it only deals with some of that person’s belongings, that person is said to have passed away "partially intestate".
If a person passes away intestate, the laws of intestacy will determine who is entitled to have that person’s estate. If the person passes away partially intestate, then the law determines how to distribute those things that are not covered by the will.
In South Australia, the laws of intestacy are set out in the Administration and Probate Act 1919 (SA)(the Act). The rules in this Act apply to the estate of any deceased person who left property, real or personal, in South Australia. Intestacy rules will apply when the deceased did not leave a will or to any property which was not effectively covered by the deceased person's will if they did leave one.
Different rules may apply in relation to property which is located outside South Australia or to property in South Australia which belonged to a person who lived elsewhere at the time of their death.
The intestacy rules may require the deceased person's assets to be distributed in a way that is very different to the outcome that the family of the deceased person expect, and may also be very different to the result that the deceased person would have wanted. In particular, these rules may be very different from the traditional or customary way of dealing with the passing of an Indigenous person. For that reason, it is usually sensible to prepare a will to make sure that the estate goes to the family and community members that the artist believes should receive them.
In this information sheet, we focus on how the rules of intestacy will operate in relation to an Indigenous artist who was living in the South Australia at the time he or she passed away.
The assets owned by a person at the time of their death are described as that person’s “estate”.
The estate can include real estate (property), cars, insurance policies, money in bank accounts, shares, artwork, furniture, jewellery and clothes and even debts owed to the person such as money due from the sale of artwork. Sometimes the estate will also include mining royalties or superannuation. The estate may also owe money, such as for credit card bills or car payments.
Importantly, every artist’s estate is likely to include copyright in the artwork created during his or her lifetime. Copyright can be an important source of income for an artist’s family as it lasts for 70 years after the artist passes away. The estate can earn royalties for the right to reproduce the artist’s paintings in auction catalogues, art books and merchandise long after the paintings themselves are sold and the artist has died.
In addition, with the passing of the Resale Royalty Right for Visual Artists Act 2009 (Cth), the artist’s estate will include the entitlement to resale royalties on all eligible commercial resales of the artist’s works which take place in the 70 years after the artist’s passing.
For most Aboriginal and Torres Strait visual artists, the most important assets in the estate are likely to be the following:
1. Money in any personal bank account held in the artist’s name;
2. Money held by the art centre from the sale of paintings;
3. Paintings held by the art centre or a commercial gallery or dealer on consignment;
4. Resale royalties; and
5. Copyright including entitlements to licensing royalties from collecting societies or under licensing deals negotiated during the artist’s lifetime.
As well as assets, the estate is also responsible for certain debts and other liabilities. The liabilities of the estate will include paying any costs associated with the funeral, and any other debts of the deceased artist such as any income tax that might be owed.
In this information sheet we only deal with the assets and liabilities listed above. If the estate contains assets or liabilities other than the ones mentioned above, we recommend you get legal advice as to the appropriate procedure to deal with them.
The intestacy rules identify certain family members as the ones entitled to the artist’s estate after he or she passes away. Those family members are called the ‘beneficiaries’.
In many cases, where an Indigenous person passes away leaving very few belongings, the family and community will simply deal with those belongings in the way that they think is appropriate and questions of intestacy law may never arise.
The Administration and Probate Act sets out a series of rules for distributing intestate estates to a deceased person’s spouse and next of kin. The rules are very precise and it is wise to get legal advice about exactly which distribution rules will operate in each particular circumstance.
According to the rules set out in the Act, where an Indigenous artist dies intestate, their estate will divided among the following surviving persons as follows[i]:
When the deceased artist has a husband, wife or partner who is still alive?
The deceased artist's 'spouse' or 'domestic partner' is entitled to the whole of the intestate estate if the artist is not survived by any children, grandchildren or great grandchildren (that is, by any of the deceased's direct lineal descendants who are also referred to as an 'issue').
A 'spouse' means a person who was legally married to the deceased artist at the date of his or her death.
To be recognised as married, a couple must have met the formalities of marriage set out in the Marriage Act 1961 (Cth). This means that a traditional Indigenous marriage may not be recognised and that a husband or wife in a traditional law marriage may not be considered as a spouse under the intestacy rules in South Australia.
The term'domestic partner' is defined in the Family Relationships Act 1975 (SA). A person is the domestic partner of another person if:
The couple have been living in a 'close personal relationship' for a period of three years or, during a period of four years for periods totalling not less than three years; or
A child has been born to the couple.
Some of the circumstances which will indicate that two people are in a domestic partnership include the duration of the relationship, the nature and extent of common residence, sharing financial resources, common ownership of assets, shared performance of household duties, caring and supporting children, a sexual relationship and having a mutual commitment to a shared life. Not all these circumstances need to be present to be in a domestic partnership but the extent to which they are present or absent gives an overall indication of whether there is a domestic partnership. If there has been a marriage under traditional Indigenous law and it does not meet the test for marriage described above, the couple may still be recognised as being in a domestic partnership.
If the deceased artist is survived by a spouse or domestic partner and also by children, grandchildren or great grandchildren, then different rules apply depending on the value of the estate:
If the value of the intestate estate does not exceed $100,000, the surviving spouse or domestic partner is entitled to the whole of the intestate estate, including the deceased's personal effects (household items, jewellery etc).
If the value of the intestate estate exceeds $100,000, the surviving spouse or domestic partner is entitled to:
half of the balance of the intestate estate.
The other half of the deceased's estate worth more than $100,000 will be shared between the children or grandchildren (the issue of the deceased).
When the deceased artist has more than one spouse or partner who is still alive?
The Act specifically contemplates that a deceased person may have, at the time of their death, more than one spouse or domestic partner (for example, both a legal wife or husband and a domestic partner)[ii]. This section provides guidance as to how the estate is to be shared if there is more than one spouse.
If an intestate is survived by both a spouse and domestic partner, they each get an equal share of the portion which would have gone to the spouse or domestic partner if there was only one. For example, if there is no issue, they get half each of the whole estate (including the deceased's personal effects).
Where there is a dispute between the spouse and domestic partner over any personal effects of the deceased, the person responsible for administering the estate can sell those effects and divide the proceeds of the sale equally between the spouse and domestic partner.
When there is no surviving partner?
If there is nosurviving spouse or domestic partner but there are surviving children, grandchildren or their children (as determined by the Act), those descendantsare entitled to the whole of the intestate estate in equal shares starting with the surviving children.[iii]
o If the artist had only one child and that child is still alive, that child is entitled to the whole of the intestate estate. If that child passed away before the artist but his or her children (the artist’s grandchildren) are still alive, then they are entitled to the whole (or relevant part) of the intestate estate in equal shares.
o In any other case, the intestate estate is divided by the number of the deceased artist’s children who are either still alive or who predeceased the artist leaving children or grandchildren of their own. Each surviving child is entitled to an equal share of the estate. If a child of the deceased has passed away, leaving a surviving child or children of that deceased child, then those grandchildren are entitled to the share of the estate that would have gone to their deceased parent (in equal shares). This process continues for all direct descendants until the entitlement is exhausted.
For the purposes of the Act, adopted children are considered to be the children of their adopted parents, not their natural parents.[iv] In addition, ex-nuptial children will be treated the same as children born of a marriage. An ex-nuptial child is a child of the artist and a person who was not the artist’s husband or wife.[v] However, a step-child is not considered to be the child of the deceased and thus does not receive any interest in the intestate estate.
What about traditional adoption under Indigenous laws?
Many Indigenous families have children who are adopted under traditional law. Such children will NOT be considered part of that family for the purpose of the intestacy laws.
For the purposes of the intestacy rules, adopted children are only considered to be the children of their adoptedparents, not their natural parents, if the formal processes of the adoption legislation must have been complied with. This includes the adoption being facilitated by the relevant government department or an accredited adoption service provider, consent of each parent of the child being given to the adoption and an adoption order being issued by a court.
This is another good reason to make a will so that all children, including children adopted under traditional law can share in the artist's estate.
When the artist is not survived by a partner or any children, grandchildren or great grandchildren?
Where the deceased is not survived by a spouse or domestic partner or any issue, the deceased's surviving parents (if any) are entitled to the whole estate (in equal shares).
Where the deceased has no spouse or domestic partner, direct descendants or parents, the deceased artist's surviving brothers and sisters (siblings)are entitled to the whole estate in equal shares unless there are siblings who predeceased the artist leaving surviving children (the artist’s nieces and nephews). If a sibling of the deceased has passed away, leaving surviving children (i.e. nieces and nephews of the deceased artist), then those children are entitled to the share of the estate that would have gone to their parent (i.e. the deceased artist's brother or sister) in equal shares (and so forth until the entitlement is exhausted).
If the deceased artist is not survived by any siblings but is survived by nieces and nephews, the intestate estate will be distributed to those nieces and nephews and their issue as if they were the deceased artist’s own children.
Where the deceased has no surviving spouse or domestic partner, direct descendants (e.g. children and grandchildren), parent, or sibling (or their direct descendants), the deceased's surviving grandparents are entitled to the whole estate (in equal shares).
Where the deceased has no surviving spouse or domestic partner, direct descendants (e.g. children and grandchildren), parent, sibling (or their direct descendants) or grandparent, the deceased artist's surviving aunts and uncles are entitled to the whole estate (in equal shares). If an aunt or uncle of the deceased has died, leaving surviving children (the artist’s cousins), then any cousins of the deceased artist are entitled to the share of the estate that would have gone to their parent.
If the deceased is not survived by any aunts and uncles but is survived by the direct descendants of the aunt and uncle (e.g. the artist’s cousins), the intestate estate will be distributed to those cousins as if they were the children of the deceased artist.
Wherethere is no next of kin as described above, the estate is described as 'bona vacanti' and the intestate estate will belong to the State of South Australia. This could happen even though the artist is survived by children adopted under traditional law – they would have no entitlement to share in the estate.
More details about the rules for distributing an intestate estate are set out in Part 3A of the Act, and are summarised in Schedule 1 of this Kit.
The rules for distribution of the property of a person who dies intestate are based on a relatively narrow range of family relationships, and these rules may be inappropriate for Indigenous communities that have a broader concept of family relationships.
Unlike in the Northern Territory and New South Wales, there are currently no legal mechanisms in South Australia that allow Indigenous communities to distribute intestate estates in a different way to that set out in the Act.
Usually funeral arrangements are managed by the family and in accordance with any express wishes of the deceased person. If there is any disagreement within the family, the person appointed to manage the estate makes the final decision.
The family should consider that a very expensive funeral will mean that there is less money in the estate for the beneficiaries. The funeral should not cost more than the estate can afford.
The money required for funeral expenses must be paid before other any debtors are paid and before distributing any money to the beneficiaries.
Where someone dies intestate, someone close to the deceased (often a beneficiary) must take responsibility for the "administration" of the deceased's estate. The administration of the deceased's estate will involve collecting the deceased's assets, finalising certain tax issues and then distributing the assets to the appropriate beneficiaries according to the rules set out above.
For most artists, the most important assets held in the estate are likely to be those set out above namely:
Money held by the art centre from the sale of paintings;
Paintings held by the art centre or a commercial gallery or dealer on consignment;
Copyright (including entitlements to licensing royalties from collecting societies or under licensing deals negotiated during the artist’s lifetime);
Resale royalties; and
Any personal bank account held in the artist’s name.
In this information sheet we only deal with the assets listed above. The person who administers the artist’s estate may also be responsible for other assets such as a house or car owned by the artist.
If a person dies intestate, a person such as a beneficiary wishing to arrange for the administration of the deceased's estate has the following options:
Option 1: The South Australian Public Trustee can be asked to manage the estate.
Option 2: A beneficiary or other personcan apply to the Court to be appointed as the formal administrator of the estate. This is called a ‘Grant of Administration’. The family may prefer that a family member or trusted friend carry out those responsibilities rather than the Public Trustee. A Grant of Administration is necessary where businesses or institutions which hold the deceased’s assets are not be prepared to release them without such a Court order.
Option 3: A beneficiary or other personcan locate the assets and distribute them according to the rules of intestacy without going through the formal process of applying to the Court. This may be possible for smaller estates where there is no real property (land) involved.
Whichever option is chosen, it is very important that all the correct beneficiaries are identified. Schedule 2 to this Kit is a questionnaire that you can fill out and provide to Arts Law. Based on that information, we can advise you who will be the beneficiaries of the deceased artist under the South Australian intestacy laws.
Where there is no one who is able or willing to apply for letters of administration, the beneficiaries can approach the South Australian Public Trustee and ask it to administer the estate.[vi] The South Australian Public Trustee is a statutory authority that is a branch of the South Australian Government.
Document A is a template letter to the South Australian Public Trustee requesting that it administer the estate of the deceased artist. Alternatively, the beneficiaries may contact the Public Trustee by phone on 1 800 673 119.
The South Australian Public Trustee must apply to the Court to be appointed as an administrator of the estate. However, it can do so in a streamlined manner which is quicker than the process an individual must follow because fewer documents are required to be filed.[vii]
The South Australian Public Trustee charges a capital commission of 4.4% for assets up to $200,000 and a flat fee plus percentage commission for estates above $200,000. For example, for estates worth $200,001 to $400,000, the Public Trustee charges $8,800 commission plus 3.3% for every dollar above $200,000. In addition to its standard charges, the South Australian Public Trustee may also incur certain additional costs that must be paid out of the estate (known as disbursements), such as court filing costs, or the cost of obtaining a Death Certificate. However, the Public Trustee has discretion to reduce or waive its fees for reasons of hardship or in cases involving minimum assets.
The South Australian Public Trustee specifies an average period of about 4 to 8 months for settling an estate. It is worth noting, however, that more complicated cases can sometimes take years to be complete.
Once the South Australian Public Trustee has received the grant of administration, it takes legal responsibility for ensuring the estate is administered properly. The South Australian Public Trustee would become responsible for arranging the sale of the art works and collecting the proceeds of sale.
Where the deceased had an agreement with an art centre under which the art centre was entitled to sell and retain commission on works painted at the art centre, the South Australian Public Trustee may be obligated to continue those arrangements put into place during the artist’s lifetime. Even where there is no such arrangement, the South Australian Public Trustee is generally keen to administer estates in the most beneficial way possible, and may be willing to allow the art centre to arrange for exhibitions and sales of unsold artworks to ensure that they get the best possible price.
An Indigenous artist has passed away. She is survived by her husband and her three children. Her estate contains the following property:
Altogether, this estate is worth $100,000. Under the intestacy rules, the whole estate goes to her husband.
If there were no difficulties or complexities encountered, the Public Trustee's charges for administering such an estate would probably be about $4,400, plus disbursements. The Court filing fees would be $995.00.
If any complexities were encountered, for example if one of the children couldn’t be found, the Public Trustee's charges would increase, depending on how long these tasks took.
For more information about the Public Trustee’s role generally, see the Public Trustee’s website.
Option 2: A family member can apply to the Supreme Court to be appointed as the formal administrator of the estate
If a particular person or persons, such as a beneficiary, wishes to be responsible for the administration of the estate, they can apply to the Court to be formally appointed as the 'administrator' of the estate. If successful, this is known as a 'Grant of Letters of Administration'. It is preferable that the person or persons applying to be the administrators of the estate have the consent of all the beneficiaries (as identified by South Australian intestacy laws) to do so.
Applying for the authority to administer the deceased's estate can involve costs and can be a complex and time-consuming process. To avoid some of these costs and effort, the South Australian Public Trustee can be asked to administer the estate. This can sometimes be a quicker and cheaper process. More about this process is set out above at Option 1.
Before it will grant letters of administration to someone, the Court must be satisfied that the applicant is an appropriate person to be appointed as the administrator. The Court generally will not grant the right to administer a deceased's estate to a person unrelated to the deceased (such as an art centre) when there are spouses, children or other next of kin who can be identified and are living in South Australia. However, if there is no family member willing to apply, the Court may appoint someone else.
When hearing an application by a family member, evidence of there being a family relationship would usually be given in the form of an affidavit. An affidavit is a written statement provided to the Court under oath. If there is a basis for challenging affidavit evidence, the Court may require further proof of identity. A chain of birth certificates is the best means to prove a family relationship. If this record is not available, other forms of identity may assist in proving the relationship, for example Medicare records, marriage certificates, car registration documents, a drivers licence or bank records. Similar proof of identity may be required in identifying beneficiaries.
In some circumstances, it may be necessary for a genealogical report to be prepared. This is usually an expensive process.
Procedure for applying for grant of administration
In order to make an application for a grant of letters of administration, the procedure set out below must be followed.
The Supreme Court website gives access to the prescribed forms, filing fee structure, current legislation, rules of procedure and other information.
The forms usually required for administration where there is intestacy are form numbers 5, 51, 52, 55, 68 and 70. These forms must be filed at the Court's Registry:
Form 5 - Affidavit of justification of sureties with attached back sheet.
Form 51 - Draft Grant of letters of administration with attached back sheet - sets out the details of the estate and the person to whom the letters of administration are granted. This document is then sealed by the Supreme Court and returned to the solicitor for the applicant.
Form52 - Administrator's Oath with attached back sheet
Form 55 - Sureties Guarantee with attached back sheet - requires the applicant for letters of administration, together with two 'sureties' or guarantors to lodge a bond or guarantee that the administrator will do the work of administering the estate properly. This is not required if the gross estate is less than $50,000 and, where the applicant is the spouse of the deceased, only one surety is required. In special circumstances, this bond can be avoided.
Form 68 - Affidavit of Assets and Liabilities
Form 70 - Registrar's Certificates - no back sheet
In most cases, the help of a solicitor will be necessary to prepare these documents (which may accrue solicitor's costs). The process of preparing all the necessary documents for filing with the Court, applying to the Court and satisfying any requisitions from the Court may take some time.
Letters of administration cannot be granted earlier than 28 days after the death of the deceased except with express permission of the Court or Registrar.[viii] There is no time limit on making an application to the Court for a grant of letters of administration. Completed forms may be either typed or in legible print. In addition, you will need to file the will (if there is one), death certificate and any other relevant certificates, as appropriate. Original documentation must be presented to the court and will not be returned to the applicant.
Part of the application for Letters of Administration includes valuing the estate. This may be difficult in respect of some of the deceased's assets. Assets should be valued at the date of the deceased's passing. While the value of the artwork still owned by the artist may increase in the future, it is the current value which needs to be considered in valuing the estate.
The application should also identify the potential for the estate to earn income from resale royalties and licensing or sale of the copyright in the artwork (if still owned by the deceased at the time of passing). Although that asset cannot at the time be valued, it is an asset that needs to be distributed in accordance with the rules of intestacy. Value can be given to the copyright if it is subject to a licensing agreement at the time of the deceased's passing and the licensing agreement should be considered in making the application.
There is a filing fee payable for lodging the documents necessary for obtaining the grant at the Supreme Court registry. Fees are subject to change so it is wise to consult the website or telephone the Court for details. For example, in 2011-12, a grant of probate or administration costs $995. Usually the Registrar of the Supreme Court has the power to waive this filing fee if financial hardship of the person applying can be demonstrated. Contact the South Australian Supreme Court on (08) 8204 2444 for details.
The completed application must be filed with the Court in person between 9.30 am and 10.30 am on business days. According to the Supreme Court, once an application has been filed with the Court it will be examined and processed within one working day. If it is in order the grant will be made and the parchment prepared and mailed to you. If the application is not in order, further requirements are raised at the time of examination and will be mailed to you for answering.
If the application is successful, the administrator of the estate has the legal right to deal with the assets of the estate, including the right to provide instructions in relation to the sale of art work and to collect money owed to the estate. The administrator can usually obtain reimbursement from the assets of the estate for any costs, expenses or fees associated with the administration of the estate (such as the costs of the application to the Supreme Court).
After payment of funeral expenses and the deceased's debts, the administrator must distribute the remaining assets to the beneficiaries within a reasonable time. An administrator has the same rights as a person administering the estate under a will (known as an "executor").
The administrator can provide an art centre or bank holding money or property belonging to the estate with a certified copy of the grant of letters of administration and a signed receipt. Upon payment of money or the transfer of any property to the administrator, the administrator becomes legally responsible for such funds or property and for ensuring the estate is administered properly. The art centre or bank is relieved of legal responsibility to look after those funds or that property.
The administrator can also receive resale royalties or licensing fees for distribution to the beneficiaries. Alternatively, the administrator can notify the collecting society of the persons to whom those royalties should be paid.
The administrator may need to file a tax return for the estate. The position of administrator involves substantial responsibility and liability for any improper distribution, or for distributing assets while creditors remain unpaid.
Option 3 – Administration of the estate in accordance with the terms of the Will without applying to the Supreme Court
Given the complexity, cost and time involved in Options 1 and 2, the beneficiaries of the estate may prefer not to proceed through the formal process of applying for a Court order or involving the South Australian Public Trustee. An alternative is for the family to administer the estate informally, without applying to the Supreme Court.
Administration of the estate in accordance with the rules of intestacy without applying to the Supreme Court
This option will only be possible if those holding property or money on behalf of the estate (such as a bank or art centre) do not insist on sighting a Court order granting rights of administration before they will release the property or money belonging to the estate. In other words, the bank or art centre must be prepared to transfer the property or release the money to a family member who is not a legally appointed administrator of the estate. It is worth noting that it is unlikely a bank or other organisation will release property of medium-to-high value without first sighting a grant of administration. Therefore, this option is most appropriate if the estate is small or uncomplicated.
The first step in this informal approach is to identify which family members are entitled to the deceased artist’s assets according to the rules of intestacy (ie the beneficiaries). To do this, you can refer to the summary of the intestacy rules at Schedule 1 and the questionnaire in Schedule 2, and you can request help from the Arts Law Centre.
Who should take charge?
Once the beneficiaries have been identified, they will need to come to an agreement about how to proceed. The beneficiaries should authorise one or two people to be the ones who will contact the organisations holding assets that are part of the artist’s estate.
Document B is a suggested authority that the beneficiaries could sign nominating who will act on behalf of all of them. This document can be used to demonstrate that all the beneficiaries agree.
Does the estate need its own bank account?
It is usually sensible to set up a bank account for the estate. This is not a personal account for the beneficiaries and must not be used for anything other than the business of managing the estate. The name of the account will be the words “Estate of...” followed by the name of the deceased artist. This account can be used for depositing any funds owed to the estate such as resale royalties or sales proceeds from artwork. It can be used to pay any debts such as taxes or credit card amounts. Once all expenses have been paid, the remaining funds in this account can be paid to the beneficiaries in the shares specified by the intestacy rules. Once all the distributions have been made, the account can be closed.
In some cases, it may be possible to discuss with the art centre whether its account can be used for the purposes of the estate. This will save the beneficiaries setting up a separate account. The art centre may not be comfortable with this approach. Even if it does agree, the art centre manager will want to receive confirmation as to the correct distribution under the intestacy rules and may require written instructions from the beneficiaries before making any payments.
In the rest of this information sheet, we assume that the estate has its own bank account; however the information set out below would also apply if the estate’s funds were held in the art centre account.
How do the beneficiaries get hold of the assets in the estate?
Set out below are some suggestions as to how the beneficiaries can approach the different organizations who hold the various assets if the deceased's estate is to be administered informally.
a. Personal bank account held in the artist’s name.
A bank may release funds in a deceased person’s bank account to the beneficiaries if those funds are not substantial.
Document C is a suggested template letter to send to the bank. Preferably it would attach a copy of the death certificate and any authority the sender has to represent other beneficiaries, as well as the most recent statement or the passbook and chequebook, if any.
The bank may require the beneficiaries to go in to a branch and prove their identity by producing, for example, a driver’s licence or passport. Once the bank account can be accessed, it should be used to pay any outstanding funeral expenses. Otherwise the money should be kept until it is clear how the estate will be distributed among the beneficiaries. Before allowing access to the account, the bank may request that the beneficiaries sign an "indemnity" document, which can mean that you are liable for any losses the bank suffers as a result of its decision to release the funds to you. If the bank requests that you sign such a document, you should seek legal advice. The Arts Law Centre can provide you with help in this respect.
b. Money and paintings held by an Indigenous art centre where the artist was a member.
Most Indigenous art centres operate on the basis of an agreement with their artist members that entitles the art centre to a share of the sales proceeds of any artworks made through the art centre (such as art made using canvases and paints supplied by the art centre). In that case, after the artist passes away, the art centre is generally entitled to arrange the sale of all paintings and artwork created by the artist with the assistance of the art centre. In such cases, the beneficiaries cannot give the paintings to another gallery or auction house to sell without the consent of the art centre and cannot keep any of that artwork for themselves unless the art centre agrees. In such cases, the simplest approach is for the art centre to sell the paintings in its possession and (after deduction of its share of the proceeds) deposit the funds into the estate’s bank account, as well as any other moneys held for the artist in its account.
If the beneficiaries are unsure as to nature of the deceased artist’s arrangements with the art centre, it is important to get legal advice. The Arts Law Centre can help with this.
If the art centre is confident that it is dealing with the proper beneficiaries of the deceased's estate, it may be prepared to sell the paintings in its possession and give the money (after deduction of its commission and payment of the funeral expenses and other debts) to the beneficiaries as well as any other moneys held for the artist in its account.
If the estate doesn’t have its own bank account, the art centre may be prepared to sell the paintings in its possession and hold the money received from those art sales on trust for the estate in the art centre’s own account. The beneficiaries can provide a written instruction to use those funds to pay funeral expenses and other debts. If the art centre is confident that it is dealing with the proper beneficiaries of the deceased's estate under the intestacy rules, it may be willing to pay the balance directly to the beneficiaries.
Document D is a suggested template letter to send to the art centre.
There are some risks for the art centre (and anyone else who hands over property where letters of administration have not been obtained) associated with pursuing this course of action, including the following:
As there is no formally appointed personal representative of the estate, the art centre cannot transfer legal responsibility for distribution of funds of the estate. It may be legally responsible if it gives property to the wrong people, for example if a will is found later or the artist had another child which the art centre didn’t know about and who didn’t get a share.
If the artist had any outstanding debts, then the creditors may be entitled to the funds rather than the beneficiaries. The art centre could be responsible if it pays the beneficiaries when there are debts owing to others.
If the art centre hands over the funds to one family member and that person doesn’t correctly share the funds with the other beneficiaries, the art centre could be legally responsible.
If the art centre (or other business) is concerned about these risks, it may reduce those risks (although not completely) by one or more of the following:
Obtaining a signed document from each of the beneficiaries receiving the money that expressly states that they have waived their rights to apply for letters of administration and they indemnify the art centre against any claims or losses arising from the payment of money to them in such circumstances. However, this has significant risks for the persons signing that indemnity. The Arts Law Centre can help you prepare such a document if it is required.
Placing an advertisement in a publication likely to be accessed by people who might have an interest in the estate to ensure that the correct beneficiaries have been identified
Document E is a suggested form of advertisement.
Arts Law recommends that the art centre obtain and keep copies of receipts for any amounts paid to beneficiaries.
c. Money and paintings held by a commercial gallery or dealer.
Any arrangement between the artist and a commercial gallery or dealer is likely to be terminated upon the artist’s death. The beneficiaries are entitled to ask for the paintings to be returned and any amounts due to be paid into the estate’s bank account. The beneficiaries might do this if it is decided to collect all the artist’s works together and arrange for one major retrospective after a suitable period of time has passed.
Document F is a suggested template letter to send to a gallery or dealer asking it to return any unsold works and make any payments due.
Alternatively,if the beneficiaries decide that the best way to manage the assets is to proceed with that particular exhibition or consignment arrangements, they can request the gallery or dealer to sell the paintings and to pay the proceeds into the estate’s bank account or, once all debts are paid, directly to the beneficiaries in the shares specified in the intestacy rules.
Document G is an alternative template letter to send to a gallery or dealer asking it to proceed with the exhibition and sale arrangements which were planned during the artist’s lifetime.
If the gallery or dealer does not agree, the beneficiaries should seek legal advice. It may be necessary to obtain a Grant of Letters of Administration.
d. Resale royalties
For information about the resale royalty right, see Arts Law’s information sheet: Resale royalty rights for visual artists.The organization nominated by the Federal government to manage the resale royalty scheme is Copyright Agency and further information can also be found on the Copyright Agency website.
Copyright Agency also manages the statutory copyright royalties payable to copyright owners where artworks are reproduced in certain types of government and educational publications such as educational materials (both hard copy and online). See the Copyright Agency website. For convenience, because Copyright Agency manages both types of royalties, we will deal with both in this section.
Contact Copyright Agency to find out if the deceased artist was registered for resale royalties (and/or statutory copyright royalties) on its tollfree number: 1800 066 844. Email: email@example.com
If the artist is registered with CAL and the accumulated statutory royalty due is $10,000 or less, CAL will generally be prepared to pay future statutory royalties directly to the artist's beneficiaries in the following circumstances:
a. if the artist was a member of an Indigenous art centre, a letter from the art centre is provided which confirms that:
(i) the date of death;
(ii) that the artist was a member of the art centre;
(iii) that the artist had no will and that no one has applied for letters of administration
(iv) providing details of the names, relationship to the artist and contact details for all known surviving members of the artist's family
Document H is a letter from the artist’s art centre to Copyright Agency requesting registration of the estate for resale and statutory royalties. There are two options – registration of the beneficiaries individually or registration of a copyright trustee.
b. if the artist was not a member of an art centre, documents are provided which confirm:
(i) the date of death;
(ii) that the artist had no will and that no one has applied for letters of administration;
(iii) providing details of the names, relationship to the artist and contact details for all known surviving members of the artist's family;
(iv) evidence to the entitlement of the relevant family members to royalties such as evidence of advice from Arts Law or the Public Trustee.
Document I is a suggested template letter and statutory declaration that can be used instead of the art centre letter if the artist was not a member of an art centre.
In all other circumstances, CAL will not usually pay statutory royalties to beneficiaries without a grant of letters of administration.
Each applicant for registration (whether a beneficiary, copyright trustee or executor) will also need to complete the Registration Form for Artist’s beneficiaries available on the Copyright Agency website and submit it with the letter or statutory declaration. If more than one beneficiary is entitled to be registered, then one form needs to be completed for each beneficiary. The forms should be sent in together with a copy of the Will and evidence of the identity of the person or persons seeking registration.
If the deceased artist was not a CAL member during his or her lifetime, the first step is register the artist's estate with CAL and then follow the steps above.
e. Copyright, including entitlements to licensing royalties from collecting societies or under licensing deals negotiated during the artist’s lifetime.
The beneficiaries are entitled to share the artist’s copyright in the way set out in the intestacy rules. The Copyright Act automatically vests the ownership of the artist’s copyright in the beneficiaries according to the intestacy rules.
Managing the copyright involves negotiating licence agreements and claiming royalties when the deceased artist’s work is reproduced. Without a Grant of Administration for the estate, it is likely to be very difficult to assert any claim for royalties arising out of the copyright in the deceased’s artwork. It will also be difficult to negotiate any future copyright licences. Unless the copyright trustee or the beneficiaries have the time and expertise to manage this, Arts Law recommends that they register the deceased artist’s copyright with the appropriate collecting societies so that the beneficiaries can receive an income stream from copyright licensing opportunities. For information about collecting societies generally, see Arts Law’s information sheet: Copyright Collecting Societies.
A well-known Aboriginal artist has passed away. His works have been featured in books and films and he earned substantial copyright royalties during his lifetime. The estate is worth approximately $150,000. His wife passed away many years earlier. He is survived by his four children and under the intestacy rules, the estate must be shared among them equally. The family agree that his eldest daughter should manage the estate. She registers the estate with Viscopy and instructs them that all royalties must be divided equally among the four beneficiaries.
The National Gallery of Australia wish to conduct a major retrospective of the artist’s work which will involve showing films of him painting and publishing a hardcover collectors’ catalogue. Viscopy negotiates all the licensing agreements with the National Gallery including airfares for the family to attend the opening of the exhibition. Viscopy collects the royalties on behalf of the family and distributes them to the four beneficiaries. The following year, the films are broadcast on SBS and further royalties are paid to Screenrights which then distributes them to the four beneficiaries.
AAA and Screenrights deduct a commission from the royalties they collect. The beneficiaries do not have to negotiate or agree licensing arrangements among themselves. They do not need to spend money on a lawyer to help them with the copyright licensing contracts. This is included in the commission charged by the collecting society.
The beneficiaries will need to prove their ownership in order to register themselves with any collecting society. This means they will have to show how the intestacy rules apply to the artist’s family.
Some families may decide to nominate one person as the ‘trustee’ of copyright with an ongoing responsibility to manage the copyright on behalf of a group of beneficiaries. This responsibility can continue well after all the other assets in the estate have been shared out among the beneficiaries.
This information sheet gives some guidance below about how to deal with the different collecting societies that might be relevant to the copyright of a visual artist.
If the artist was a member of an art centre, the first step should be to contact the art centre to ask whether it had registered the artist with any collecting societies. If so, it may be that copyright royalties were paid into the art centre’s account.
In all other situations, the beneficiaries will need to contact each collecting society directly and:
- Find out if the artist was registered;
If so, advise that the artist has passed away intestate;
Find out which bank account the artist was using to receive royalties and make sure that any money in this bank account is included in the estate.
Update the registration details to register the beneficiaries as the new owners of copyright or, alternatively, to register a copyright trustee.
i. Copyright Agency Limited:
See the section on Resale Royalty above for information on approaching Copyright Agency about registering the artist’s estate for payment of the statutory royalties payable to copyright owners where artworks are reproduced in certain types of government and educational publications such as educational materials (both hard copy and online). See the Copyright Agency website.
If the artist wasn’t registered then the beneficiaries can apply for membership with Copyright Agency online or using the attached form. Beneficiaries should mark the box “Owner of copyright in works created by Artist”.
Viscopy can manage non-statutory or voluntary copyright licensing for the beneficiaries of the deceased artist’s estate. For example, businesses that want to use copies of the deceased artist’s artworks in books, on websites, greeting cards and posters, in newspapers, magazines, television, exhibition catalogues, merchandise, advertising and film can approach Viscopy for a license. If the artist’s estate is registered with Viscopy, Viscopy will negotiate a royalty for that use and, after deducting its fee, will pay the remainder to the persons registered as the artist’s beneficiaries. For information, see Viscopy’s website.
Viscopy can also distribute the resale and statutory royalties collected for the artist’s estate by Copyright Agency. However commission will need to be paid to both Copyright Agency and Viscopy for this service and Arts Law recommends that artists and their families only register with Viscopy for non-statutory royalties and register directly with Copyright Agency for resale and statutory royalties.
The beneficiaries can contact Viscopy on its tollfree number: 1800 649 901.
Viscopy's policy in the situation where an artist has passed away is to work with the families on a case by case basis. You will need to discuss with Viscopy how you should proceed to arrange for payments to go to the beneficiaries. Viscopy is likely to require information which confirms:
the date of death;
that the artist had a Will,
details of the names, contact details and bank account details for the executor,the copyright trustee (if applicable) and the beneficiaries.
If the artist was not registered with Viscopy, the artist may have been registered instead with AAA. If not, then Arts Law recommends that families enquire as to how the beneficiaries can become registered with Viscopy (or AAA) for non- statutory royalties.
iii. Aboriginal Artists Agency Limited (AAA):
AAA represents over 300 Indigenous artists from the Central desert and Arnhem Land areas by providing similar copyright licensing services to those provided by Viscopy. If the deceased artist was registered with AAA, AAA will usually be willing to continue to manage non-statutory licensing for the beneficiaries. Businesses that want to use copies of the deceased artist’s artworks in books, on websites, greeting cards and posters, in newspapers, magazines, television, exhibition catalogues, merchandise, advertising and film can approach AAA for a license which will negotiate a royalty for that use and, after deducting its fee, will pay the remainder to the persons registered as the artist’s beneficiaries. For information, see AAA’s website.
Contact Anthony Wallis at AAA by phone:0417 230 464 or email: firstname.lastname@example.org find out if the deceased artist was registered for copyright royalties. If the artist was not registered, Arts Law recommends that families enquire as to how the beneficiaries can become registered with AAA (or Viscopy) so that it can manage the deceased artist’s copyright for non- statutory royalties.
AAA generally deals with the situation where an artist has passed away on a case by case basis. It will normally require information which confirms:
the date of death;
that the artist had no will,
details of the names, contact details and bank account details for the next of kin under the intestacy rules.
Screenrights manages statutory copyright licences for certain uses of audio-visual works (film and video) including uses by government and educational institutions. Often an artistic work such as a painting or sculpture may appear in a film or television broadcast and the owner of copyright in that artwork will share in any royalties collected by Screenrights for the use of that film. For more information see the Screenrights website.
If you know that artworks by the deceased artist appeared in a film or television broadcast, contact Screenrights’ Member Services Departmentto find out if the deceased artist was registered for statutory royalties. Telephone: 02 9904 0133 or email email@example.com.
Screenrights can also distribute the statutory royalties collected for the artist’s estate by Copyright Agency. However commission will need to be paid to both Copyright Agency and Screenrights for this service and Arts Law recommends that artists and their families register directly with Copyright Agency for statutory royalties.
Screenrights will not necessarily require a Grant of Letters Administration in order to update registration and payment details for the estates of Indigenous artists. The executor should discuss with the Member Relations Manager how to proceed to arrange for payments to go to the copyright trustee or the beneficiaries.
Document J is a letter from the art centre to the collecting societies (other than Copyright Agency) advising them that the artist has passed away and asking them to continue paying royalties into the art centre account.
v. Other licensing arrangements:
If there are other licensing deals that were negotiated during the artist’s lifetime without involving a collecting society, the beneficiaries need to decide whether those contracts can and should be terminated or whether they should continue. We recommend that the beneficiaries get legal advice as to whether each licence is a sensible and commercially reasonable arrangement or whether it should be terminated.
Document K is a template letter requesting the licensee to pay any royalties to the beneficiaries in the future.
The artist had a licence with a souvenir business to use three artworks on stationery and gift cards. The artist passed away without a will. The only beneficiaries were the artist’s three children. The children agreed that they would each take copyright in one of the three works. The souvenir business agreed to pay royalties on the first artwork to the artist’s eldest son, on the second artwork to the second son and on the third artwork to the artist’s daughter.
The artist also had a licence with a hotel for the use of an artwork on its website. The hotel wouldn’t agree to pay the royalties in three shares or deal with the beneficiaries. However the beneficiaries registered the artist’s estate with Viscopy. The hotel agreed to licence the artwork through Viscopy. Viscopy then distributed the royalties to the three beneficiaries after deducting its commission.
If the licensee does not agree, seek legal advice as to whether the licence should be terminated. It may be necessary to get a Grant of Administration in order to deal with these licences.
f. Insurance policies and superannuation funds
Some types of insurance or superannuation policy will include provision for a named beneficiary in the event of the death of the policy holder and may therefore not be covered by the intestacy rules.
The beneficiaries should contact the insurance company or superannuation fund to find out what steps need to be taken in order for any funds to be paid out to the beneficiaries. In many cases, the trustee of the fund will have the discretion to release the funds directly to the named beneficiaries without a Grant of Administration.
g. Nursing home accommodation bonds
The beneficiaries will need to contact the nursing home to enquire what information it requires in order to release any accommodation bond or accrued social security payments. In some cases, nursing homes will require a Grant of Administration.
As can be seen from the above, there are a number of things to think about when managing the affairs of a deceased artist who made a will before passing away. The Federal government has some helpful information on its website - What To Do Following a Death.
Set out below is a checklist of matters to consider when embarking on one of the options outlined above:
a. Make sure there is no will.
b. Establish who the beneficiaries of the estate are when there is no will. Contact the Arts Law Centre if you need help with this.
c. You will probably need one or more certified copies of the Death Certificate. The official Death Certificate should be photocopied several times. You can then take those copies to the local police station and ask them to endorse them as certified copies.
d. If the artist was receiving any benefits from Centrelink, advise Centrelink that the artist has passed away.
e. If the artist had a car or a driver’s licence, advise the Transport SA that the artist has passed away.
h. What did the artist own at the date of passing away?
- Bank account
- House or property
- Personal belongings
- Shares, life insurance, superannuation
i. Was the artist a member of an art centre? Which one? Do they hold any money or paintings belonging to the artist?
j. Are there any art galleries holding works of the artist for exhibition and sale? Do you have contact details for them?
k. Did the artist have any agreements or licenses about the use of his/her art? If so, can you provide any details?
l. Did the artist get royalties from Viscopy or Copyright Agency? Is the artist registered for resale royalties?
m. Have all the funeral expenses been paid? If so, who paid them? If there are outstanding debts associated with the funeral, any funds must first be applied to the payment of those before any distribution to the beneficiaries.
n. What other debts did the artist have? These must be paid before any distribution to the beneficiaries.
o. Find out if the artist needs to file a tax return. If there is any tax owing, that must be paid before any money can be distributed to the beneficiaries. Many Indigenous artists were considered to be "hobbyists" by the Australian Tax Office and while alive did not have to complete tax returns dealing with income earned from their art. If that is the case then it will not be necessary to file a tax return for the period up to the date of death. However, in relation to any money earned by the estate from sales of artwork after the artist's death, tax may be payable.
[i] If the deceased artist’s spouse or domestic partner passes away within twenty eight days, the intestacy rules operate as if the spouse or domestic partner did not survive the deceased, and the estate is distributed as though there was no spouse or partner.
[ii] Administration and Probate Act 1919 (SA) section 72H
[iii]Administration and Probate Actsection 72I
[iv]Adoption Act 1988(SA) section 9
[v] Family Relationships Act 1975(SA) section 6
[vi]Public Trustee Act 1995(SA) Section 15
[vii]Part 3 of the South Australian Supreme Court Probate Rules
[viii] Rule 10.03 of the South Australian Supreme Court Probate Rules