From PEOPLE Magazine Click to enlarge
In the months after Heath Ledger's death last January, two of his uncles publicly insinuated that his daughter Matilda wouldn't receive her rightful inheritance—claims Ledger's father, Kim, adamantly denied. Now, Kim is making good on his word. On Sept. 28 he announced, "Our family has gifted everything to Matilda."

Despite concerns that she would be overlooked, "There was never any question that Heath's estate"—estimated to be worth millions—"would go to Matilda," Kim Ledger told PEOPLE, adding that the family's decision "was made the moment Heath passed away." While the legalities of doing so took "a bit of time," says Kim, who just returned to Australia after a two-week visit with Matilda, 2, and mom Michelle Williams in New York City, "now that's all been done." A source close to Williams says the actress always knew that Kim "was making sure that she and Matilda would be taken care of. She's happy about it and she's happy for Matilda."

Williams and Kim aren't the only ones looking out for Matilda. The estate's trustee, attorney John LaViolette, filed suit Aug. 21 against ReliaStar Life Insurance Company for nonpayment on Ledger's $10 million policy. "They want to investigate whether the death was by suicide, which would allow them not to pay," says William Shernoff, who represents LaViolette, adding that the New York City coroner already concluded Ledger's drug overdose was accidental. ("We have not yet rendered a decision on this claim," says ReliaStar spokesman Dana Ripley.)

For her part, Williams, 28, continues to quietly raise her daughter in Brooklyn, occasionally stepping out for appearances like the Sept. 27 premiere of her new movie Wendy and Lucy. And her new relationship with director Spike Jonze is still going strong. "They seem really happy together," says a source. "She's just living her life."

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  • With Melenie Ambrose/Perth,
  • K.C. Baker/New York City.