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Deceased Estates

The loss of a loved one is a traumatic event. When a person dies, all is not over with the burial.

The deceased’s affairs have to be finalised and this is what is known as winding up of the estate. The winding up of an estate is a long and drawn out process and the object of this article is to give people an idea of what is involved and why it takes so long.

TESTATE and  INTESTATE Estates

Estates may be divided into two categories, testate estates and intestate estates. A testate estate is where a person leaves a Will and the estate is wound up in accordance with the Will. An intestate estate is where there is no Will and the estate is wound up according to the Laws of Intestacy which is a set of legal rules which works out who is to inherit the estate according to a formula.

A Will in Summary does two things:

  • it nominates an executor, and
  • it gives instructions as to what is to happen to the estate.

If there is no Will then the Master of the High Court will decide on the appointment of an executor and the estate will be wound up in accordance with the Laws of Intestacy. There is a misconception that if a person does not leave a Will, the estate goes to the Government. This is incorrect. This will only happen if a person does not have any intestate heirs, which is something that very rarely happens.

The Winding up Process

On the death of a person, anyone in possession of that deceased person’s Will is under an obligation immediately to send it to the Master of the High Court.

From here, the steps involved in winding up of an estate are outlined as follows:

1. Appointment of executor.
2. Advertising for creditors.
3. Preparation of the estate accounts.
4. Advertising of the estate accounts.
5. Distribution of the estate.

These aspects will now be considered in more detail.

1. Appointment of Executor

When a person dies his estate is frozen. The Master of the High Court will appoint an executor once certain formalities have been complied with. The Master will require certain documents to be sent to him which will include the Will, if any, and certain statutory forms, one of which gives details of the assets of the deceased and another which gives personal particulars with regard to the deceased. The original Will also has to be sent to the Master. If the person nominated in terms of the Will meets the Master’s requirement for appointment as executor, then that person will be appointed as executor. If not, or if there is no Will, the Master will call for written nominations by interested parties and having received the nominations will thereafter make a decision as to whom he will appoint as executor and thereafter appoint that person as executor. In most cases the Master will follow the heirs’ recommendations.

2. Advertising for Creditors

Once the executor has been appointed, he places a notice in a newspaper and in the Government Gazette calling upon creditors to lodge their claims and debtors to pay their debts within thirty days of date of publication. Very few people respond to the notice and accordingly during this period the executor will be making further enquiries into the affairs of the deceased and will be writing to known creditors and debtors to obtain statements of balance and payment of any claims due to the estate and will obtain valuations of all relevant assets in the estate. If sufficient funds are on hand the executor will, at this stage, make payment of the debts due by the estate.

3. Preparation of the Estate Accounts

Once the executor has all relevant information, and after the thirty day period referred to in paragraph 2 has expired, he will prepare what are known as estate accounts. These accounts list all the assets in the estate and their value, detail all debts owing by the estate, including the cost of winding it up, detail who the heirs are and what each heir is entitled to and also detail the estate duty position of the estate.

Once the estate accounts have been prepared and signed they are sent to the Master of the High Court who examines them and who may raise certain queries and perhaps call for certain additional information. Once the Master’s preliminary requirements relating to the estate accounts have been dealt with the Master will authorise the estate accounts to be advertised.

4. Advertising of Estate Accounts

A notice is placed in a newspaper and in the Government Gazette notifying all interested parties that the estate accounts will be available for inspection for a period of twenty one days at the offices of the Master of the High Court and at the offices of the Magistrate in whose magisterial district the deceased was ordinarily resident during his lifetime. During that period of time, any person whatsoever is at liberty to inspect the estate accounts. If any person feels that the estate accounts are wrong then that person should lodge an objection with the Master of the High Court. On receipt of any objections the Master will refer the objection to the executor for comment and once the executor has commented on the objection, the Master will make an appropriate decision with regard to the objection.

5. Distribution of the Estate

If no objections have been lodged or, if objections have been lodged, then once the objections have been disposed of, the Master of the High of the Court will authorise the Executor to distribute the Estate. Once the Executor has received the Master’s authority, the Executor will then transfer any immovable property to the heirs, deliver any movable assets, transfer shares and pay over cash bequests.

Once this has been done the Executor has to lodge with the Master vouchers in respect of the assets, vouchers and proof of payment in respect of the liabilities and proof of delivery of assets and payment of bequests to heirs.

Once the Master is satisfied that the Estate has been properly and completely wound up, he will authorise the Executor to close his file.

Timing

From the above it can be seen that the winding up of an estate is a complex and time consuming procedure.
It normally takes between 6 to 9 months to complete the winding up of an estate.

Legal Topics

For the information of our clients, we have prepared articles on certain aspects of law that may be of interest. Please note that these are not detailed expositions of the law but are for information and interest only. Please obtain professional advice before you act in any way.