Disposing of property after death
You may not be able to 'take it with you' when you die, but at least you can decide who gets your accumulated assets. This, of course, means that you have to draw up a valid will.
If you die without leaving a will drawn up as required by law, you are said to die 'intestate' and the rules of intestate succession will determine who acquires ownership of the property you leave behind. (See intestacy.)
Most people leave a will setting out what should happen to their assets. With some limitations, you can leave your property to practically anyone in a will. If you wish, and subject to the Maintenance of Surviving Spouses Act, 1990, and maintenance for minor children, you can leave your entire estate to the Society for the Prevention of Cruelty to Animals or another charity of your choice and leave nothing to your children or spouse.
More important is the fact that by drawing up a will you can arrange for your assets to be distributed among your relatives or friends in the proportions of your choice rather than those laid down by the rules of intestate succession.
The rules in intestacy, for example, give the surviving spouse limited rights, whereas many people prefer to leave their entire estate to their surviving spouse to deal with as he or she may wish. You can, for example, also leave specific property to a specific person in a will - unless you specify who is to inherit what, you cannot be certain of that outcome.
There are other advantages in having a will. If you die leaving a will, your assets must be collected, your debts paid and the balance paid in terms of your will to your heirs and legatees. This is the executor's job and a deceased estate, whether testate or intestate, must have an executor. If the value of a deceased estate does not exceed R250000, the Master of the High Court may dispense with the appointment of an executor and give directions as to the manner in which such an estate is liquidated and distributed. (Sect 18(3) of the Administration of Estates Act 66 of 1965).
If the estate is intestate, the Master will appoint an executor - usually the surviving spouse. An executor appointed by the Master is called an executor dative, whereas one appointed in a will is an executor testamentary. A valid will, in most cases, will name an executor. When deciding on an executor testamentary, you can appoint a money-wise family friend or relative to undertake this task.
You can choose whoever you like to look after your affairs, pay your debts and then distribute the remaining assets among the heirs named in your will. If you wish, you can appoint one or more persons to act as your executor(s) testamentary. An executor, whether testamentary or dative, must have proof of appointment and this proof is issued by the Master of the High Court in the form of letters of executorship.
Warning - Appointing an Executor
Many banks and other financial institutions who offer to assist their clients make a will, tend to persuade the maker of the will to appoint the institution as executor. However, especially for smaller estates, this is often not advisable. The institution will be legally entitled to the executor's fee, which is 3,5 per cent of the gross value of assets and 6 per cent of any income accrued after the date of death.
It is usually better to appoint as executor, one of the beneficiaries of the will who will receive the executor's fee in addition to a bequest. Even if such an executor appoints an attorney to look after the legal formalities, he or she will, by arrangement with the attorney, still receive a share of the executor's fee.
When the estate is valued at under a certain amount, the figure being published in a government gazette, its administration is greatly simplified, as the Master will issue a directive enabling the executor to transfer to his or her own account the assets of the estate for distribution. Currently the amount is R250 000.00.
Making a will
Because it is the only document you will ever sign that comes into effect after your death, it is vital to ensure that your will lists all your wishes in a clear and unambiguous way. It is equally important to remember that a will must also meet all the legal requirements laid out in the Wills Act, 1953, as amended in 1954 and 1965. When you draw up your will, it is therefore advisable to seek expert advice from an attorney or from the trustee department of a bank.
Thousands of Rands may be squandered if, after your death, your heirs are involved in expensive litigation in an effort to clarify what you meant by a particular clause. Expert advice is not as costly as is generally believed and it will reduce the possibility of ambiguities that may require interpretation by the courts.
While an attorney will charge for drawing up a simple will, trust companies and banks do not charge - requiring instead that they be appointed executors of your estate; they will charge a fee when winding up a deceased estate. However, although a trust company or bank may appoint itself executor, in practice it will not accept the appointment if it appears that the estate will be uneconomical to administer. In such cases, an executor dative will have to be appointed.
Certain stationers sell specially printed forms that enable you to draw up your own will but, again, unless your estate is a very simple one, it is more prudent to seek expert advice.