1. THE RIGHT TO CLAIM AN INHERITANCE OR LEGACY
The right to claim an inheritance or legacy vests in the beneficiaries upon the death of the person from whose estate the inheritance or legacy is claimable. On the contrary, the Common Law position is divergent in that an heir or legatee cannot be said to acquire ownership of an asset in a deceased estate immediately on the death of the deceased. This pronouncement was made in the case of CIR v Estate Crewe and later reiterated in Greenberg v Estate Greenberg.
The assets in a deceased estate all vest in the estate as an entity that is separate from that of an heir or legatee, unless there are special testamentary provisions which provide otherwise. However, in the absence of such provisions, no income or other benefits may vest in the heir or legatee until the Liquidation and Distribution Account has been confirmed by the Master of the High Court. This extends to dominion in any asset or right in the deceased estate. Exceptional circumstances to the contrary do exist and these shall be dealt with below.
In terms of the Income Tax Act, to the extent that any income or amount has been derived for the immediate or future benefit of an ascertained beneficiary of the deceased estate, such income or amount received or accrued, which would have been received in the hands of the deceased had it accrued to him or her during his or her lifetime, will be deemed to be income received or accrued to that beneficiary. In the event that such income or amount is not derived by the heir or legatee, it will be deemed to be income of the estate of the deceased. This was confirmed in the case of KBI v Grewar wherein the court held that section 25(1) of the Income Tax Act can be interpreted to mean that all income in the deceased estate, which accrues to the Executor within the meaning of the said provisions accrues to the beneficiary of such benefit, and such accrual takes place on the date on which it accrues to the beneficiary.
2. MAINTENANCE CLAIMS AND THE DUTY OF SUPPORT IN RESPECT OF DECEASED ESTATES
2.1 MINOR CHILDREN
It is settled law that parenthood automatically results in the obligation of a parent to support a child. This obligation stems from the Common Law duty, which arises immediately on the child’s birth, as well as from the provisions of the Maintenance Act No. 99 of 1998. The parent’s duty of support is expected to continue until the child becomes self-supporting. A claim for support can only be sustained if the claimant can prove that there is a need for support. The question regarding whether a child should look first to the surviving parent for maintenance in cases where the other parent has passed away, was left open in the case of Visser. Hahlo, however, asserts that the duty of support falls on the surviving parent first. However, in various other cases it was found that the means of a surviving parent were not sufficient enough to support minor children and the deceased father’s estate was held liable. The duty to support a child continues after the death of the parent.
2.2 MAJOR CHILDREN
The Court in Hoffmann v Herdan held that a 56-year old woman suffering from ill health, who had been excluded from her father’s will, could successfully claim for maintenance out of the estate of her deceased father. The reason advanced for this decision is that there is no authority to the contrary. It was further found that the case of Carelse v Estate De Vries, which postulated that a father’s estate could be liable for a child’s maintenance, did not differentiate between minor and major children. The Rule therefore, does not exclude major children from claiming maintenance from the deceased estate.
Grandparents also have a duty of support towards their grandchildren in cases where the parents are unable to maintain the child. The Rule founded in the case of Carelse v Estate De Vries to hold a grandfather’s estate liable to support grandchildren was extended in Lloyd v Menzies, wherein the Court held that it followed logically to hold such an estate liable towards the maintenance of grandchildren on the basis that had the grandfather been alive, he would have been obliged to support the grandchildren. The question regarding whether the grandparent’s estate is liable to support grandchildren remains open, as subsequent authority, Barnard v Miller found that the duty of support did not extend to the deceased estates of grandparents because it is not warranted by law.
In terms of the Maintenance of Surviving Spouses Act, surviving spouses of marriages dissolved by death after 1 July 1990 have a claim for the provision of reasonable maintenance against the estate of their deceased spouse, until death or remarriage. The claim, however, will only be in respect of needs for which the surviving spouse is not able to provide. The surviving spouse will not have a right of recourse against persons who have already received money or property from the estate. A surviving spouse’s maintenance claim has the same order of preference as that of a dependent child. Should the claims compete, each claim must be reduced proportionately. Should a conflict arise between the maintenance claims of a surviving spouse as such and that of the surviving spouse as a guardian of minor dependent children of the deceased, the Master may defer the matter until the court has made a pronouncement on it.
The Executor of the estate has the authority to devise an agreement with the survivor and the beneficiaries having an interest in the estate, to transfer the assets or a right in the assets to the surviving spouse or to a trust created by the Executor, or to impose an obligation on a beneficiary in full or partial settlement of the survivor’s claim.
In determining the reasonable maintenance needs of the surviving spouse, the court will consider the following factors:
- The amount available in the deceased estate for distribution to heirs and legatees;
- The existing and expected means;
- The earning capacity of the survivor;
- Financial needs and obligations of the surviving spouse
- Duration of the marriage to the deceased while it subsisted;
- The surviving spouse’s standard of living during the marriage to the deceased; and
- The surviving spouse’s age at the time of the deceased spouse’s death.
It is evident that the obligation of a spouse to maintain their surviving spouse is perpetual, unless the survivor dies or remarries. The generous acts of third parties such the children of the surviving spouse should not be considered when determining the maintenance requirements of the surviving spouse.
The definition of ‘spouse’ extends to the parties to a Muslim marriage. The interpretation of the word ‘spouse’ was further applied in the case of Hassam v Jacobs, the Constitutional Court expounded on the finding in Daniels v Campbell by applying the definitions of ‘spouse’ and ‘partner’ to polygynous Muslim marriages.
Similarly, the court in Kambule v Master of the High Court held that the term ‘survivor’ gains application in validly concluded customary marriages as contemplated by the Recognition of Customary Marriages Act.
2.5 UNMARRIED COHABITANTS
Unmarried cohabitants are not deemed to be ‘surviving spouses’ pursuant to the provisions of Act No. 27 of 1990. The Constitutional Court in Volks v Robinson found that the only possible meaning of ‘marriage’ when viewed in light of the provisions of the said Act, was one recognised by law or religion. It was held that incorporating permanent life partnerships in the purport and objectives of the Act would unduly place a strain on the provisions thereof. The distinction between married and unmarried persons in terms of the Act was found not to be unfairly discriminatory. Thus, unmarried cohabitants have no duty of support towards one another.
3. AUTHORITY TO DISTRIBUTE ASSETS (INCOME AND PROPERTY) FROM THE ESTATE BEFORE IT IS WOUND UP
In terms of section 26(1A) of the Administration of Estates Act, the Executor is warranted to release an amount of money or property from the estate of a deceased person, which the Executor deems to be sufficient to provide for the subsistence of the deceased’s family or household. The Executor may do so with the consent of the Master of the High Court and before the Liquidation and Distribution Account has lain open for inspection at the office of the Master and Magistrate (where applicable). Although the courts in Banjatwa v The Maintenance Officer for the District of Butterworth & Others and Du Toit v Thomas NO and Others interpret the meaning of an Executor within the context of the legal duty to support differently, the courts were ad idem that the Executor possesses the authority to distribute assets (whether relating to income or property as an inheritance, or maintenance claims) from the estate of the deceased prior to the advertisement of the Liquidation and Distribution Account and before the administration of the estate has been finalised accordingly.
The Master of the High Court, as a division within the Department of Justice and Constitutional Development, has the function of supervising the administration of deceased estates bestowed upon it. Once the deceased estate has been reported to the Master and an executor is appointed, the Executor will be obliged to administer the estate under the supervision of the Master. He or she will therefore, be accountable to the Master. There will be no obligation to account to the beneficiaries of the estate as they demand the Executor to do so. In accordance with the provisions of section 35 of Act No. 66 of 1965, the Executor has the duty of lodging a Liquidation and Distribution Account with the Master, which shall lie open for inspection by anyone with an interest in the estate, at the office of the Master. The parties having an interest therein may then lodge any objections that they may have with the Master, and not the Executor.
In the case of Moloto, the Court held that the payment of legal fees by the estate could not be said to be a dissipation or alienation of the assets of the estate. It was further found that section 26 of Act No. 66 of 1965 empowers the Executor to provide for maintenance for the family or household of the deceased if the Executor is of the opinion that it is necessary to do so. It was concluded that the amounts that were withdrawn from the estate late bank account by the Executrix were reasonable and legitimate expenses of the deceased estate. Furthermore, the Executor bears the duty of disposing of the mortal remains of the deceased in accordance with the terms of the will, provided that this is not impossible, too expensive for the estate to bear or unlawful. Similarly, the heir to the estate is entitled to arrange the funeral of the deceased and to decide upon the burial rites. If the deceased dies intestate and has left no instructions as regards his or her burial rites, then practical considerations should be taken into account, such as family relationships as well as other relevant circumstances.
The Executor may make advances to heirs or legatees on account of their inheritances and legacies, especially where the beneficiary is the surviving spouse or where there may be a delay in lodging the Liquidation and Distribution Account. The Executor should, however, be careful not to make overpayments, which will result in the Executor being held personally liable if he or she is not able to recover the overpayment. If any movables are delivered to a legatee or heir before the Liquidation and Distribution Account has lain open for inspection, ownership thereof passes to that heir or legatee immediately upon delivery if done in pursuance of the will.
Although the law remains iffy regarding whether the estate of a grandparent will be liable to make maintenance payments towards grandchildren, it is well-defined as regards other parties who can lodge a maintenance claim against the deceased’s estate and succeed therewith.
Evidently, the initial Common Law position that postulated that ownership of inheritances and other benefits (e.g. maintenance claims) in a deceased estate devolve upon the heirs and/or legatees only after the Liquidation and Distribution Account has been lodged and confirmed with the Master of the High Court, and after it has lain open for inspection without any objections being lodged against the Account, has been rendered obsolete through the development of the Common Law. This is evinced by the approach of the courts in welcoming the insertion of section 26(1A) in section 3 of the Administration of Estates Amendment Act, Act No. 63 of 1990. There is no doubt that an Executor who seeks to release certain assets or part thereof from the deceased estate before the Liquidation and Distribution Account has lain open for inspection may do so with the consent of the Master. The Executor may still act as a matter of urgency if regard is had to the decision in the case of Saiid v Schatz, where funeral arrangements have to be made promptly. With that said, it is always advisable that consent be secured from the Master to avert the peril of incurring personal liability should overpayments be made by the Executor.