Roll players in an estate and their responsibilities – my will, my way…

02 April 2024 ,  Marié Combrink 21

It is very important to understand the functions and responsibilities (if any) of each and every person mentioned in your will to ensure that they are suitable for the position and to limit disputes after your passing between loved ones. People named in your last will and testament will be tasked with giving effect to your estate plan and ensuring that your final wishes are honoured. As such, it is imperative to understand the various roles and functions of each person mentioned in your will to ensure that they are suitable for the roll they have and that their appointment is aligned with your overall estate planning intentions including acting according to law and regulations.

Let’s start with the person that needs to attend to administering the estate after you have passed. 

Your Executor:

An executor is the person ultimately responsible for administering your deceased estate. In the event of your death, your nominated executor will basically attend to your estate as per your wishes and ensure that your estate is wound up to closure and all regulations are met. Your deceased estate will come into effect immediately from date of passing and your nominated executor is then required to apply to the Master’s Office for Letters of Executorship – which is, in essence, the formal confirmation of the appointment. Once appointed, your executor is required to set up interviews with your family members and loved ones, draw up an inventory of assets, advertise for creditors, and ultimately prepare a liquidation and distribution account which indicates to the Master of the High Court how this estate is administered.

Important to note: acting as an executor is an extremely onerous position that requires a special set of financial, legal, and administrative skills, so think carefully before nominating a person to attend to this. The task can be overwhelming for a layperson with no experience in this field or even a family member or friend feeling emotional and not up to the task.  Consider nominating a person you trust and have the proper knowledge and skills to fulfil this role.

The next roles player in estates are the beneficiaries and or people assisting with managing parts of the estate after winding it up.  We refer to the following:

Your Spouse:

As your marriage contract has a direct bearing on your freedom of testation, it is important to name your spouse and stipulate the nature of your matrimonial property regime in the opening paragraph of your will – although keep in mind that in the context of estate planning, a broad interpretation of ‘spouse’ is used. For estate planning purposes and when it comes to calculating estate duty, the Sars commissioner regards ‘spouse’ as any person in a marriage or customary union, unions recognised as marriages under tenets of religion, and same-sex or heterosexual unions that the commissioner is satisfied are intended to be permanent. For those who are married in community of property, keep in mind that upon the death of the first-dying spouse, the entire estate will be wound up, and the surviving spouse will have a claim for 50% of the net joint estate. This means that the first-dying spouse should only deal with their 50% share of the joint estate in terms of their will.

Your Minor Children:

In terms of our law, children under the age of 18 may not directly inherit lump sum payouts or any other assets as they are deemed not to have the legal capacity nor the ability to manage such assets. As such, if you intend to bequeath assets to your minor children, you may want to consider setting up a testamentary trust in terms of your will – an effective mechanism for housing and protecting assets until minor children reach legal age. A testamentary trust, which can be formed in terms of your will, essentially comes into effect in the event of your passing, whereafter any assets intended for your minor children can be bequeathed to the trust and managed by your nominated trustees. Your will can provide your trustees with a clear mandate for managing the assets on behalf of your minor children and at what age your children can receive their inheritance.

A Nominated Guardian:

When nominating a guardian, it is important to carefully consider who would be best to care for your child, taking into account their cultural background, value system, religious beliefs, location, and financial stability. The legal guardian will acquire full parental rights and responsibilities and will be required to administer any property inherited by your minor child until they reach age 18. The guardian will also be required to make all decisions regarding your child’s schooling, extra-mural activities, vocational guidance, and religious instruction. The guardian will also be responsible for assisting or representing your minor child in administrative, contractual, and/or legal matters until they reach maturity.

Discuss this with the person you nominate as guardian and ensure they are willing to accept such responsibility.

Your Trustees:

Trustees play a vital role in managing and administering the assets bequeathed to your testamentary trust for the benefit of your minor children. As such, it is essential that your trustees have the appropriate financial knowledge and understanding of the investment landscape and understand their fiduciary duty in relation to the trust beneficiaries and always act in the best interest of the beneficiaries. The Trustee has a responsibility to prepare accounts and records which must be made available to the Master and always act according to the Trust property control Act, common law and the trust itself.

Heirs and Legatees:

When drafting your will, it is important to understand the difference between your heirs and legatees. If you name a person in your will who would not otherwise inherit in terms of intestate succession, that person is known as a legatee. In other words, not a person who would benefit from your estate if no valid will was in place and according to our intestate laws. An heir is someone who is able to inherit via either testate or intestate succession, such as a spouse, child, or sibling. For instance, if your will is found to be invalid, your heirs would still receive their inheritance in accordance with the laws of intestate succession. Keep in mind that your spouse and children will always benefit first.

It is very important to understand the difference between the two, because, after settling all the costs in your estate, your executor must pay your legatees their bequests first, whereafter the residue of your estate will be distributed among your heirs. It is, therefore, essential to ensure that there is sufficient liquidity in your estate after any bequests have been paid to your legatees to provide for your heirs as you had intended.

Last requirement of valid will

Witnesses

Anyone over the age of 14 and who is of sound mind can witness your will. Your witnesses are legally required to sign your will in your presence and vice versa. If you and your two witnesses did not sign at the same time and place, your will can be rendered invalid. Your witnesses are not required to read or understand the contents of your will. Their job is to attest that you signed the will in their presence. 

Last comment and very important to always remember: a beneficiary or the testator’s spouse should not sign as witnesses to the will, as this could disqualify them from inheriting from the will.

 

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