Writing your Will can be a very simple process, but because it is only done a few times in your life, it can be intimidating. It can seem daunting because there are so many unfamiliar terms used in the estate planning world. Expressions that are second nature to the legal community, but are not in everyday use for the rest of us. Before you make a Will, it is important to familiarize yourself with some of the more common expressions.
Just because the terms are unfamiliar, they are not complicated concepts. In this article we will explain a few of the words that you will need to know before you make a Will. We hope that we can demystified the process a little.
Understanding Your Last Will and Testament: Avoiding Intestate
In South Africa if you die intestate the distribution of your estate is governed by the Intestate Succession Act. This falls under civil law, which addresses disputes between individuals or organizations regarding legal rights. This can result in assets being distributed to your surviving spouse, descendants or other relatives according to set rules. Potential disputes and legal claims over the estate may arise, requiring legal remedies and actions within this framework.
Definition and Meaning of Intestate
Dying intestate means that a person has passed away without leaving a valid will. This can lead to a range of consequences, including the distribution of assets according to state laws. When someone dies intestate, their estate is distributed based on a predetermined formula set by the state, which may not align with the deceased’s wishes. This process often involves court proceedings to resolve legal disputes among potential heirs and ensure that the estate is distributed fairly.
Consequences of Dying Intestate
The consequences of dying intestate can be significant and far-reaching. Without a valid will, the distribution of assets is left to the state’s intestate succession laws, which may not reflect the deceased’s personal preferences. This can lead to family disputes and lengthy court proceedings. Additionally, the absence of a will means that the court will appoint an administrator to manage the estate, which can delay the distribution process. In some cases, the estate may be subject to higher taxes and legal fees, further reducing the inheritance for beneficiaries.
Intestate Succession Laws
Intestate succession laws govern how an estate is distributed when someone dies without a valid will. These laws vary by state but generally follow a similar hierarchy. Typically, the estate is first distributed to the surviving spouse and children. If there are no immediate family members, the estate may go to more distant relatives, such as parents, siblings, or even cousins. The court plays a crucial role in this process, ensuring that the distribution follows the legal guidelines and resolving any disputes that may arise.
Estate
Your estate includes all assets except those with direct beneficiaries like certain insurance policies. It’s distributed according to your Will or by intestacy laws if you have no Will. In complex estate administration, a trial court may be involved to resolve disputes and ensure proper distribution of assets.
Estate administration involves managing and distributing a deceased person’s assets. In some cases, legal proceedings in a bankruptcy court may be necessary to address outstanding debts and seek relief under the guidance of bankruptcy judges. This process includes paying off debts, filing necessary tax returns, and distributing the remaining assets to the rightful heirs.
Types of Estates
There are different types of estates, each with its own set of rules and procedures for administration. Small estates, for example, may qualify for simplified probate processes, making it easier and quicker to distribute assets. Large estates, on the other hand, often require more complex administration and may involve multiple court proceedings, including those in federal courts and trial courts. Understanding the type of estate and the applicable legal requirements is essential for proper estate planning and administration.
Estate Administration
Estate administration involves managing and distributing a deceased person’s assets according to their will or, in the case of intestate succession, state laws. The executor, appointed by the court, is responsible for gathering assets, paying debts, and distributing the remaining assets to beneficiaries. This process can involve various legal proceedings, including those in appellate courts, bankruptcy courts, and even the supreme court, depending on the complexity of the estate. Executors must adhere to their fiduciary duty, ensuring that they act in the best interests of the beneficiaries and comply with all legal requirements.
Last Will and Testament Legal Document
A valid Will in South Africa must be signed in the presence of two competent witnesses. A will is a legal document that outlines a person’s wishes regarding asset distribution after death. A Will should outline asset distribution, guardian preferences and executor appointments.
Living Will
Not legally binding but provides healthcare directives. It’s recommended to have an Advance Directive which South Africa recognises and outlines your healthcare wishes.
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Power of Attorney
South Africa only recognises a Power of Attorney while the person is alive and mentally competent. It becomes void if the person becomes incapacitated. Consider an Enduring Power of Attorney or a curator bonis for mental incapacity.
Executor/Personal Representative/Trustee
The Executor manages the estate according to the Will. Pretrial services officers play a crucial role in the criminal justice process by investigating defendants’ backgrounds to determine whether they should be released or detained before trial. South African law requires Executors to be appointed by the Master of the High Court before they can act.
Beneficiary Legal Claim
Beneficiaries are individuals or entities you name in your Will to receive parts of your estate. Clearly naming beneficiaries avoids disputes.
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Guardian
Naming a guardian in your Will guides the court but is not automatically binding. The court will consider the best interests of the children when making a final decision.
Trust
Setting up a testamentary trust is common for minor beneficiaries. The trust can outline the rules for management and distribution of assets.
Witnesses
Witnesses must be present during the signing of the Will and cannot be beneficiaries in South African law.
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Probate Court Proceedings
Also known as the administration of an estate, this is mandatory in South Africa. An appeals court may review decisions made during the probate process. Probate fees and process are determined by the value of the estate and overseen by the Master of the High Court. An appellate court can uphold, reverse, or remand decisions made in probate based on the evaluation of procedures and evidence.
Fiduciary Duty Legal Term
Executors have a fiduciary duty to manage the estate properly, in the best interests of the beneficiaries. In legal proceedings, similar to how a defendant’s statement pleading determines the course of a criminal case, an executor’s actions can significantly impact the outcome of estate management.
Codicil
A codicil allows you to change your Will, following the same signing and witnessing requirements.
Testamentary Trust
In South Africa, testamentary trusts are in your Will and come into effect on death, managed according to your instructions.
He has over 20 years of experience helping people to write their Will and other estate planning documents. He has been interviewed by many of the major news media outlets and has contributed to articles in most leading publications. He has also contributed to a number of financial planning books.
Throughout his career, Tim has written extensively on the subject of Will writing and estate planning.
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