- What if someone dies without leaving a valid Will?
A person who dies without leaving a valid will is said to die intestate and the estate will be distributed in accordance with the rules of intestate succession, as set out in the Intestate Succession Act 81 of 1987. - Can I choose who I leave my estate to?
Yes, freedom of testation, also known as testamentary freedom, refers to the right of an individual to determine the distribution of their estate upon their death. This includes the ability to choose who will inherit their assets, how those assets will be distributed, and under what conditions.In South Africa, as in many other jurisdictions, individuals generally have the freedom to create a will or testament according to their wishes, subject to certain legal requirements and limitations, such as the rights of spouses and dependants to claim against the estate.
Under South African law, marriage creates a legal bond and a duty of support between partners. If your surviving spouse cannot support themselves financially, they have the right to claim maintenance from your estate in terms of the Maintenance of Surviving Spouses Act 27 of 1990. For the purposes of this Act, the definition of ‘spouse’ includes a person in a permanent life partnership, in which the partners, including same sex partners, undertook reciprocal duties of support. It is therefore not only married persons who can claim.
With regards to the Pension Funds Act 24 of 1956, you can nominate a beneficiary to your retirement fund although the final decision rests with the trustees of the fund.
It is important to bear in mind that your matrimonial property regime will also effect how your assets are distributed under your will.
Couples married in community of property have joint ownership in undivided equal shares, so you can only dictate the fate of your 50% share in your will, while your spouse retains their 50%. In marriages out of community of property, with the accrual system, your spouse is entitled to 50% of the difference between the accruals (growth) between the two estates if theirs is smaller.
Your matrimonial property regime is always given effect to first, then your will.
- Do all of my assets attract an Executor fee?
No, not all assets will attract an Executor fee. As long as beneficiaries are nominated on pre and post-retirement products, they will not be included in the estate, and therefore there will be no estate duty or Executor fee charged. With regards to endowments and life assurance, as long as a beneficiary is again nominated, there will be no Executor fee charged, but estate duty may be charged, depending on who the beneficiary is. - Why is it crucial to incorporate a range of choices of beneficiaries / heirs when distributing your estate?
If heirs who are mentioned in a will have died and there is no mention of substitution heirs in that will, this portion may devolve according to the laws of intestate succession. - Why is it important to include a Testamentary Trust in my Will?
A testamentary trust can serve as a valuable asset management strategy within estate planning. For example, if a testator wishes to leave assets to their minor children, a testamentary trust provides a reliable mechanism to safeguard and manage these assets until the children reach an appropriate age to handle their own financial affairs.Such a trust only comes into existence on the testator’s death and only if the purpose for which the trust was created exists, i.e. if one has stipulated that the trust must terminate when a child attains the age of 25 years and if at the date of your death a child is over that age, then there is no need for a trust.A testamentary trust can also be used to house assets bequeathed to a spouse or special needs child. If a minor child or a person with special needs does inherit, and there is no provision in the will for a testamentary trust, it is important to note that the inheritance will by law have to be held by the Government’s Guardian Fund until the minor is 18 years of age, which is not recommended as the person’s acting on behalf of the minor may not have the minor’s best interests in mind.
A beneficiary who is insolvent at the time of your death may also have his or her portion paid to a discretionary trust to ensure it is not attached by their creditors (see next).
- Insolvency exclusions in a Will – is this necessary?
Yes, the creditors of an insolvent estate would be entitled to attach any inheritance a beneficiary is entitled to inherit from the estate.It is advisable to make the necessary provisions for this in one’s will, as you would not want the inheritance to be claimed by one of the creditors of the beneficiary’s insolvent estate. The inheritance bequeathed to a beneficiary can only be protected by his / her creditors (should he / she be declared insolvent prior to receiving the inheritance), if the testator gives clear direction in his will that in such instances, the beneficiary will forfeit their inheritance in favour of the other beneficiaries, or paid into a discretionary trust.If this clause is excluded from the will and you have not made provision for such event, it is possible for creditors to attach the inheritance.
- Why Single Individual Wills than a Joint Will? A joint will is like an irrevocable contract, meaning that once the first spouse passes away, the surviving spouse is unable to amend the joint will, even if circumstances change.This lack of flexibility could result in assets and property being tied up for an extended period, thereby restricting the surviving spouse’s ability in various ways, for example downsizing the marital home or liquidating it to cover expenses such as assisted living costs.Furthermore, the absence of separate wills precludes the surviving spouse from altering beneficiaries. Consequently, if the surviving spouse remarries, assets designated in the joint will cannot be inherited by their new spouse or stepchildren.
- I wish to bequeath specific items of jewellery to each of my children. Must these bequests be reflected in my Will or can I do a Letter of Wishes?
A letter of wishes, or any contract that purports to dispose of your property after you die, is not legally binding. The only exception to this is your antenuptial contract which may contain testamentary and inheritance provisions. It is thus important to formalise these bequests within a will. - Can the proceeds of a Pension Fund, Group Life Scheme, Provident Fund, Retirement Annuity and Insurance Policies be bequeathed in terms of a Will? The proceeds from an investment can only be directed according to your will if they are payable to your estate upon your passing. If you’ve designated a beneficiary to receive the proceeds from an insurance policy upon your death, the issuing company will distribute the proceeds directly to that beneficiary. In such a case, you cannot alter this designation by stipulating the proceeds in your will. Any changes to the nomination must be made directly with the relevant company.If, however, the proceeds are payable to your estate due to the absence of a nominated beneficiary, they will then be distributed according to the instructions outlined in your will.Other benefits, as mentioned earlier, will be paid directly to your dependants by the relevant company, scheme, or trustees of the fund, regardless of whether they are financially dependent on you. Only if there are no dependants will these funds be directed to your estate.
It’s crucial to discuss with your financial planner or policy holder to confirm the designated beneficiaries for your policies and ensure they are up-to-date and in accordance with your wishes.
- Why a Bond of Security in a deceased estate?
Executors are required by law to obtain a bond of security before they can start administering the estate of a deceased person. This bond of security serves as a guarantee that the executor will perform their duties in accordance with the law and will not misuse the estate’s assets.Bonds of Security are issued by registered insurance companies and can be obtained online through authorised providers. The amount of the bond is determined by the Master of the High Court and is based on the value of the estate. - Why exempt an Executor from providing security in terms of a Will?
A bond of security is put in place to protect the estate assets especially if the executor appointed by the deceased’s will lacks the necessary financial experience or capacity to handle the estate’s affairs. An executor may be exempted from providing security either in terms of the will, or if the executor is a parent, spouse or child of the deceased.There could be instances where the testator decides to waive the requirement of a bond of security for the executor in their will. Here are a few reasons why someone might choose to do so:- Trust in Executor: The testator may have complete trust in the executor’s ability to handle the estate’s affairs responsibly and honestly. They might believe that the executor will fulfil their duties without the need for additional oversight.
- Avoiding Delays: Requiring a bond of security can cause delays in the administration process.
- Executor’s Qualifications: If the executor is a professional, such as a lawyer, financial planner or accountant, with a solid reputation and experience in estate administration, the testator may feel comfortable waiving the bond requirement due to their professional standing.
- I have assets in a foreign country. Should I have a separate Will in respect of those assets or can I have one Will to cover my worldwide estate?
While it is feasible to create a single will to address your assets worldwide, it’s important to acknowledge that succession laws and estate administration protocols vary from one country to another. As such, it is advisable to have separate wills crafted by experts well-versed in the laws of each country where your assets are situated. This approach ensures that your estate planning accurately aligns with the legal requirements and procedures specific to each jurisdiction, thereby minimising the risk of complications or disputes during the probate process.There are situations where having a single will creates practical disadvantages. For instance, in cases where a foreign country does not recognise a South African letter of executorship, they may necessitate local probate or court authority similar to our letter of executorship before the estate can be settled. This requirement can lead to delays and incur additional costs. Probate involves the validation of your South African-drafted will by the foreign legal authority to enable the administration of your foreign assets. The process of obtaining probate may prolong the estate settlement, potentially resulting in financial disadvantages for your heirs.The primary motive behind establishing a foreign will is to expedite the process of settling your estate. Many South Africans opt to create a distinct will for their foreign assets to facilitate a smoother administration process, particularly in cases where the foreign jurisdiction imposes specific deadlines for estate settlement. By having a separate will, the winding up of your South African estate can occur concurrently with the handling of your overseas assets. This synchronised approach is advantageous for your loved ones, ensuring a more timely and efficient distribution of your estate.
- Should I include guardianship and care in my Will for my minor children?
Nominating guardians and caregivers for your minor children is of utmost importance in estate planning.First, it is important to distinguish between ‘care’ and ‘guardianship’. Care is very specifically defined in the Children’s Act 38 of 2005 and involves, amongst other things, providing your children with a suitable place to live. Guardianship, on the other hand, is defined under section 18 of the Children’s Act and includes the administering and safeguarding of the child’s property and assisting or representing the child in administrative and contractual matters. Given these definitions, it is advisable to make your child’s guardian and caregiver the same person.Typically, the surviving parent automatically assumes guardianship and care of the child. However, if you have minor children and wish to provide for their care in the event of yours and the surviving parent’s simultaneous passing, it’s essential to designate a substitute guardian.
When selecting a guardian and caregiver, several factors should be considered. If your preferred choice is older than you, focus on who would be the best caregiver for your children in the immediate future. Remember that you can adjust your choice. It’s advisable to review your selection periodically and update your will accordingly.
If there are concerns or objections from family members regarding your choice of guardian, prioritise the well-being of your children above all else. Have an open discussion with your chosen guardian and caregiver to ensure they are willing and prepared to take on the responsibility, and this will help you alleviate any uncertainties regarding their role in caring for your children.
- What is a Living Will?
The South African Medical Association Guidelines define a living will as “a declaration or advance directive which will represent a patient’s wish to refuse any medical treatment and attention in the form of being kept alive by artificial means when the patient may no longer be able to competently express a view.” This advance directive is then an instruction that is given by a competent person in relation to their health and medical decision, which is then acted on when this person becomes unable to make such decisions. - Is a Living Will legally binding and enforceable?
It’s important to note that living wills are not currently recognised in South African statutory law or common law.As a result, living wills function more as directives and are often treated similar to “do not resuscitate” orders. However, Section 12 of the Constitution of South Africa stipulates that “everyone has the right to bodily and psychological integrity,” which encompasses the right to make decisions regarding one’s own body. Consequently, the Constitution acknowledges a patient’s right to accept or decline medical treatment.Medical practitioners are expected to respect living wills, provided they are satisfied that the document accurately represents the current wishes of the patient.
However, if your family or medical practitioners believe there is even the remotest chance of recovery, they can choose to ignore your living will, and rightfully so. If there is no chance of recovery and a medical practitioner chooses to ignore your living will, it is best practice for him to refer you into the care of another doctor.
- Why have a separate Living Will and not incorporate it into your Will?
It may be too late when it is found. Rather ensure that your spouse, partner or loved one is aware of its existence and what your wishes are, in order for them to action it if when time comes. - Can I obtain Power of Attorney over my aged parents or my spouse? In short, yes, you can obtain Power of Attorney on behalf of your parent or spouse if they are physically disabled and unable to manage their affairs. If they are mentally incapacitated, however, they will not be able to sign a Power of Attorney themselves. When a person granting a power of attorney, known as the principal, becomes incapacitated in such a way that he is unable to make his own decisions, the power of attorney will lapse automatically. This is because the agent can only do what the principal can do at the time of signing. If your parent or spouse becomes incapable of acting on their own behalf, such as in cases of dementia or Alzheimer’s disease, you would need to obtain a court order to act on behalf of the person who now has diminished mental capacity, specifically known as curatorship.
