When a person passes away and leaves things behind, this is known as their Estate. An estate includes anything and everything that was under the deceased’s name or jointly held by the deceased at the time of death. Often the estate consists of bank accounts, residential property, insurances and personal chattels.
An executor or trustee of the estate manages and administers the deceased’s estate. If the deceased held a Will, then the executor named in that will may apply for Probate.
If the deceased died intestate (with no Will), then Letters of Administration will be required before any of the estate can be distributed.
The size of the deceased’s estate will also depend on what process is needed. Where the estate is larger than $15,000.00 (combining financial and non-financial assets), a grant of probate or letters of administration is required.
A grant of probate or letters of administration must be obtained from the High Court before the executor, trustees or any beneficiaries may claim and close any accounts or titles held by the deceased, and accordingly then distribute the deceased estate after the 6 month holding period.
What is Probate?
Applying for probate is done by the executor named in the will for the High Court to formally recognise them as the executor and trustee of the estate. Probate determines that:
- That the will is the last will created by the deceased;
- That the applicants for probate are indeed the executors of the will;
- That the applicants will carry out the wishes of the deceased in line with the law.
When the High Court has confirmed that everything is in order, the court will issue a grant of probate (a document stating that there is proof that the will submitted is valid and that the executors named are able to carry out the administration).
The grant normally takes around 6-8 weeks from the date that the probate application is submitted to the High Court.
What are Letters of Administration?
Where the deceased does not have a will, letters of administration may be applied for by the deceased’s surviving spouse or partner, children, parents, siblings, or other family members (in that order of priority).
Where a child of the deceased is applying for letters of administration, all the other siblings must be made aware of this application and, if possible, give their consent.
Similarly, to probate, the Court will issue a grant to the applicant/s recognising them as the executors and administrators of the estate. This grant also can take up to 6-8 weeks from the date that the letters of administration application is submitted to the High Court.
What next?
Normally the applicant/s and family of the deceased instructs us to act on behalf of the Estate. We, as lawyers for the estate, prepare the application documents, as well as accounts, titles and insurances for the claim and closure process once the Court has issued a the relevant grant.
It is important to note that the estate and/or any funds from the estate must be held for the minimum legal period of 6 months from the date of the grant of probate / letters of administration. This 6-month period allows for any other claims against the estate to be brought to the executor’s attention before any distribution of the estate is made.
If an estate is distributed before the 6-months period is up and there are then successful claims, the executors may be held personally liable to meet those claims. If the estate is distributed after the six months and there is a later successful claim, the executor will not be held personally liable but the claim may still be settled using any funds in the estate.
Executors can distribute an estate after 6-months following the grant of probate or letters of administration if no proposed claim has been received. The beneficiaries should not expect distribution earlier than 6 months after the date of the grant.
Author: Isabella Nathan – General Practice Solicitor