The role of an executor is to step into the shoes of the deceased to ensure that their assets are distributed in accordance with the deceased’s wishes and the best interests of those left behind. It’s an important job that requires a unique combination of skills to ensure that the estate is administered efficiently, effectively, and timeously. As such, understanding the duties and responsibilities of one’s executor is key to ensuring you appoint the right person to the job. Let’s take a closer look at the executor’s function.
In the event of your death, your deceased estate automatically comes into existence and the winding-up process begins immediately. If you have drafted a will, the person nominated as executor will need to begin the task of applying to the Master’s Office for letters of executorship. In the absence of a will, the Master will appoint an executor dative to administer the estate in accordance with the laws of intestate succession. If you have nominated a spouse or loved one as your executor, bear in mind that the administrative burden that comes with the job may be difficult for them to bear at such a traumatic juncture in their lives. As such, it makes sense to consider appointing an independent person or entity who has experience in deceased estates and who can remain impartial and unemotional through the process.
The length of the winding-up process largely depends on the size and structure of the deceased estate, but can also be delayed in instances where the deceased died of unnatural causes, where the will is contested, where there are liquidity issues in the estate, or where a surviving spouse or children lodge claims against the estate. The process can also be held up by turn-around times in the Master’s Office, SARS, banks and financial institutions, or where heirs reside overseas.
The executor’s first job is to meet with the family of the deceased to obtain all necessary information in order to report the estate to the Master’s Office – a task which needs to be performed within 14 days from the date of death. Further, the death notice must be completed and forwarded to the Master’s Office in the jurisdiction where the deceased lived 12 months prior to his death. Together with the death notice, the executor should include a rough inventory of the deceased’s assets, a copy of the will, and an application for a Letter of Executorship.
If the Master is satisfied with the skill and expertise of the nominated executor, they will issue a Letter of Executorship which effectively gives the executor authority in respect of all matters pertaining to the winding up of the estate – including opening bank accounts, placing advertisements, paying creditors and selling or transferring assets belonging to the deceased. Note that any powers of attorney that existed at the date of death will automatically fall away. This entire process can take up to three months to complete, and any delays in the appointment of the executor can cause frustration for the family.
Once appointed, the executor is required to open an estate late bank account and place a Section 29 advert in the local paper and Government Gazette which should appear simultaneously. The purpose of this advert is to notify debtors and creditors of the deceased estate, granting them a 30-day period to submit any claims against the estate.
After the 30-day period has lapsed and all claims have been lodged, it is the executor’s job to prepare a Liquidation and Distribution Account (L&D Account). The L&D Account reflects all the assets and liabilities of the estate and determines its solvency. If there is a valid will, the executor is required to use this document to determine how the assets will be distributed. In the absence of a valid will, the assets will be distributed in accordance with the Intestate Succession Act. Complications can arise, however, where the deceased did not include a clause in his will dealing with the residue of his estate. In such circumstances, the executor will need to distribute any residue of the estate in terms of the laws of intestate succession.
In addition, complications and delays can also arise where the deceased did not make provision for their surviving spouse or for their minor children to whom they have a duty of support. In these instances, the surviving spouse and/or children may lodge a claim against the deceased estate. Further, if the deceased had a maintenance obligation to an ex-spouse that they did not make provision for in the will, this can result in further delays. Such claims can affect the liquidity in the deceased estate which, in turn, can require the executor to realise certain assets in the estate in order to meet its liabilities. In general, the executor will only realise assets where it is necessary to meet the liabilities in the estate, or where it is more practical.
Once finalised, the L&D Account is lodged with the Master where it is required to lie for 15 days to allow for queries. Anything pertaining to the L&D Account can be queried via a query sheet and the executor is obliged to provide answers to the Master. If there are no objections, the Master will grant permission for the account to be advertised.
At this point, the Executor is required to place a Section 35 advert in the local newspaper and the Government Gazette, where the account will lie open for inspection at the Magistrate’s Court for a period of 21 days. This process provides the opportunity for any objections, together with reasons, to be lodged with the Master. If no objections are lodged, the court will issue a ‘certificate of no objection’ and this certificate must then be lodged at the Master’s Office in order to grant the executor the authority to distribute the assets.
Once they have authority, the executor can begin to distribute the assets in accordance with the L&D Account. Assets such as immoveable property will be transferred into the heirs’ names or, where the property has been realised, the proceeds paid out in accordance with the will. Note that before any inheritance can be remitted to heirs living abroad, the executor will need to obtain permission from Sars. As a final step, the executor is required to provide the Master with proof that the estate has been liquidated in accordance with the will and, as such, must provide the Master with copies of the acquittances, proof that creditors were paid, and that property was duly transferred. Once he is satisfied, the Master will issue a filing slip and formally close the estate.
As is evident from the above, executorship is a specialised function that can take an enormous amount of time, including attendance in person at the Master’s Office. It’s often advisable to nominate a fiduciary expert who specialises in estate administration to fulfil this all-important role. That said, be wary of nominating banks or large corporations as your executors as the bureaucracy and red tape may frustrate your loved ones and delay the administration process.
Have a wonderful day.
Sue
