In South Africa, we have the right to freedom of testation. This means that you are able to choose your heirs or beneficiaries, and the proportion of their inheritance, if you have a valid will. This is one reason to draw up a will.
However, if you die without a valid will – in other words, if you die intestate – your wishes are not known, so your estate is distributed according to the Intestate Succession Act. (Your “estate” is all the assets you own as well as your liabilities at the date of your death.)
The Act specifies the way the inheritance is shared out among various permutations of heirs – for example, if you have a spouse and descendants, if you have no descendants but do have a spouse, if you are survived only by your parents, and so on.
“Often, when I explain the law to clients, they conclude that they do not need a will,” says Elmarie Neilson, a Cape Town attorney. “They’ll say, ‘I was planning to leave everything to my spouse and children in equal shares anyway, so I don’t need a will.’ But then I say, ‘You do need a will, so that you can choose an executor.’”
The executor is the person who sees to the administration of the estate: paying any liabilities and expenses owed, and ensuring the distribution of the assets to the heirs or beneficiaries according to your wishes.
Who, then, is the best person for the job? Neilson argues that choosing an attorney is the best idea: “I would put up my hand because this is what I do for a living. But you could choose your children (or anyone else), even if they are overseas. The executor’s fee would then be split among them.”
By law, the executor’s fee may not be more than 3.5% (excluding VAT) of the gross value of the assets, and 6% (excluding VAT) of any income accrued within the deceased estate.
If the aim in nominating one’s children as executors is saving these fees, practically they might end up nominating an agent – an attorney – anyway. “Knowing what to do and how to do it is complicated. For example, the Master’s Office of the High Court (which oversees deceased estates) is now online. To register is enough to put anyone in an asylum. There are so many layers of admin and gobbledegook. But this is one of the things an attorney does for a living.”
What about drafting the will – who should do that? Again, this needs to be done by an attorney rather than a financial institution (or anyone else), says Neilson. “Finance people do finance; they don’t do law – and a will is a legal document. They do not have legal qualifications or experience. They do not know what advice to give because they do not deal with the back end – the liquidation and distribution (L&D) account, for example, the actual administration of the deceased estate.
“In addition, there are legal requirements, prescribed by the Wills Act, to ensure a will is valid,” Neilson explains. For example, it needs to be signed by the testator at the end and on each page; the signing has to be witnessed by at least two competent witnesses, present at the same time, and they also have to sign the will. These competent witnesses cannot stand to inherit from the will.
“When the rubber meets the road after you’re dead, you can’t fix it,” she cautions.
