The administration of deceased estates is governed by the Administration of Estates Act 66 of 1965 in South Africa. The administration of a deceased estate refers to steps followed by an executor subsequent to the death of a person. These steps include reporting of the deceased estate by lodging a death notice and other supporting documents to the Master of the High court, collecting both improvable and movable properties of the deceased, settling debts of the deceased estate and also dispensing what is left to the beneficiaries.
It is important to note that a deceased estate must be reported within fourteen days after the death of the deceased to the Master of the High court. The estate must be reported in the area where the deceased lived twelve months prior to their death as provided in section 29(1) of the Administration of Deceased Act. In cases where the deceased is not a South African resident, the deceased estate can be reported at any Master’s office in the country.
Documents which are needed when reporting the deceased estate are different as they depend on the value of the estate. In cases where the value of the estate exceeds R250 000, letters of executorship must be provided and the entire process as stipulated by the Administration of Estates Act 66 of 1965 must be followed. Section 18(3) of the Administration of Estates Act provides that “if the value of any estate does not exceed the amount determined by the minister by notice in Gazette (R250 000), the master may dispense with the appointment of an executor and give directions as to the manner in which any such estate shall be liquidated and distributed”.
After the estate has been reported, an executor/representative will be appointed. If an executor is appointed, s/he can continue with the administration of the deceased estate, which includes the following:
- Collect the property that will form part of the deceased estate, such as any money that must be paid out from policies or money owed to the deceased estate and so on.
- Place an advertisement in a local newspaper where the deceased usually lived, as well as the Government Gazette. This advertisement will inform all creditors of the deceased’s death and request them to lodge their claims against the deceased estate (“claims”) within 30 days from the date of the advertisement. For example, a bank’s claim for a home loan.
Open an interest-bearing bank account in the name of the deceased estate (“estate account”). All other bank accounts or investments of the deceased will be closed and the balances will be transferred to the estate account. Determine if the deceased estate has enough property to pay the debts that form part of the deceased estate. If there is not enough money to pay some or all of the debts, the executor must consider selling some of the property.
Once all claims have been received and property collected, the executor will start preparing the liquidation and distribution account (“account”) that will, amongst other things, contains property that forms part of the deceased estate; debts that must be paid by the deceased estate; and remainder of the property, after the debts have been paid, that must be given to the heirs of the deceased estate (in terms of testate or intestate succession). If a representative is appointed, s/he can continue with the administration of the deceased estate without having to follow the same formal procedures as an executor.
