We’ve recently had a number of queries relating to deceased estates so we’ve decided to summarize the steps required for winding up a deceased estate.
A comprehensive analysis of all the detailed issues which may arise in the context of the winding up process is beyond the scope of this post. However, what follows below should provide our readers with a basic understanding of what needs to happen.
The deceased estate administration process is regulated by the Administration of Deceased Estates Act 66 of 1965 (“the Act”) and can be summarized as follows:
1. When someone dies the estate of the deceased has to be reported to the Master of the High Court (“the Master”) by submitting certain prescribed documents.
2. If the estate has a gross value of less than R250 000 the Master may dispense with the appointment of an executor and instead give directions as to how the estate should be liquidated and distributed. This process is usually much easier than what follows below.
3. In relation to estates with a gross value of more than R250 000 the Master will appoint an executor who has to attend to the following matters required to wind up the estate:
3.1 Take custody and control of all the property and documents in the estate;
3.2 Notify all creditors and debtors by publishing a notice in the Government Gazette and in at least 1 newspaper circulating in the district where the deceased resided, the purpose of which is to call for all estate claims to be lodged with the executor;
3.3 Open a bank account in the name of the estate into which all money due to the estate should be paid;
3.4 Determine the solvency of the estate;
3.5 Draw up a Liquidation and Distribution Account (“L&D Account”) reflecting all the assets and liabilities of the estate and submit the L&D Account to the Master for approval;
3.6 Upon the Master’s approval publish a further notice in the Government Gazette and in at least 1 newspaper circulating in the district where the deceased resided, the purpose of which is to advertise the L&D Account;
3.7 Deal with any possible objections which may arise in respect of the L&D Account;
3.8 When the Master approves, pay the creditors and distribute the assets among the heirs in accordance with the L&D Account.
4. Upon receipt of satisfactory proof that all of the above has been attended to the Master will produce a filing slip as confirmation that the estate has been successfully wound up.
The process can take several months to complete depending on the complexity of the estate.