Estate headaches
Finweek English|8 October 2021
It’s not always easy to wind up an estate. Sometimes problems and disputes arise, and according to experts, most of them can be prevented.
Zerelda Esterhuizen

Estates and wills are not exactly the most exciting reading – no one wants to be reminded of their imminent death, but unfortunately, it’s necessary. And whether you want to know it or not, most of us require an expert to give us the right advice. Firstly, simply ask executors, who often wrestle with estates (and heirs), about how important it is to have a will, and secondly, know that wills should contain no obscurities.

There are many problems associated with the winding up of an estate, says Deenisha Nadesan, director of fiduciary services at Capital Legacy. “A major problem is of course when a person does not have a valid last will. It can result in delays in the reporting and administration of the estate and unintended consequences for those you leave behind. Family or heirs often do not understand the administration process, which can result in frustration and discontent.”

According to Nadesan, another headache is when there is limited information about the deceased’s assets and liabilities such as bank accounts, policies, fixed property, shares, business interests, and the like. “It could lead to delays in the gathering of information needed to report to the Master of the High Court, in which case it could take longer to finalise the estate.”

She adds that another problem is cash shortfalls in the estate in respect of both administration costs and creditors, with the result that the estate cannot be finalised.

Kobus van Schalkwyk, head of legal for Standard Trust Limited at Standard Bank, says if there is not sufficient liquidity in the estate to pay the liabilities and cash bequests, some of the assets, such as the family home, may have to be sold by the executor to expunge the cash shortage. “All liabilities must be paid before an estate can be finalised. Market conditions at the time may not be conducive for the sale of property or other assets.”

Nadesan says not having the correct person or structures in place to continue with the deceased’s business activities may result in loss of revenue and value for the business as well as causing stress and uncertainty for the family or heirs and also the business’ employees.

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