Business

No will was left

Legal Notes

With Alicia Hussey

Wednesday, June 02, 2010    

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WHEN a person dies leaving assets but no valid Will, he or she dies intestate. In order for one or more of the beneficiaries to be legally authorised to deal with the assets of such an estate, a Grant of Letters of Administration (the "Grant") must first be obtained from the Courts.

This Grant effectively appoints a personal representative to administer the estate in accordance with the laws governing intestacy. There are circumstances where a deceased leaves a valid Will but a portion of the estate nevertheless becomes subject to the laws of intestacy. This is described as a partial intestacy as the Will does not cover all the real or personal assets in which the deceased had a beneficial interest.

The very common quarrel over the colloquial 'dead lef' may be avoided where the laws and principles applicable to intestacy are understood and adhered to in the administration of an intestate estate. Several pieces of legislation, including the Administrator-General's Act, the Status of Children's Act and the Registration of Titles Act, govern this area of succession. We will take a brief look at some of the principles of intestacy as well as the rules of distribution which specify how the assets of an intestate estate must be divided by the personal representative.

Under the Administrator-General's Act, where a child under 18 years old is entitled to share in the estate of the deceased, the Administrator-General is required to administer the estate until that child is at least 18 years old, thereby standing in loco parentis and safeguarding the interest of the minor. It is crucial to note that the law facilitates the administration of an estate for as long as it takes a minor to attain the age of majority. Therefore, if a one-year-old is entitled to benefit from an intestate estate, it is possible for such an estate be administered by the Administrator-General's Department for as many as 17 years. Another person may be appointed to carry out this function in the place of the Administrator-General, but this requires an application for a Court Order.

Section 13A of the Administrator-General's Act allows the Administrator-General to merely advise adult beneficiaries, who do not get along and cannot agree, that they have the option of seeking an Order from the Courts for the appointment of an appropriate person to take charge of the estate. When adult beneficiaries get along it augurs well for the smooth administration of the estate. Because the Administrator-General no longer has an obligation to take out the Grant in these circumstances, it is recommended that adult beneficiaries make every effort to facilitate rather than obstruct the administrative process. It must be borne in mind that whoever is in control of the administration of an intestate estate is under an obligation to distribute the assets in accordance with the law.

The Administrator-General's (Amendment) Act and the Civil Procedure Rules make it mandatory that the Certificate of the Administrator-General be obtained in every case, before an application for a Grant may be properly submitted to the Court. The law determines that the primary beneficiaries are the spouse and children of the deceased, and their right to apply would be in accordance with the priority ranking set out in the section below dealing with distribution.

In order to obtain the Certificate of the Administrator-General, the applicant is required to complete a Form of Particulars, a document which must be sworn before a Justice of the Peace, and submit it along with a fee of J$2,000.00. The following documents must also be submitted:

a. a certified copy of the Death Certificate;

b. a copy of the Oath of Administrator prepared by the applicant's Attorney; and

c. the consent of person(s) who have a prior right to apply for the Grant.

Beneficiaries who are equally entitled to the estate are not required to obtain the consent of each other. However, the applicant is required to submit evidence that the other equally entitled beneficiaries were served with notice of the applicant's intention to apply for the Grant. Further, where the applicant is someone who claims a benefit by virtue of a common-law union, an Order from the Supreme Court declaring the applicant a spouse of the deceased, will be required. The Intestates' Estates and Property Charges Act (the "IEPCA") defines "spouse" to include:

(i) "a single woman who has lived and cohabited with a single man as if she were in law his wife for a period not less than five years immediately preceding the date of his death; and

(ii) a single man who has lived and cohabited with a single woman as if he were in law her husband for a period not less than five years immediately preceding the date of her death."

The IEPCA makes it clear that only one person may be regarded as the spouse of an intestate for the purposes of the Act.

Once the Grant is obtained, the personal representative is required to deal with the assets of the estate in accordance with the principles outlined in the IEPCA. The IEPCA sets out the manner in which each class of beneficiaries would share in the residuary estate at the distribution stage of the administration process. The residuary estate is that portion of the estate which remains to be distributed after payment of funeral and administration expenses, debts and other liabilities. The manner in which beneficiaries share in an intestate estate is set out in the distribution schedule outlined below:

The surviving spouse is entitled to:

a. all personal chattels (these include household articles and motor vehicles but not articles used exclusively or principally for business at the time of the intestate's death);

b. ten thousand dollars or a sum equal to ten per cent of the net value of the estate, whichever is greater, free of costs and death duties and excluding personal chattels;

c. interest at the rate of ten per cent per annum until the sum described at (b) is paid or appropriated; as well as

d. the following relevant portion of the residue of the estate:

(i) the whole of the residue if there is no child or parent surviving the intestate; or

(ii) two-thirds of the residue if there is only one child of the intestate; or

(iii) one-half of the residue if more than one child of the intestate; or

(iv) two-thirds of the residue if there is no child of the intestate but there are surviving parent(s) of the intestate.

It must be noted that where any child of the intestate predeceases the intestate but leaves behind children who survive the intestate, those surviving children (grandchildren of the intestate) shall be entitled to the share which that child of the intestate would have been entitled. It is also to be noted that parents of the intestate do not share in the residue if there is a surviving child of the intestate. However, the parents of the intestate will share in the residue with the surviving spouse.

If the intestate leaves no surviving spouse the children get the residuary estate absolutely, but if there is a surviving spouse, the children will take what remains after the spouse's entitlements described at (d) above are taken account of. This means, where only one child survives the intestate, he or she will be entitled to a one- third share of the residue and where more than one child survive the intestate, they share one-half of the residue equally.

Where the intestate leaves no surviving spouse or child, the parents take all the residuary estate, but where the intestate leaves a surviving spouse, the parents will only be entitled to the residue after the surviving spouse receives the entitlements described at (d) above. This means, the parents would receive a one-third share of the residue.

Other surviving relatives of the intestate may only share in the estate where the intestate leaves no surviving spouse, child or parent. The residuary estate would devolve in the following order:

a. to the brothers and sisters of the whole blood of the intestate; but if none, then;

b. to the brothers and sisters of the half blood of the intestate but; if none, then;

c. to the grandparents of the intestate; but if none, then;

d. uncles and aunts of the intestate (who are the brothers and sisters of the whole blood of the parents of the intestate); but if none, then;

e. uncles aunts of the intestate (who are the brothers and sisters of the half blood of the parents of the intestate.

Where the intestate leaves no surviving spouse, child, parent or other eligible relatives as mentioned above, the residuary estate of the intestate will go to the government as bona vacantia. Where this happens, it is useful to know that under the law the government may provide for dependants of the intestate as well as for any other person for whom the intestate might reasonably have been expected to provide. These provisions would be made from the intestate's property which devolves to the government.

In the event that a person dies leaving a valid Will which adequately covers all the assets he/she owned, the distribution schedule outlined above would not apply. A proper Will allows the assets of the estate to be disposed of in accordance with the wishes of the deceased. As such, the assets of the deceased would be distributed only to the beneficiaries named in the Will and in the manner the deceased dictated. If your answer to the foregoing question is 'yes', maybe you should consider preparing a proper Will.

Alicia P Hussey is an associate at Myers, Fletcher & Gordon and a member of its Property Department. Alicia may be reached at alicia.hussey@mfg.com.jm or via www.myersfletcher.com.

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