During their lifetime, most people usually acquire assets, some of which they will own at the date of death. In addition, they may have also incurred debts and liabilities, which may be outstanding at the time of their death. This is known as the deceased’s estate.
An estate is administered or managed by personal representatives. If appointed in a Will, such representatives are known as Executors. An Executor is someone the deceased had confidence in to carry out their final instructions. When there is no Will, (known as died intestate) or if the Executor is unable or unwilling to act, then such representatives are appointed by the High Court, and are known as Administrators.
Whether a person has made a Will or not, someone must be entrusted with the responsibility of gathering in all the assets of the deceased, paying the deceased’s debts, and distributing what remains to those entitled to succeed.
As the Executor is appointed under the Will, the right to administer the estate begins as soon as the will-maker dies, and the Will becomes operative. However, to prove their right to deal with the assets of the deceased, the Executor must apply to the court for a grant of Probate. They must prove the Will and their appointment as Executor to the High Court. It should be noted that any Enduring Powers of Attorney will be cancelled, and the Attorney can no longer act from the date of death.
If a person has not made a Will, after their death the estate must still be administered. In the absence of any directions from the deceased, their assets will be distributed in accordance with the Administration Act 1969 which sets out the persons who will succeed and their respective shares.
The Act also states who is entitled to apply to the High Court to be appointed as the Administrator of the estate. A grant of Letters of Administration will be made to an Administrator as evidence of their appointment to the office and of their right to deal with the estate.
ARL Lawyers are here to assist with the administration of an estate, whether as executor or administrator, by preparing the appropriate documentation for the High Court, closing bank accounts, redeeming life policies, selling shares, closing KiwiSaver investments, advising on the sale of real estate assets, paying all liabilities and completing distributions to the beneficiaries of the estate.
All assets that are jointly owned with another at the date of death, will automatically be transferred to the surviving joint asset holder. Such assets do not form part of an estate.
ARL Lawyers can assist you with the transmission of jointly owned real estate to the surviving joint owner.
If the estate is valued less than $15,000.00, then, it is not necessary to apply to the High Court for a grant of Probate or Letters of Administration. These estates can be administered informally, however if you require assistance, then ARL Lawyers can provide you with guidance. Any estate valued at over $15,000 will require a grant of Probate or Letters of Administration.
The general rule is that the personal representative has one year, “the Executor’s year”, in which to get in the assets and distribute the estate, but this is not a hard and fast rule.
Distribution of assets should be made six months after the date of the grant of Probate or Letters of Administration have been granted. This is advisable as the personal representative is personally liable if a claim is brought, and succeeds, under the Property (Relationships) Act, the Family Protection Act 1955 or the Law Reform (Testamentary) Promises) Act 1949.
An Executor or Administrator must keep proper accounts of their administration and be prepared to produce these if required to do so, as the High Court may require production of the accounts on the application of an objecting party. Again, ARL Lawyers are here to assist you with this. We will prepare statements of assets and liabilities, statements of account, and distribution statements for both the executors/administrators and beneficiaries.
Sometimes it is necessary for Beneficiaries (or potential Beneficiaries) of an estate to obtain their own legal advice. If you are unsure about what the terms of the Will mean to you, or if you believe they are unfair, ARL Lawyers are able to advise you about the administration process and whether you are able to, or need to, make a formal claim in respect of an estate. We can advocate on your behalf.
The Family Protection Act 1955 provides that a person has a moral duty to provide for close family members in their Will. If the person does not make adequate provision, a family member may have a right to contest the Will.
If any person provides services on the basis that they will be rewarded in a Will for their services and that doesn’t happen, they can contest the Will under the Law reform (Testamentary Promises) Act 1949.
When someone dies, their partner has six months to either accept the terms of the Will or claim an alternative share under the Property (Relationships) Act 1976. These claims are complex. ARL lawyers can provide you with specialist advice if needed.
ARL Lawyers can assist Beneficiaries who wish to make a claim in respect of an estate and assist Executors who need to respond to one.
Often a person who has died may have been a Trustee of a Family Trust. It is important that the ownership of any property held by the Trust is changed and it may be appropriate to review the Trust given the change in circumstances. Again, ARL Lawyers are here to assist you in this regard.