Author: Design

Power Of Attorney

Written by Design on March 10, 2022. Posted in Wills & Trusts.

What does a power of attorney cover and when does it cease to exist?

If you are temporarily unable to manage some or all of your affairs, you might want to grant a trusted family member, attorney or financial advisor the authority to do so on your behalf. In other words, you wish to grant someone power of attorney (POA). A POA allows the person you nominated (the agent) to perform juristic acts for you (the principal). There are various situations in which you might want to enact a POA, but they are limited and do expire.

Requirements to create a POA

A POA is not quite a contract. It is the legal expression of the principals will that the agent has the capacity to enter into legal agreements and make legally binding decisions for the principal. If the POA is completely valid, third parties are contracted with the principal, and the agent is protected from any liability.

A major requirement for a valid POA is the contractual capacity of the principal. In other words, under South African law, the principal has the capacity to enter the agreements he is authorising an agent to enter into. If the principal the nature and consequences of granting power of attorney, he cannot validly execute such a POA. If you, for example, do not have the capacity to understand the nature and consequences of an offer to purchase a house, you cannot grant another individual power of attorney to sign such a document on your behalf.

There are no formalities for a POA, and it can be given orally or in writing. Best practice, however, is to have a POA in writing and signed by two witnesses. The POA should also state exactly what the agent is and is not authorised to do. If the principal is a company and, more specifically, the director of a company, that individual must be authorised by the board of directors to execute a POA on the company’s behalf.

What does a power of attorney cover?

A valid POA can cover the acceptance, amendment, and signing of any legally binding document or making important decisions. These can include decisions with regard to your finances, property, tax, entering into contracts, settling claims, renewing licenses, etc. You might want to execute a POA for various reasons including:

Emigration and wanting someone in South Africa to finalise your affairs here. A POA can make it easier.
You are leaving the country for an extended period of time.
You want someone with legal or financial expertise to assist and handle decisions for you.

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Death and Not Legally Married

Written by Design on March 10, 2022. Posted in Deceased Estates Administration.

My life partner passed away and we weren’t legally married, now what?

There are various ways to get married in South Africa. There are also various reasons that a couple would be life partners, but not get legally married. These reasons are often personal in nature and one can only speculate as to what they are. What we can know for certain, however, is the consequences of one member of the life partnership passing away and the possible difficulties for the remaining member.

(Not) Legally married

With all the different customs and cultures in South Africa, there are different ways in which people want to get married and different things that people think are important for a marriage. As far as the law is concerned, though, two people can get married in terms of a civil marriage, customary marriage, civil union, and a religious marriage. Note that a religious marriage is not recognised as a legal marriage under South African law, but in certain instances, the spouses are protected by the law.

A civil marriage can only be entered into by a man and a woman. Unless an antenuptial contract is signed stating otherwise, it is automatically a marriage in community of property.

A civil union can be entered into by two people and by persons of the same sex. As with the civil marriage, it is automatically in community of property unless your antenuptial contract is different.

A customary marriage is celebrated and concluded as per the indigenous African customary law. It is recognised as a legal marriage according to the Customary Marriages Act. The exact traditions that need to be followed may differ from community to community, but generally, lobola must be paid after which the necessary rituals and celebrations must take place. A customary marriage also allows for polygamy, though the groom must apply for permission to the High Court and the customary marriage must be registered at the Department of Home Affairs within three months.

A religious marriage is entered into in terms of a religion like the Islamic faith. Although it is not legally recognised, spouses are protected against domestic violence and when a spouse dies, the surviving spouse may

Approach the Magistrate’s Court to request maintenance against the deceased estate
Inherit in terms of the Intestate Succession Act if no will was left behind

If your partnership does not fit into any of the categories above, you are not married in the eyes of the law.

No such thing as a common-law marriage

Many South African live together with the understanding that their years of partnership and cohabitation constitutes a common-law marriage with all the legality that is involved in a marriage. This is false and they are just cohabiting a space with no legal commitment in terms of marriage. A cohabitation agreement can be entered into that can regulate financial and property matters, like who pays the mortgage and who pays for living expenses. It provides financial stability, but they are still not legally married.

So, what if my partner passes away?

It is clear that if you and your partner were not married in any of the manners as set out above and you had no type of contractual agreement, the surviving spouse is left with no legal recourse to make any claims against the deceased estate.

A partner is only entitled to inherit from the deceased estate if they were legally married, and a cohabitation agreement does not give you the same right.

The only way to ensure your life partner inherits from your deceased estate and is legally protected after your death is to draw up a will and include him/her in it.

At AED Attorneys, we understand that every relationship is unique. We also understand that the law will place you into certain legal boxes. Having an airtight will is one of the best ways to protect your loved ones, married or not, after your passing and that is where we can help.

AED Attorneys understands that every situation is unique, and although they strive to ensure that the information contained herein is accurate at the time of publishing, it cannot be guaranteed to be without errors or omissions. As a result, AED Attorneys, its employees, independent contractors, associates or third parties will under no circumstances accept liability or be held liable for any innocent or negligent actions or omissions in this article, which may result in any harm or liability flowing from the use of or the inability to use the information provided.

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Uif

Written by Design on February 2, 2022. Posted in Deceased Estates Administration.

When a family has to deal with the death of a loved one, it places a lot of emotional stress on them. If that loved one is also the breadwinner or important monetary contributor to a family, the added financial strain makes it even more difficult to grieve and deal with your emotions in a healthy manner. One financial recourse that is possibly available to the family members left behind is the UIF Dependant’s Benefits which allows dependants of UIF (Unemployment Insurance Fund) contributors to claim.

UIF contributions

The Department of Labour states that the “Unemployment Insurance Act and Unemployment Insurance Contribution Act apply to all employees and workers, but not to:

workers working less than 24 hours a month for an employer
learners
public servants
foreigners working on contract
workers who get a monthly State (old age) pension or
workers who only earn commission.”

The UIF that is payable amounts to 2% of the value of each worker’s pay per month – 1% is contributed by the employer and 1% by the employee.

When a worker becomes unemployed or is unable to work due to maternity, adoption, parental leave, or illness, UIF provides short-term relief to these workers if they contributed while working and are not exempt as stated above.

How can dependants of a deceased worker receive UIF?

UIF is available to the dependants of a deceased worker if you are a:

spouse
life partner
guardian
child of the deceased under the age of 21.

There are some exclusions, though. The dependants cannot only claim if the worker received benefits from the Compensation Fund or an unemployment fund as defined in the Labour Relations Act or if the worker was suspended from claiming because of fraud. Children can only claim if there is no spouse of life partner or if the spouse or life partner does not claim within 18 months of the worker’s death. The benefit is payable to a dependant for a maximum of 238 days and is based on the income the breadwinner was earning before he/she died.

How to claim…

A dependant must claim within 18 months of the worker’s death, and you will need to hand in various documents along with the application form. These are:

Your Identity Document
Copies of the deceased’s last six payslips
The employer’s details on form UI19
A certified copy of the death certificate
For the spouse: a certified copy of your marriage certificate
For the partner: lobola letter or an affidavit in case of life partners
For the children: proof of guardianship (if applicable), a letter confirming the minor is still in school, birth certificate
Proof of your banking details

When will the money be paid out?

According to the South African Labour Guide, the payments should start within 8 weeks of registering. Money is then paid out every 4 weeks until the benefit is used up. If you do not receive a payment in that time, you should contact the Labour Centre and ask them to investigate the delay. There is, however, anecdotal evidence that payments have taken much longer than the 9 months. The money paid out is not taxable, but if the UIF overpays an individual, you will be expected to refund that money.

In conclusion

Dealing with legalities and Governmental Departments is not what we want to do while we grieve the loss of a loved one. Sometimes, though, the financial difficulty we are placed in when the breadwinner passes away leaves us with no other option. Luckily, we do have options available to use, one of them being the UIF.

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Documents executed inside or outside of South Africa

Written by Design on February 2, 2022. Posted in Conveyancing.

Documents that are signed in South Africa but need to be used internationally, and vice versa, need to be signed and executed correctly, and you have to make sure they are legalised. These documents could include certified copies, academic certificates, birth certificates, marriage certificates, police clearance certificates, power of attorney, etc.

Signing/executing documents in South Africa for use outside of South Africa

In situations where countries are a part of The Hague Convention[i]

These documents first need to be notarized, i.e., signed and/or executed in the presence of a Notary Public. The Notary Public will attach a Certificate of Authentication with his signature, stamp and seal.
The Notary Public will then send these documents to the High Court in the area where he/she practices. There, the Registrar will add an Apostille Certificate which authenticates the Notary Public’s signature

Your documents are now legal in all the countries that are part of The Hague Convention

In situations where countries are not a part of The Hague Convention

When a country is not part of The Hague Convention, two more steps are required.

The documents are submitted to DIRCO’s Legalisation Section to be legalised. The Department of International Relations and Co-operation is based in Pretoria.
The documents are sent to the Embassy/Consulate where they are to be used and authenticated.

Your documents can now be used in countries that are not part of The Hague Convention

Signing/executing documents outside of South Africa for use in South Africa

In South Africa, Rule 63 of the Uniform Rules of the High Court stipulates how documents signed outside of South Africa can be authenticated. These documents need a Certificate of Authentication from:

The head of the South African diplomatic/consular mission.
Consul-general, Consul, Vice-consul, or consular agent for the United Kingdom in that country.
Any government authority of a foreign place permitted to authenticate documents under the law of that country.
Any Notary Public in the United Kingdom of Great Britain and Northern Ireland, Zimbabwe, Lesotho, Botswana, or Swaziland.
In the case of a document being executed by a person on active service, a commissioned officer of the South African Defence Force.

If the prescribed certificate is attached, you can use the document in South Africa.

[i] The Hague Convention of 5 October 1961 Abolishing the Requirement of Legalisation for Foreign Public Documents is a multilateral treaty developed by the Hague Conference on Private International Law (HCCH). It replaced the cumbersome legislation that was required for cross-border mobility with a single formality – the issuance of an Apostille. Currently 120 are a part.

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Executors or Brokers – Who deals with your policies afteryou die

Written by Design on December 14, 2021. Posted in Deceased Estates Administration.

Planning for the future is an activity that we all should engage in from time to time. We should not just plan for the immediate future, but we should keep in mind that some of the planning we do now can greatly affect the people we leave behind when we pass away. That is why proper estate planning is essential and having a life insurance policy is also very important to adequately provide for our loved ones.

The people involved with planning your estate is not necessarily the same people that are involved with providing you with a life insurance policy. So now the question is, when you pass away, who is responsible for your insurance policy – the executor of your estate, or the broker of your policy?

What are their roles?

Fully understanding who deals with your policy will be easier once we have clearly defined the roles of your executor and broker.

The executor of your deceased estate

The executor is responsible for administering your deceased estate once you have passed away. He/she is responsible for obtaining all the legal documents, like the death certificate and a list of all the assets and liabilities that are part of the estate. They are also responsible for reporting to the Master of the High Court through which they have been appointed. The executor has to make the death known to the deceased’s creditors and provide the opportunity to institute claims against the deceased estate. The executor is also responsible for closing the deceased’s bank accounts and opening new ones where the money of the estate will be kept. He/she has to determine how the liabilities are to be paid – is there enough money or must some of the assets be sold. The executor has to draft accounts for public inspection and lodge them with the Master of the High Court. If they are approved, the executor must pay the creditors and distribute the deceased estate accordingly.

Your broker

Your broker will organise and execute financial transactions on your behalf. Your insurance broker specifically works for you in purchasing the best policy that will meet your needs. They use their technical, legal and industry knowledge and experience to advise you on what your options are whenever you have to renew a policy or whenever a claim is filed against a policy.

How does your insurance policy factor into your deceased estate?

Certain policies and funds do not form part of your deceased estate – these include your retirement fund, living annuity, and business interest protected by a business assurance. Your life insurance policy can also rank among the policies not included in your estate in certain circumstances. As these do not form part of your deceased estate, they are not administered by the executor.

Your life insurance policy is usually deemed an asset in your deceased estate and thus forms part of payable estate duty. However, if the policy is recoverable “by the surviving spouse or child of the deceased under a duly registered ante-nuptial or postnuptial contract” it is not included in estate duty and not part of the deceased estate. In such a situation, the named beneficiary (spouse or child) is responsible for filing a claim with their broker who will then set the process in motion to have the insurance policy be paid out to them. This payment has nothing to do with the deceased estate, and the executor, responsible for administering the estate, is not involved with it at all.

If your estate is the named beneficiary, however, and there are several reasons why one would want to name your estate as the beneficiary, the policy forms part of the deceased estate, it is part of the calculation for estate duty as well as the calculation determining the executor’s remuneration. In this situation, the executor has to file a claim for the insurance policy to pay out. It is still, however, the broker that will actually deal with the claim and see to its payment.

Key takeaways

Ultimately, your broker will handle your life insurance policy and the payment thereof after your death once they have received a claim for it. The executor does not deal with the policy, though they might need to file the claim, depending on who the beneficiary is, and they might also need to deem the policy an asset in your estate when the estate duty or executor’s remuneration is calculated.

The relationship between your life insurance policy, estate planning, estate duties and executor’s remuneration can become a very complicated one, and it is best to have professionals assist you with your estate and life insurance planning. For the most part, though, the executor of your deceased estate will have little reason to deal with your life insurance policy as it is the named beneficiary of that policy that will deal directly with your broker (or insurance company).

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Valid Will

Written by Design on December 14, 2021. Posted in Wills & Trusts.

The importance of a valid will which is drafted correctly

There are some documents and contracts in your life that will simply be much more important than others. Your will is such a document. It is a document that becomes very important once you’ve passed away and also gives you the best chance to ensure your wishes regarding your estate are respected once you are no longer here. The importance of a will should never be underestimated, nor the requirements that need to be met to ensure that the will is valid and drafted correctly.

What a valid will can and can’t do once you have passed away

In its most basic form, a will indicates how you wish your estate to be administered once you have passed away – who inherits what. If you have a valid will, it cannot be ignored. However, there are laws in South Africa that also have to be followed and a will can only be administered in conjunction with these laws. These are The Administration of Estates Act 1965, The Wills Act South Africa 1953, and The Intestate Succession Act 1987 (only applicable if you do not leave a will behind or your will is invalid).

What it can do:

In your will, you can nominate the individual that you wish to administer your estate. This individual, the executor, will be responsible for ensuring that the will is honoured, and the estate distributed legally and according to the will to the extent that it is legal and possible. If you nominate an individual in your will, it is best to also discuss this with them as they have the right to not accept executorship.

Your will can further clear up any doubts about who is to inherit which assets and/or monies. The flip side of this is that you can, of course, do your best to ensure that your assets do not end up with people you don’t want to have them. If you have a prized collection of rare books, for example, you can stipulate that these should be inherited by your bibliophile grandchild and not another relative that you fear will only sell them. In South Africa, no individual has the right to inherit from a deceased estate and if, for example, you name one family member as a beneficiary and not another, there is very little they can do about it. There are exceptions to this, however, that we will get to when we discuss what your will cannot do.

If you still have minor children, your will can also serve as the final indication of who you name as their guardian. If this is not stipulated, the court will decide. When a valid will is in place, it will be easier and faster for your heirs to access their inheritance. In your will, you can also give gifts and charitable donations that will help to offset the estate tax that will have to be paid.

What your will cannot do

Your will cannot enforce conditional gifts that are illegal, immoral or against public policy or unreasonable to enforce, solve your estate’s insolvency, or exempt you from certain financial responsibilities.

If you name a beneficiary and you want a condition to be placed on that inheritance, it has to be reasonable. Let’s say you sponsor your grandchild’s tertiary education but only if they leave their current partner whom you disapprove of – this is not an enforceable condition. An enforceable condition could be that he/she maintains a certain average throughout their studies.

If your estate is insolvent, your death will not change this situation. Your will might be written without considering the estate’s insolvency, but the insolvent estate’s debts with its creditors have to be settled first. Only once this is done can whatever is left of the estate be distributed among the beneficiaries.

In addition to debt responsibilities that need to be seen to, other financial responsibilities also take precedence. A minor child, for example, can claim maintenance from a deceased estate as a parent’s support of their children is only terminated by the child’s death, not the parents’. If an individual did not make provision for their child’s maintenance in their will, the child’s claim against the estate will legally rank higher than any named beneficiary. Similarly, a spouse can also claim maintenance if he/she is unable to meet their maintenance needs by themselves, but only if the marriage was dissolved by the death of the spouse.

What makes a will valid?

The contents of a will mean next to nothing if the will itself is not valid and a will is only valid if:

The testator is 16 or older and mentally capable of appreciating the nature and effect of his/her act.
The will must be in writing – typed or handwritten. The person that wrote the will cannot be a named beneficiary.
Every page of the will is signed by the testator and competent witnesses.
The testator and witnesses must sign in each other’s presence.
A witness cannot be a named beneficiary or nominated executor
If the testator cannot sign due to a disability, they can nominate someone to sign on his/her behalf or make a mark (a cross or thumbprint). This manner of signing needs to be certified by a magistrate, justice of the peace, commissioner of oaths, or notary public that will also sign each page of the will.

If these requirements are not met, a will can successfully be contested because there was a failure to comply with the formalities or the testator did not have a testamentary (mental) capacity. A will can also be contested on the ground of forgery or undue influence.

When you want to draft a will or review your current will, it is best to have it done by professionals that have extensive knowledge of all the laws and requirements that have been touched on here. At AED Attorneys, we can assist you with drafting a will that will make it as easy as possible for your executor to administer it and your loved ones to inherit.

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Why rates and levy clearances are issued 4 months in advance.

Written by Design on November 16, 2021. Posted in Conveyancing.

It’s not for naught that we need knowledgeable attorneys when we embark on the journey selling or buying a home. There is a plethora of laws that we need to keep track of and hoops we need to jump through to ensure that the transactions and conveyancing goes smoothly. Being able to entrust the conveyancing to an expert just makes things easier, but that does not mean that we don’t want to know what is happening and why – it is, after all, our home ad future that is on the line.

One document without which a property transference cannot be completed is a rates clearance certificate. If you are purchasing or selling a sectional title, you also need a levy clearance certificate. If you don’t have them, the transfer is dead in the water, but what are they and why are they issued four months in advance?

What are these documents?

The rates and levy clearance certificates are, essentially, documents proving that the current owner of the property does not owe any outstanding money on the property, either to the municipality or the Body Corporate.

The Rates Clerance Certificate

This certificate is specifically awarded by the municipality in which the property is located. Both a freehold and a sectional title property requires a rates clearance certificate. The conveyancer responsible for the transfer will request the Rates Clearance figures from the relevant local authority. These figures include outstanding debts from the previous two years on municipal taxes, electricity, water, sewerage, refuse, etc. Once these are issues, the conveyancer will request the outstanding amount be paid by the current owner and upon a proof of payment being made available, the Rates Clearance certificate should be issued. The figures should normally be available in 10-14 days and the certificate within 2-3 days once payment has been made. By law, this certificate is valid for the 60 days from the date of issue.

The Levy Clerance Certificate

A Levy Clearance is only required if the property being transferred is a sectional title. In this case, the conveyancing attorney requests the Levy Clerance figures from the Body Corporate. It indicates the amount that the current owner still needs to pay to the Body Corporate to settle the last debts. When this amount has been paid or payment arrangements made and the Body Corporate is satisfied, they can provide the Levy Clerance certificate that the conveyancer requires to submit the next documents to the Deeds Office.

Why are they issued 4 months in advance?

When the Rates Clerance figures are being calculated, the municipality usually works it out as the full amount from the last two years that are owed and then the monthly average extrapolated over the next 4 to 6 months.

This is done because property transfers can take some time to complete, and the municipalities need to ensure that they are paid what is due to them by the seller in the months that the transfer is being completed. The Levy Clerance certificate also falls into this time frame as both documents are required for the successful transfer of a Sectional Title. These figures are also calculated to the estimated date of the registration of the transfer – 4 to 6 months.

If you need an expert conveyancer to help you jump through all the legal hoops of transferring a property, don’t hesitate to get in touch with AED Attorneys. Our friendly staff makes it their mission to ensure your property transfer is handles with care and as quickly as possible.

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Is Eskom clearances necessary for transfer of property?

Written by Design on November 16, 2021. Posted in Conveyancing.

The process of selling and transferring a property requires various legal documents to be signed, accounts to be settled and changed, certificates to be requested and more. Your conveyancing attorney will oversee this entire process for you, but in a world where knowledge is power, it is still important for you to know exactly what is happening, what documents you actually require and why.

When you look at the certificates you require, there are various categories – your Clearance Certificates, Compliance Certificates, and a Homeowners Certificate.

What do these certificates entail?

Your Clearance Certificates are certificates of proof from (a) your municipality and (b) the Body Corporate if you are selling a Sectional Title that any outstanding debt you had has been paid in full or that an arrangement (with the Body Corporate) has been made to pay the outstanding debt. Without these certificates it is impossible for the transfer of a property to continue.

The Compliance Certificates are required for electrical, electric fence (where applicable), gas, and beetle (in coastal regions) certificates. These need to be obtained prior to registration. The offer to purchase will usually specify the certificates that are required, and the bond attorney could also need these certificates to obtain consent to lodge the matter in the Deeds Office.

The Homeowners Certificate is only necessary if the property is part of an estate with a Homeowners Association. Similar to the Clearance Certificates, the Homeowners Association must confirm that there are no outstanding debts on the property and that all conditions have been met, for example the purchaser agreeing to become art of the Homeowners Association.

By now you would have noticed that Eskom is not mentioned in any of these certificates that you require. So, what do they have to do with anything?

Where does clearance from Eskom fit in?

You do not need a certificate from Eskom for the transfer of a property to be completed. The Rates Clearance Certificate that you do require from the municipality in which the outstanding debt from the past two years as well as a monthly average for the next 4 to 6 months is calculated on your municipal bills will include your electricity.

It is, however, always wise to ensure that your Eskom bill is fully paid and that all these accounts for the property are transferred to the new owner, lest you are held liable for the purchaser’s consumption.

If you require attorneys, you can trust and that has your best interests at heart, don’t hesitate to contact AED Attorneys. Our extensive experience in conveyancing means that we know how to transfer your property quickly and carefully.

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When you die… did you LIVE?

Written by Design on October 7, 2021. Posted in Deceased Estates Administration.

At one point or another, we all ask the same question. How we phrase it might differ, but it comes down to this, “Why am I here?” Your question might be, “Why do get up every morning?” or “How come I don’t feel fulfilled?” or “Why can’t I just be happy with what I have?” Asking these questions doesn’t make you weak, it doesn’t make you egocentric, and it doesn’t make you vain. They are all natural questions on our walk through life, but they do lead to a question you need to answer before any of them… “Are you truly living your life – your best life?”

(Not) picture perfect

It is so easy to judge our lives by what we see from other people. They have wonderful relationships, great jobs, go on adventures (even if they just camp out in their back yard). We forget that what we see on Facebook and Instagram is not their whole life. They are only moments and often the best moments. People very seldom show the true effort that goes into making those moments – the weeks on end of deadlines that leave you exhausted and that, for a while, make you hate your job, the argument that lasted an entire week and made both parties cry but that led to a point where the relationship was stronger, the budget that can’t quite make it to the end of the month so camping out in the back yard is all they’ve got. Fact is, those moments, the ups and downs, is what life is all about. Sometimes we cry at night and smile during the day. We just keep aiming for the end of the tunnel because if we look around, we just might give up.

It’s not all bad all the time

Read that again… it’s not all bad all the time. Even on our worst days, there is something good. It might not seem so and here is the thing, we have to learn and practice to see it. We need to learn to find joy and gratitude in the big things and the small, or else we will only see the bad. If you get up this morning and the sun is shining… hey… the sun is shining! If you happen to look up during the day and there is a gorgeous sight of gold-tinged clouds and sun rays peaking through, then you saw it. So many people missed that moment, didn’t see that beauty, but you did. If you pass a stranger and they look you in the eye and give you an encouraging smile, acknowledge it and realise, we are all on different boats in the same stormy sea and we can support each other with just a smile.

These things seem so minutely small in the greater scheme of things, but it can be just enough to help you take a deep breath, square your shoulders and keep going. If you need more help, there is nothing wrong with that. Talk to a friend and if you need it, talk to a therapist. They are both there to help and support you just like you are there to help and support your friends and family.

Now, why am I here?

That is not a question one person can answer another… but let’s venture out and say that money, fame, and success is not what will make your life worth living. If you just work for a paycheck, getting up in the morning might not seem worth it. If you just work to get accolade on accolade on accolade, it probably won’t fulfil you. If you just want everyone to know your name, you probably won’t be happy. What do you do with your paycheck, your accolade, your good name? Are you using it to make the world a better place and improve the lives of those around you?

There needs to be a balance. Just like the cycles of bad times and good times, there will be times of just working your butt off to get things done but they need to be balanced with knowing why you are doing it and using what you’ve got to the benefit of yourself and others. If you can, take that holiday you’ve been saving for months or even years. Use your accolade and good name to maybe raise some funds for a good cause, to work at a fundraiser if you can’t contribute otherwise, to get someone you know a job or empower them to be more… the possibilities are endless.

And if you can’t do any of those right now, remember to keep counting your blessings whether they be friends, health, a home, love, faith, a job, etc. And smile at the stranger walking past you, they just might need some encouragement today.

It is important that you live your life and do the things you keep putting aside! Always make sure that your affairs are in order before anything else. Visit https://sonjasmith-funerals.co.za/my-life-file/ and download the list of important personal documents that should be kept in a safe place, your LIFE FILE.

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What can you do when a co-owner of a property dies or wants out of the property.

Written by Design on September 23, 2021. Posted in Conveyancing.

Buying a property in a co-ownership agreement with a loved one, spouse, or business partner is a means for many to get into the property market. That property can be used as a primary residence, a business location or as a rental property and both owners can enjoy the benefits of it. Things change, however, and there are many reasons that one owner can no longer own the property. They could have passed away, they might want to emigrate, the relationship could have turned sour, or they might simply want to downsize their portfolio. Regardless of the reason, property ownership is a legal commitment and various laws dictate what happens to a co-owned property. These laws can differ greatly depending on the reason as to why one owner exits the agreement. Let’s have a look at some of the most prevalent situations.

The relationship between co-owners

The relationship between co-owners can often influence how the co-ownership came about and what needs to happen to the property when one owner passes away or wants out. In any co-ownership situation, the best practice is to always have a detailed contract set up when the property is purchased and to have this contract include what is to happen when:

An owner passes away (and he/she is not a spouse)
A spouse married in community of property passes away
An owner wishes to sell
The owners wish to part ways (whether it be a business relationship that breaks down, a divorce, etc)

When an owner passes away

When an owner, who was not a spouse, passes away, one would wish that the contract and the co-owner’s will stipulated what is to happen with the property. Half of the property will be placed in the deceased estate and the condition of the deceased estate, for example, the individual’s debt, can influence what happens. When a business partner passes away and you had a business succession plan and legal agreements, chances are that they would stipulate whether or not the surviving partner receives the share upon payment to the estate. The agreement and the deceased partner’s will could stipulate whether a family member inherits half of the property. Regardless of who receives the deceased individual’s shares, you will need to transfer the property.

A spouse married in community of property

In this instance, you also own the property half-half. The entire property would go into the deceased estate and the estate needs the be processed, debts paid, and all other matters relating to it dealt with. If the deceased estate’s debt, for which the surviving spouse can also be held accountable, is of such a nature that assets need to be sold to settle it, the property could be in danger of being sold. If this is not the case, the deceased individual could have his/her surviving spouse inherit half of the property in which case the entire property will need to be transferred to the surviving spouse as sole owner, and you might need to re-qualify for the bond on the property. If the beneficiary is another family member, half the property will go to him/her.

The one owner wishes to sell

If the one owner wishes to sell and the other does not, it could be stipulated what is to happen in the contract. Usually, the other owner would have the first option the buy the 50% of the shares that do not currently belong to him/her. If both are satisfied with the selling price, it could be a simple transfer of the property ownership. It could happen that an agreement cannot be reached in which case the property could be sold as a whole and both owners receive their share. The now previous owner could decide to buy the property again as a sole owner or find a new partner.

If the owners wish to part ways

This can be very similar to the situation above and it often happens the property as a whole is sold with each owner receiving his/her share, or the one owner buys out the other.

Co-owning a property is a bit more complicated than sole ownership. Our best advice would be to have a clear and nuanced contract that cover all reasonable eventualities concerning the death or departure of one owner. It avoids any unnecessary complications and confusion. If you need any assistance with the conveyancing of a co-owned property or the legal matters concerning the deceased estate of a co-owner, don’t hesitate to get in touch with the AED Attorneys. We understand that the loss of a loved one, the administration of a deceased estate, and the transfer of property can often all be part of the same traumatic event. Our single team of dedicated experts will take away the worry and stress when they handle it all.

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