Oct 04 Que

OCTOBER 2004

LEGAL PRACTITIONERS EXAMINATION ADMINISTRATION OF ESTATES TIME 90 MINUTES

MARKS 100

Candidates should use their own facts where necessary QUESTION 1

(8)

Tom Smith sold his property, Erf 1234 Windhoek to Joe Brown for $500 000. Transfer to be passed when purchase price paid in full. On his death the balance owing was $200 000. The executor also collected $50 000 occupational interest of which $20 000 was in respect of the period after death. Set out the entries that will appear in the Liquidation and Distribution account dealing with this transaction. QUESTION 2

(55)

Joe Small, married in community of property, has died testate. His estate consists of the following: a) A farm valued at N$ 600 000,00. b) A beach cottage valued at N$ 300 000,00 c) Farm implements valued at NS 200 000,00 d) A tractor sold for NS 40 000,00 prior to his death The purchaser has paid N$30 000,00 of the purchase price e) Shares in private company: value N$ 40 000,00 f) Cash of N$ 100000,00. His wife, Betty, has N$ 75 000,00 in her bank account. The beneficiaries under his will are Betty and their son, Charles, in equal shares. They wish to redistribute the assets, as Charles wants to take the farm and implements. Draw: 3.1 Liquidation account [24] 3.2 Distribution account [14] 3.3 Redistribution agreement (each heir must receive the same amount as they would have received under the will) [17] QUESTION 3

(8)

A bequeaths her jewelery, paintings, furniture and personal effects to B, and the residue of her estate (comprising her sectional title unit) to C. There is no cash in the estate. Liabilities total N$ 50 000,00. The beneficiaries are not able to contribute; cash in order to avoid a sale of assets. 3.1 Which asset or assets will the executor sell? 3.2 Who has to consent to and/or approve the sale?

[3] [5]

QUESTION 4

(29)

John Smith, who was seriously sick in hospital and not expected to live, wrote out a joint will for himself and his wife, Mary to whom he was married in community of property. In terms of this will, the survivor would receive ½ (half) of the estate and the balance of the estate of the first dying is awarded to his/her children/step-children Joan, Peter, Joseph and Ruth in equal shares. Carol Peters and Kevin Jackson witnessed the will. While returning from visiting her husband, she is involved in an accident, caused by the negligence of her son Peter. Mary was killed instantly, Peter died three days later in hospital. She leaves the following family: a/ b/ c/ d/ e/ f/

her husband John, her daughter Joan Jackson married out of community of property to Kevin Jackson. her step-son Joseph, born from her husband's previous marriage, Timothy Smith, son of Peter Smith, Gerald Tasmer son born from her previous marriage, daughter Ruth Jacobs married in community of property to Henry Jacobs.

The balance for distribution amounts to $240 000 4.1 4.2

State who can inherit from the joint estate the amount of the award and the reason for such award [19] State reasons why certain family members cannot inherit in terms of the will and/or in terms of the laws of intestate succession. [10]