Tutorial Letter No 1-2003

TUTORIAL LETTER NO 1 OF 2003 ADMINISTRATION OF ESTATES Students are reminded of the amendments to the Estates Act that came into force during 2002. please ensure that your copy of the Statute is amended accordingly. A copy of the regulations that were also published last year is attached. Bear these changes in monetary values in mind and annotate the notes accordingly as these amendments have not yet been incorporated in the lecture notes The following assignment must be completed and handed in to Mrs Klaaen before the start of the lectures on 22nd April. NB NO EXTENSION WILL BE CONSIDERED OR GRANTED. I would like to remind you that this is the type of question you will receive in the examinations. QUESTION 1 Answer the following questions giving your authority for your answer eg. Section and/or regulation to the Estates Act 1.1 What is the minimum Master’s fee payable in estates? 1.2 Under what circumstances can the Master dispense with an Estate Account where the assets exceed $100 000? 1.3 When is an executor obliged to obtain the approval of the Master to the sale of estate assets? 1.4 Under what circumstances can the Master insist on security by an executor even when he is exempted in the will? 1.5 A will in terms of which “A” was appointed as executor and sole heir was accepted by the Master. After “A” was appointed as executor, a later valid will in which “B” was appointed as executor was lodged with the Master. Discuss. 1.6 The preliminary inventory reflected assets of $150 000. after appointment, the executor discovers that a major asset valued at $80 000 was in fact not the deceased’s asset Discuss. QUESTION 2 Your client, Joe Smith, died intestate on 30-09-2002 leaving the following assets: House valued at Furniture valued at Shares in Smith & co (Pty) ltd Shares in Gold fields Ltd Dividend on Gold Field shares declared after death Total liabilities and administration expenses amounted to

$500 000. 50 000. 150 000. 50 000. 20 000. $100 000.

The deceased also held the fiduciary interest over shares in Namdeb Ltd valued at $500 000. Dividends declared prior to death on the Fiduciary shares amounted to $50 000 On the death of Joe Smith the fiduciary shares devolve on his Brother Tom. The deceased left the following family:

2.1 2.2 2.2.1 2.2.2 2.2.3 2.2.4

His Brother Tom. His daughter Jenny Peters married in community of property to Paul Peters, His grand children, children of his predeceased son Trevor Smith, Susan Smuts married out of community of property to Andrew Smuts Benny Smith minor. Peter Smith, Adopted son of Trevor. List the documents necessary for you to be appointed as executor. Draw up the following sections of the Liquidation and Distribution Account, using your own facts where necessary: Liabilities section Distribution account Fiduciary asset account Income Account

T TAYLOR