Who has the right to administer?

The court has wide discretion in appointing an administrator for the estate of a deceased person.

bhagsingh-20090630-righttoadminister.jpgWHEN a person’s life comes to an end, he leaves behind – apart from many other things – assets and liabilities. Of course, an asset-rich estate will attract due attention, whereas there may be little interest in an estate if the liabilities exceed the assets.

Whatever the situation, the estate will need to be administered. Until a person is appointed to administer the estate, no further action can be taken with regard to what is in the estate. This leads on to the question: who is entitled to administer the estate?

This depends on whether the deceased has left a will. If he did, it is said that he died testate. He is then referred to as a testator. If he did not leave a will, then he is said to have died intestate.

Where a will has been made, it is open to the testator to name one or more persons as executors to administer the estate. If there is no will, then the question of naming an executor does not arise. In such a situation, an interested person may come forward and offer himself as the administrator of the estate.

However, even where there is a will, it may transpire that only provisions for devolution of the property may be made. An executor may not have been appointed. Or it may be that an executor has been appointed but he died just before the testator himself or before he could start to administer the estate.

Appointment by court

The person who is going to administer the estate is always required to seek the court’s approval. Where there is a will, the application is for a grant of probate. Where there is no will, it is called a grant for administration. Only a person so appointed and who has obtained a grant can proceed to administer the estate. But who has the right?

When a man dies leaving a spouse and children, it is the wife who often applies for a letter of administration. If all the children are not adults, there will be a need to have an additional administrator or co-administrator. Such appointment will seldom be objected to. This is likely to be so because the wife is the mother of the children and the remaining elder in the family.

In some instances, the wife or mother may favour certain sib-lings. In other cases, the mother may be a stepmother. Sometimes there may be a combination of both as happened in the case Yap Kee Par vs Molly Yap & Ors.

In this case, it was contended that the deceased’s lawful widow should have the first priority to apply for a letter of administration for the estate. However, Vincent Ng J. dismissed this as being “wholly misconceived”.

This is because even though in many cases administration is granted to the most elderly or senior member in the family, particularly if such a person is also a beneficiary, this is not necessarily so.

Court’s discretion

The court has wide discretion when it comes to administering the estate. This is even more so when there is no will in which an executor has been named. In this case, discretion is conferred by section 30 of the Probate and Administration Act 1959 which reads: “In granting administration, the court shall have regard to the rights of all persons interested in the estate of the deceased person or in the proceeds of sale thereof, and, in particular, administration with the will annexed may be granted to a devisee or legatee; and in regard to land settled previously to the death of the deceased, and not by his will, administration may be granted to the trustees of the settlement; and any such administration may be limited in any way the court thinks fit.”

As can be seen, there is due regard given to persons who have a beneficial interest or are otherwise in the position of trustees and therefore owe a duty to deal with the assets in accordance with the trust.

However, it is relevant to note that persons who are entitled to the estate of a deceased – in order of priority based on the closeness of relationship to the deceased – are spouse, children, parents, brothers or sisters, children of brothers or sisters, grandparents, uncles or aunts.

However, though they are entitled to the estate and have priority as set out in the above order, when it comes to distribution, it does not necessarily create priority in terms of being the administrator. Each of the members of the same class referred to earlier has the same right vis-a-vis another member of the same group.

Insolvent estates

There are occasions when an estate may be insolvent or there may not be any assets. For example, there may be a house in which the family of the deceased may be staying. However, there may also be debts which may be equal to the value of the assets.

In such a situation, if letters of administration were applied for, it would become the duty of the administrator to sell off the assets and pay off the liabilities. So the likely scenario is that the members of the family may just continue to stay in the house without applying for the letters of administration.

In such a situation, it is open to a creditor to apply for letters of administration so that the pro-cess of liquidating the assets can be proceeded with. Such a person would not have to be a beneficiary but would be entitled to a grant on account of his interest.

A person appointed as an administrator will have a duty to administer the estate diligently, honestly and faithfully. He will be required to execute bond for the due and proper administration of the estate unless exemption is obtained.

Conclusion

Once an administrator has been appointed, his duty is to do the needful to wind up the estate. However, there are occasions when an administrator can be removed. This could be for many reasons and the same reason could be applicable to refuse to appoint a person as an administrator.

Thus in the case discussed earlier, the court refused to appoint the widow as the co-administrator. Among the reasons was the fact that she was alleged to have intermeddled with the estate, was residing abroad and susceptible to being under the control and dictation of others.

This story by BhagSingh originally appeared here.

This entry was posted in Rockwills & Estate planning, Rockwills & Inheritance and tagged , , , , , , . Bookmark the permalink.

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