Property News & Updates

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WHAT TO CONSIDER WHEN SELLING AN IMMOVABLE PROPERTY FROM A DECEASED ESTATE

28
Sep
Category Updates

(For purposes of this article we are dealing with an estate with a valuation which exceeds R250 000 and where the deceased left a will.)

 

Provided the deceased didn’t impose any sale restrictions in his will, the executor is allowed to sell the immovable property.  There are however a few things to consider when attending to a deceased sale, namely:-

1.       LETTERS OF EXECUTORSHIP

In terms of the Administration of Estates Act, 1965, an executor of an estate must have been officially appointed in this capacity and be in possession of a Letter of Executorship, duly issued by the Master of the High Court of South Africa (hereinafter referred to as “the Master”) before such executor can legally bind the estate to the sale.

Should the executor sell the property without being in possession thereof, the sale will be invalid.

 

2.       CONSENT OF HEIRS

An executor is required to obtain a certificate from the Master to the effect that no objections exist to the intended transfer of the property. This certificate is usually endorsed against the Power of Attorney to pass transfer, which will be lodged with the Registrar of Deeds.

In order to issue the certificate / endorsement, the Master will require the written consent of all heirs who are due to inherit from the estate.

Should the executor be unable to obtain the heirs’ consent, he may approach the Master to obtain the certificate / endorsement without such consent and on conditions and terms, as the Master may approve. In the circumstances the executor would however have to motivate why the property should be sold and satisfy the Master that a sale is essential for the finalisation of the estate administration process. As this can be a lengthy and time- consuming process, it’s more practical for an executor to rather engage with the heirs and resolve any objections to the sale amicably.

 

3.       SALE PRICE AND VALUATION

In the interests of the heirs of the estate, an executor must ensure that the purchase price of the property is market related.

In terms of its directives, the Master accepts municipal valuations as being market related.

However, an executor must obtain a sworn appraisal / valuation from a duly appointed appraiser when the heirs of the estate are minors or persons under curatorship. Should the executor, in this instance, sell the property for a price below the sworn appraisal valuation, he would need to satisfy the Master that the sale is still in the best interests of the aforesaid heirs before the Master will issue the certificate / endorsement of the Power of Attorney.

 

 4.       SALE AGREEMENT

To protect the interests of all parties, the sale agreement must contain a clause to the effect that the sale is subject to the executor obtaining the Master’s certificate for purposes of the transfer. Should the executor be unable to obtain such a certificate due to a rejection by the Master, then the transfer will not proceed and each party will be restored to the position that they were in prior to the sale agreement being signed.

We hope the above information provided some guidance however, if there is any uncertainty about the process or legalities of a deceased sale, it is advisable to speak to a conveyancer.

 

Article by : Karen Britz

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