Avoid these pitfalls when drafting your will

AMANDA VISSER: A lot has been said and written about the importance of a valid will. However, it’s quite surprising that many people still underestimate the sophistication required to draft a proper will. Simple mistakes can lead to litigation when a will is contested in court after the passing of the testator.

To take us through some of the common pitfalls that fiduciary practitioners come across, I’m joined by Ian Brink, chairperson of Fisa, the Fiduciary Institute of Southern Africa. Hi, Ian. What are some of those pitfalls?

IAN BRINK: [One is] the use of vague, unclear language. This is where the use of language is often unclear as to what the intentions are of clients who want to draft a will, and can lead to discrepancies and confusion. By way of an anecdote shared with me by a colleague of mine, I’d like to just show an example of what happened. In this case it was a will that was drafted in the United Kingdom [UK], and it was probably one of the shortest wills ever drafted. It purely said: ‘All to mother.’ This will was actually valid, because it complied with the formalities and so on, but the contest was: ‘What and who was mother? Was it the deceased’s actual mother, or was it the surviving spouse, who we called mother throughout their marriage?’ Eventually the court actually ruled in favour of the surviving spouse. [Because she was] called ‘mother’ and the fact that they were married – and she eventually inherited.

Another example that I can use is where I would say: ‘I bequeath the content of my garage at the time of my death to my son.’ Although the intention was [to bequeath] only the tools in the garage, [the son] eventually also inherited the Rolls Royce that was in the garage at the time of death. So this is one of those bizarre examples as to what can happen because of the use of vague and unclear language.

AMANDA VISSER: There’s also the issue of legal terms, and the knowledge of how to use them correctly.

IAN BRINK: Yes, absolutely, Amanda. In this instance I’d like to refer to, say, three examples of words, legal terms, that are used incorrectly.

One is ‘usufruct’ which, in short, is the use of [something and the enjoyment of its profits, income or fruits], as opposed to ‘usus’, which is just the use of something [without enjoying its profits, income or fruits].

Then the third option would be ‘habitation’, which is only the use of a property for living purposes.

These are all personal servitudes that have to be registered against the title deed of the property, which makes it a personal servitude – and this is often not the intention. May I just, as an example, again tell you about a situation where the testator bequeathed his farm to his son, and gave his wife the usufruct of that. The intention was only that she should live in the house; but the fact that she’s now the usufructuary means that she’s entitled to the income of that farm – and this was never the intention.

So one must be very clear as to what the intention and the use of these legal terms implies.

AMANDA VISSER: Quite so, Ian. And then, when should one update your will?

IAN BRINK: It’s very important to look at your will and revise it to suit your changing lifestyle, the changes that have an impact on your life, like children being born or getting a divorce – that sort of thing. Maybe when we talk about divorce, I can just mention that the Wills Act actually allows for a period of three months after the divorce for the divorcees to change their wills. Why this is done is just, once again by way of an example, where the husband says: ‘I appoint my wife as the sole heir of my estate.’ They get divorced and two months later he passes away. The Wills Act will actually say that in that case she, the ex-wife, is then no longer entitled to inherit. If he passes away four months after the divorce and still has not changed his will, then that ex-spouse will inherit his estate.

Then obviously the birth of new children, where names are mentioned in the will, is not always a good thing, because by mentioning names you are excluding new children that are born and their names were not mentioned in the will.

AMANDA VISSER: And on that note, what is the best way to provide for minor children?

IAN BRINK: Definitely the fact that any minor heir – in other words, somebody under the age of 18 – cannot handle their inheritance personally, so it’s got to be handled by somebody else. That is why we look at something like a testamentary trust, which is set up in the will for the benefit of that minor child. So any inheritance to a minor child will be kept in a testamentary trust and managed by trustees on behalf of these minor children, with certain conditions and terms and so on that say how they have to be taken care of.

If that is not done, if there’s no testamentary trust, the inheritance will be paid over to the Guardian’s Fund of the Master of the High Court. As we all know, they don’t manage farms, cars, houses, that’s sort of thing, but only cash, which would imply that the executor then needs to dispose of all the assets, sell them and pay over the funds to the Guardian’s Fund at the Master of the High Court.

AMANDA VISSER: Ian, finally, people talk a lot about the ‘residue’ of your estate; what does it mean?

IAN BRINK: The residue of an estate is that which is left after the specific assets have been bequeathed and the liabilities and administration costs within the estate have been paid for. In other words, where a client says, ‘I bequeath my house to my daughter, my cars to my son’ and he stops there, he doesn’t say anything else, there will always be a residue, even if it’s only cash that is left, or the contents of a house or whatever. If you don’t bequeath that, then it will be distributed to the heirs in terms of the intestate succession law, which says it’ll be your spouse, your children, that sort of thing. So there will always be a residue. One has to cater for the residue otherwise it’ll be inherited in terms of the Intestate Succession Act.

Amanda, just to a wind up the discussion, I need to refer to a court case by the Supreme Court of Appeal in 2012 – the Raubenheimer vs Raubenheimer case. The court actually said that it’s a never-ending source of amazement that so many people rely on untrained advisors when preparing their wills, which is one of the most important documents they are ever likely to sign. This is by no means a recent phenomenon. Wills often have to be rejected as invalid due to a lack of compliance with prescribed formalities and so on.

So it’s important, I think, that one realises that a specialist professional will ensure that the will is drafted and executed in terms of the Wills Act and that the bequests are clear and concise. He or she will then see to it that the assets of the minor children are taken care of by placing it in an accessible testamentary trust.

AMANDA VISSER: Thank you, Ian. That was Ian Brink, chair of the Fiduciary Institute of Southern Africa.

Brought to you by the Fiduciary Institute of Southern Africa (Fisa).

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