Monthly Archives: September 2017

Should I draft a will?

B2A mother who has always wanted her daughter to inherit her diamond engagement ring may never get her wish granted if she dies without leaving a valid written will. The mother’s estate would then be distributed in terms of the Intestate Succession Act No. 81 of 1987. 

Know where you want your possessions to go

Taking the time to draft a will can leave you with the peace of mind that your assets will be distributed according to your wishes as far as possible. Your will should reflect exactly how you want your assets to be dealt with after your death and should not be contra bonos mores (against good morals). It should also not amount to “ruling from the grave”.

What makes a valid will?

There are a number of legal requirements that have to be complied with for a will to be valid.  If it does not comply with all of these requirements it could be found to be invalid. Your estate would then also be dealt with in terms of the Intestate Succession Act of 1987. It is therefore very importance that you obtain the assistance of a lawyer to help you raft a will.

A will should also regularly be revised and updated to adapt to your changing circumstances, for example after getting married, and when there is a child in the mix. Section 2B of the Wills Act No. 7 of 1953 (as amended by the Law of Succession Act No. 43 of 1992) deals specifically with a change in marital status by way of divorce, and reads as follows:

If any person dies within three months after his marriage was dissolved by a divorce or annulment by a competent court and that person executed a will before the date of such dissolution, that will shall be implemented in the same manner as it would have been implemented if his previous spouse had died before the date of the dissolution concerned, unless it appears from the will that the testator intended to benefit his previous spouse notwithstanding the dissolution of his marriage.”

An example

A and B get divorced and B dies within three months of the date of the divorce. B’s will was executed before they got divorced. Unless B’s will specifically indicated that A must benefit from B’s estate despite the divorce, B’s estate will then be distributed as if A died before they got divorced. A will therefore not inherit from B’s estate in this scenario. However, should B die more than 3 months after the divorce and B’s will, which benefits A, was not changed, then it will be seen as if B intended A to inherit, despite the divorce.

A person who was previously married and who remarries, should ensure that the necessary changes are made to his/her will. If not, this could have profound consequences for the “new” spouse, especially if the will still benefits the spouse from the previous marriage.

When there are minor children in the picture, it is advisable to make adequate provision for their living costs and education in your will. This can be done by creating a testamentary trust of which the minor children can be beneficiaries.

Conclusion

Thinking and talking about one’s passing is not a pleasant subject. Having a valid, clear and unambiguous will can prevent unpleasant family feuds caused by them having to make decisions about the distribution of your estate. It is certainly worth the time and effort to have a valid written will in place.

References:

Drafting of Wills 2013 – LEAD

Intestate Succession Act 81/1987

Wills Act 7/1953

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE).

The risk of EFT fraud when selling a car

B1Electronic Funds Transfers, better known as EFTs, have become a popular payment method in South Africa, accepted by many in lieu of cash or cheque payments. This allows buyers to reverse payments and essentially fraud sellers into thinking that they’ve been paid.

Many accept the printed EFT document as “proof” of a cash payment into the bank account, especially in the selling and buying of motor vehicles. They insist on the transfer to be made immediately there and then, after which the vehicle is transferred and registered to the buyer on the same day.

How do EFTs get abused?

The abuse of EFTs made to the seller’s bank account, especially between different financial entities, is yet another devious manner in which the original Natis documentation or registration of ownership of a motor vehicle can be obtained with no intention to honour the actual payment.

EFTs are governed by agreements between the various financial entities. Depending on the agreement, an EFT transaction can take up to two days to actually reflect as a deposit on the statement of the seller. The risk of accepting proof of an EFT as “proof” of actual payment as if it was a cash deposit, puts the seller at a real risk of being defrauded.

Most ordinary citizens do not know that an EFT can be reversed within a few hours after it has been made, depending on the individual financial institute at which the account is held. Devious fraudsters who are know the mechanics of the law and the financial systems in South Africa, use this knowledge to the detriment of others.

How to make payments more secure

In the sale of a motor vehicle, or any other object of which ownership is registered on the eNatis system, the Natis registration document is a very useful instrument to secure and verify payment prior to the transfer of registered ownership.

The easiest safeguard against any risk of loss because of non-payment, is the current, valid and original Natis document, reflecting the registered owner and titleholder of a vehicle.

For as long as the seller of the vehicle retains the possession of the original Natis document reflecting the seller as the registered owner, no fraudster or any other person can obtain registered ownership of the vehicle, unless the seller physically enables them to do so. Once payment actually reflects on the bank statement the necessary documentation should be handed over to effect transfer of registration to the purchaser or his nominee.

Should a seller hand the original Natis registration documents over prior to actual confirmation of payment, the vehicle can be traded and registered to any innocent third party, while the seller still waits for payment.

As no party to an agreement can transfer more rights than they are legally entitled to at that time, the seller will be able to claim the motor vehicle from any person who has such motor vehicle in his/her possession, even if the possessor at that stage has “purchased and paid” the vehicle.  As long as the motor vehicle has not been transferred and registered to a purchaser who has not paid for same, the seller can safeguard themselves in such a fraudulent transaction.

What happens if I’ve been defrauded?

In the event of the payment not coming through, your rights as seller can be enforced by means of a very simple but highly effective application to a court, which can be done with an interim relief order to return the vehicle by the Sheriff of the Court to the registered owner of the car at a date on which service is to be effected on the purchaser. After that, the normal motion procedure is followed. It is also recommended to issue a summons for the cancellation of the agreement, return of the vehicle, cost and interest simultaneously.

For as long as the seller retains and holds on to the original Natis documents on which he/she is reflected as the registered owner of the motor vehicle, the seller will have a definite right to be the entitled possessor of the motor vehicle.

A seller who has already caused registration of the vehicle to be transferred to the purchaser prior to having the payment secured, is left in a risky position. The seller has very little hope of success against such a buyer with the intention to defraud. A litigation process can be prolonged and costly with no guarantee of recovery of the loss.

For further reading, see Unitrans Automotive (Pty) Ltd vs Trustees of the Rally Motors Trust 2011 (4) SA 35, just one of the transactions during a shopping spree of fraudulent transactions using EFTs by a fraudulent purchaser, and other matters referred to in the judgement.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE).

Do it NOW, for LATER

2 - CopyImagine being able to control the future, just by signing a few documents with your attorney now? Get it done sooner, because the dreaded future could come tomorrow.

Drafting a Will is a carefully thought out process, because it is your last wish. By doing it now, you can take your time, and make changes if there are any you want to make.

Make an appointment with an attorney to draft your Will – FREE during National Wills Week (11 to 15 September 2017).

Get started this Wills Week by getting in touch with one of our attorneys.

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