PVL2602 EXAM PACK.

PVL2602 EXAM PACK. Distinguish between and estate and the residue of an estate. (4) Estate = A testator's estate consists of the assets and liabilities. Residue of an estate = Refers to that part of the deceased's estate which remains after the payment of funeral expenses, administration costs, tax, the testator's debts and the legacies. 3.1 If testator signed with a thumb print – in other words, he made a mark. When a testator signs with a mark the requirements of s 2(1)(a)(v) must be met. This means that a commissioner of oaths must append a certificate to the will certifying that he has satisfied himself as to the identity of the testator and that the will so signed is the will of the testator. Since the certificate is absent, the will is not valid. 4.1 Mention the requirements for the establishment of a valid trust. (6) For a trust to be valid, the following requirements must be met: 1. The founder must intend to create a trust. 2. The creation of the trust must be by means of a written agreement, a testamentary writing or a court order. 3. The trust property must be reasonably clearly defined. 4. The trust must be established for an object of purpose, that is the trust property must be intended to be applied for the benefit of a specific or determinable person(s), or with an eye to a determined or determinable aim. The trustee may be authorised to appoint beneficiaries from a specified class of persons designated by the testator. The object or purpose of the trust may not conflict with a particular legal rule, boni mores or public policy. 4.2 Write a note on the variation of trust provisions by the court. Include a discussion of Minister of Education v Syfrets Trust Ltd 2006 (4) SA 205 (C) in your answer. (15) Section 13 of the Trust Property Control Act 57 of 1988 extends the power of the court to vary trust provisions. If a trust instrument contains any provision which brings about consequences which, in the opinion of the court, the founder of the trust did not contemplate or foresee (1) and which (1) hampers the achievement of the objects of the founder,(1) or (2) prejudices the interests of the beneficiaries, (1) or (3) is in conflict with the public interest,(1) the court may, on the application of the trustee or any person who in the opinion of the court has a sufficient interest in the trust property, delete or vary any such provision or make in respect thereof any order which the court deems just.(1) This may include an order whereby trust property is substituted for other property, as well as an order terminating the trust . Ex parte President of the Conference of the Methodist Church of Southern Africa: In re William Marsh Will Trust.(1) In 1899 the testator left his estate in trust to his son to be used for the establishment of homes for "destitute white children". The court decided that the testator did not foresee that economic circumstances would change to such an extent that the number of white destitute children would become so few that his charitable intention would be frustrated. The court also decided that it would not be against public policy to accept children of all races into these homes. The court accordingly ordered the rescision of the word "white" from the will.(1) It is no longer a requirement that there should have been a change of circumstances unforeseen by the founder, but the Act does require that the consequences of the trust provisions should have been unforeseen by the testator Therefore, if the trust provisions prejudice the interests of the beneficiaries, but this has been foreseen by the founder, the court cannot vary the trust provisions.(1) In Minister of Education and Another v Syfrets Trust Ltd NO 2006 (4) SA 205 (C) the court had to decide on the validity of a trust. The trust, created in 1920, provided that only white, non-Jewish men may be beneficiaries of the trust. (1) The validity of these provisions were challenged in 2002. The applicants based their application for an order deleting the discriminatory provisions on three Grounds: (a) Section 13 of the Trust Property Control Act (1) (b) Common law, which prohibits bequests that are illegal, immoral or contrary to public policy (ie contra bonos mores). (1) (c) The Constitution, specifically the equality and anti-discriminatory provisions of section 9. (1) The Court granted the application, because the provision was considered to be contra bono mores.(1) The Court held: The principle of freedom of testation cannot be ignored, but there are limits to freedom of testation. One of these limits is the common law principle that provisions that are contra bonos mores may be deleted. (1) reflected in the foundational constitutional values of non-racialism, non-sexism and equality.(1) The Court may order the deletion of discriminatory provisions of a will based on its common law power to delete provisions in a will that are against public policy.(1) Not all clauses in wills or trust deeds that differentiate between different groups of people are invalid. It is only where the differentiation can be considered to be unfair discrimination on the grounds of race, gender and faith that they can be held invalid and be deleted.(1) = (17) (max 15) OCT / NOV 2015 2.1) In Hassam v Jacobs NO (1) the Court held that the word “spouse” as used in the Intestate Succession Act 81 of 1987, includes a surviving partner to a polygamous Muslim marriage. We have to calculate a child’s share in order to work out how the estate will devolve as a spouse is entitled to a child’s share or R250, 000, whichever is the greatest. A child’s share is calculated by dividing the estate by the number of the deceased’s children who have either survived him , or have predeceased him but are survived by descendants plus the number of surviving spouses. The Bhe case amended the calculation of a child’s share when a deceased is survived by more than one spouse, in that a child's share would be determined by adding all the surviving spouses (i.e., not “plus one”, but “plus the number of surviving spouses”., J died so she is not included but k her daughter will be included Each woman will get more or less the amount gazetted by the minister of Justice. Each wife gets R250 000 - X is survived by 3 wives (excluding J ) = 3 x R250 000 ( amount fixed by Minister ) = R750 000 - X estate is R800 000 – R750 000 = R50 000 - R50 000 is the residue after excluding the child’s portion therefore we divide it among the surviving children of the deceased i.e. Y (since E died Y inherits E’s share ) , F , Z ( Adopted son) ,H and K - R50 000 /5 = R10 000 ….Each child gets R10 000 2.2) Signing of the will is a requirement for the validity of the will. Can be done in 3 ways: ; The testator himself may sign the will with his signature. ; The testator may also sign the will by making a mark. ; Some other person may sign the will on behalf of the testator However the use of any writing other than the person’s name does not qualify as a signature and constitutes a mark Refer to section 2(1)(a) of the Wills Act Case; Harpur v Govindamall - the court held that initials constitute a form of a mark and also that a witness’s signature using initials invalidates a will M may have a claim of maintenance in terms of the Maintenance of Surviving Spouse Act 3.1 Amendment involves the addition, deletion, alteration or interlineations by the testator and Revocation means to cancel a will. There are a variety of ways to do this. A will can be cancelled by expressly doing so or it can even be possible to cancel a will by implication 3.2 Failure of a legacy A legacy will lapse or fail in the following circumstances: DI RAID i) Ademption: If a testator voluntarily alienates the object of a legacy in his lifetime, the legacy lapses. a. failure of a legacy by ademption depends on the testator’s presumed intention. The presumption may therefore be rebutted by evidence of the testator’s actual intention b. If the object of the legacy has been alienated and the testator did not have the intention of revoking the bequest, the legatee is entitled to the value of the legacy or to the bequest itself if the executor is able to recover it ii) If the legatee dies before the legacy vests in him iii) If the legatee repudiates the legacy. iv) If the legatee is incompetent of inheriting under the will. v) If the bequeathed thing is destroyed. vi) If the testator’s estate is insolvent.