Wills Malaysia Online



July 3, 2012

Letter of administration

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Written by: Lauren

Everyone knows the importance of having a Will but not everyone would go out and write one immediately. In fact, it is common that despite knowing the importance of having a Will, many still do not write them and there has been countless cases where one dies without leaving a legal Will that eventually caused a lot of hardship for the family members that include frustration, in-fighting and such.

Where this is concerned, a fair distribution of the person’s assets and properties would still be needed to be carried even if there is no legal Will present. In situations like these, the court will have to intervene so that this situation can be resolved in the shortest time possible without causing any additional problems.

In a situation where the Will is written and admitted by law, the grant of probate is given and that is when the court allows the Executor to carry out the instructions as stipulated in the Will. However, if there is no Will written, the whole process becomes longer and more complicated. In Malaysia, the Letter of Administration can be obtained through most lawyers while it is also common that many has done so through Amanah Raya Berhad.

This means that a Letter of Administration must be issued by the court. One of the beneficiaries who would be receiving a portion of the assets would need to apply for the Letter of Administration from the courts and this is where it gets complicated.

The courts will then have to identify and determine certain issues like the person who has the right to administer the estate. This refers to the person who will be handling the estate and any other related assets. Additionally, the courts will also need to determine who the right beneficiaries are who would be receiving any part of the estate. This could be the family members, spouse, or any other related parties.

Essentially, without a Will there would be no Executor appointed. This means that someone must be appointed to carry out the administration of the estate. In most cases, a member of the family or someone who is a beneficiary will apply for the Letter of Administration from the courts.

To do this, the person must apply or petition for the Letter and this must be done fairly. In most cases, family disputes are known to arise from who should be allowed or appointed to apply for the Letter of Administration so the most common practice is to allow the surviving spouse to do so.

However, families who can agree to allow a particular member to apply for the Letter of Administration could do so because that is the pre-requisite. This means that the family members could also collectively denounces the rights of the person to petition for the letter with the courts.

In situations like these, the surviving spouse would have priority over all other family members that include the children, parents or siblings and others. This is to ensure that the administrator is as neutral as possible.

To apply for the Letter of Administration, the administrator would need to provide 2 sureties or guarantors in order to be eligible to administer the estate. The 2 individuals would need to have net assets which are more or equivalent to the value of the estate of the deceased which will be used as guarantee if the administrator absconds.

There are situations where sureties are not required and this is when instead of a person, the administrator’s role is given to a trust corporation. Apart from that, if the gross value of the estate of the deceased is not more than RM50,000 and when the administrator is the sole beneficiary of the assets of the deceased are also factors where sureties are not needed.

Consequently, the court could also at its discretion give allowance based on each case lesser number of sureties or reduce the amount of the bond as well as allows that no bond is needed at all. The Letter of Administration is then issued by the court once all the requirements are fulfilled which will then allow the administrator to distribute the deceased’s estate according to the rightful and legal process.