SinChew Daily Interview (Part 2)
Interview by Sin Chew Daily, one of the most famous Chinese Newspaper in Malaysia.
Lawyer Khoo Ai Theng, P.J.K. (NSDK), Messrs. Ng Kee Way & Co. Managing Partner
Translated From Chinese Version.
Topic: Make A Will To Prevent Family Disputes
No one can predict when he will say goodbye to his love. Many people will do their best when they are alive, hoping to let the people around them enjoy the best life. So have you ever thought about what you can do for your loved ones after death?
Some will make a will first, and this will help to reduce unnecessary trouble for our love one after death; others will decide to donate their organs after death. Either the former or the latter, they just hope to continue their love in the world after death.
Perhaps some people are misunderstood about wills, thinking that a will is a document that must be drawn up only when a family relationship is complicated or they themselves is rich. In addition, Malaysia has the Distribution Act 1958 (Sabah: Interstate Succession Ordinance 1960), so there is no need to do so.
But do you know that our country’s unclaimed heritage has accumulated to RM 40 billion in 2007. Most of them are due to the failure to make a will, resulting in no legal heir to receive the estate.
In our country, once we die, all our asset will be automatically frozen. Regardless of whether or not to make a will, you must go through a specific legal process and only the beneficiary can obtain the asset.
There is a big difference between the legal procedures and processing costs for making a will and not making a will. In case the relationship between the beneficiaries is not good, it will affect the progress of inheritance.
Therefore, making a will is a good choice. First, it can save time and money. Second, you can distribute property according to your own wishes to avoid future family disputes.
1. There are legal procedures for making a will
Lawyer Khoo Ai Theng said that no matter whether a will is made or not, after the death of the deceased, all inheritance will be automatically frozen. However, the time and money it takes to claim an estate varies greatly.
“The legal costs of not making a will are thousands of ringgit more than making a will, and it will take longer to process the red tape. But if you make a will, it will save a lot of trouble and the beneficiaries will get the inheritance faster. .”
She once again emphasized that the executor and witnesses in the will are very important, because these two parties will be involved in the court documents submitted to the High Court.
“After the testator passed away, the witness must prepare an affidavit to prove that he personally witnessed the process of making the testament, and the executor must appear in the high court to let the judge confirm that the person really exists. This is why I encourage the testator to appoint a younger executor and witnesses.”
After the death of the testator, the executor can entrust a lawyer or trust company to prepare relevant legal documents, attach the original death certificate and the will, and apply to the high court for Grant of Probate. After obtaining the probate, the executor can distribute the estate according to the will.
Lawyer Khoo Ai Theng said: “If everything goes well, the executor will usually get the probate after 3 months. However, the processing procedures of the high courts in different regions are slightly different, so the time for obtaining the probate will also be different. “
2. The legal process of not making a will
Malaysia has Distribution Act 1958 (Sabah: Interstate Succession Ordinance 1960), so that the deceased’s estate can be distributed according to law. (Please refer to Chart 1 and Chart 2 for the allocation of inheritance)
“If there is no will, even if there is the Distribution Act 1958, the estate will not be automatically transferred to the beneficiary. The beneficiary must first apply to the High Court for a letter of administration of estate management before using the estate.”
Lawyer Khoo Ai Theng pointed out that most people mistakenly believe that the estate management commission is a letter because its English name is “letter of administration”, but in fact the estate management commission is a court order issued by the High Court to the executor to manage the estate.
“High Court will only deal with property and real estate worth more than RM2 million. There is no difference in the legal process of making a will and not making a will in this case, but the problem arises in appointing executors and guarantors, which also delays the process of inheritance claims. .”
She said that in the absence of a will, all beneficiaries are executors, and the High Court will require all executors to appear in court to apply for a letter of administration for estate management.
“This is very troublesome. For example, if there are 10 beneficiaries, all 10 beneficiaries must appear in court at the same time to apply for the letter of administration.”
Nevertheless, there is a compromise method, that is, the other beneficiaries can jointly sign the document and elect one or up to 4 beneficiaries to be the executor of the estate.
In addition, High Court will appoint the executor to appoint two guarantors to ensure that the property is distributed to all beneficiaries, and the guarantor cannot be the beneficiary or executor.
“This creates another problem. The net worth of the two guarantors must be equal to that of the deceased. Of course, they can also apply to the High Court for exemption from this regulation, provided that all beneficiaries must sign a documents and agree.”
On the other hand, the Unit Pembahagian Pusaka or the Land Bureau (Pejabat Tanah) under the abatan Ketua Pengarah Tanah dan Galian has the authority to deal with asset with value of less than RM 2 million in accordance with the Small Estate (Distribution) Act 1055 Ringgit real estate or estates with a total value not exceeding RM2 million, but only if there is property.
“The executor must seek assistance from the relevant regional department based on the real estate address. Except for the need to appoint two guarantors, the other procedures are the same as the legal procedures without a will, but all beneficiaries must take the time to attend the hearing.”
Lawyer Khoo Ai Theng revealed that if it is a small estate, the beneficiary can apply to the small inheritance unit or the Land Bureau on his own, without having to entrust a lawyer or professional to handle it. If the application is successfully approved, officials of the Land Bureau will issue an allocation instruction (perintah pembahagian) to the executor to deal with the estate.
In addition, the public trust company (Amanah Raya) under the jurisdiction of the government can also handle inheritance matters, but it is limited to the handling of movable properties under RM600,000 , such as cash, stocks, fixed deposits, etc. If it exceeds, it will be referred to High Court.
Have made a will vs. Have not made a will
Legal procedures (simplified version)
●Legal procedures for having a will:
Processing location: High Court
Procedure 1: Entrust a lawyer or trust company to prepare legal documents and apply to the High Court for the date of appearance.
Procedure 2: The executor appears in court accompanied by a lawyer or professional, and applies to the high court for grant probate.
Procedure 3: After obtaining the probate, the executor can execute the contents of the will.
●Legal procedure for not having a will:
[Scenario 1: Real estate more than RM2 million, property (no limit)]
Processing location: High Court
Procedure 1: Entrust a lawyer or trust company to prepare legal documents.
Procedure 2: Appoint an executor and two guarantors. (If the beneficiary cannot reach a consensus, or cannot find two guarantors whose net worth is equivalent to that of the deceased, progress will be delayed)
Procedure 3: The lawyer or trust company applies to the High Court for the date of appearance.
Procedure 4: The executor appears in court accompanied by a lawyer or professional to apply for a letter of administration for estate management. (If there is no guarantor, apply to the High Court for exemption from the guarantor regulations)
Procedure 5: After obtaining the letter of administration for estate management, the executor must allocate the estate in accordance with the Distribution Act 1958.
[Scenario 2: Real estate is less than 2 million ringgits / total estate value is less than 2 million ringgits (must have real estate)]
Processing location: small inheritance unit or land bureau
Procedure 1: The beneficiary goes to the authorities to fill in the application form/appoint a lawyer or trust company to handle it
Procedure 2: Appoint an executor.
Procedure 3: On the day of the hearing, all beneficiaries must show up for the official to verify their identity, unless they have signed a consent statement (Surat Akuan Persetujuan)
Procedure 4: After the authorities issue a distribution instruction, the executor can distribute the estate according to the Distribution Act 1958
For details, please refer to http://www.kptg.gov.my/?q=ms/content/pembahagian-harta-pusaka-kecil
[Case 3: Only Movable Property under RM600,000]
Handling location: Public Trust Co., Ltd.
For details, please visit http://www.arb.com.my/bm/index.asp
Sin Chew Daily. Report: Guo Huijun. 2015.12.08