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Master's s 42(2) Certificate

8 May 2014

This article is a critical appraisal of the application of section 42 (2) of the Administration of Estates Act, 1965 (Act No. 66 of 1965), as amended, (“the AOEA”), as conveyed in Registrars’ Conference Resolution (“RCR”) 46/2008 and RCR 41/2012.

RCR 46/2008
RCR 46/2008 not only requires, amongst other things, a Registrar of Deeds to request a Master’s certificate, in terms of section 42 (2) of the AOEA (“section 42 (2)”), for a transfer, by a representative, appointed under section 18 (3) of the AOEA (“section 18 (3)”) , of immovable property, purchased for a price in excess of R125,000.00 (“the determined amount”), but also adds that: “As per instruction form the Master’s Office, the deeds registry should not allow transfer of immovable property in section 18 (3) estates without the approval of the Master. ………”

Section 18 (3) provides that: “If the value of any estate does not exceed the amount determined by the Minister by notice in the Gazette, the Master may dispense with the appointment of an executor and give directions as to the manner in which any such estate shall be liquidated and distributed.” (Emphasis added).

The effect of section 18 (3) is that a representative, appointed under section 18 (3), (“a representative”) who attempts to liquidate and distribute an estate, whose value is in excess of the determined amount, exceeds his/her authority and, therefore, acts unlawfully. Conversely, a Master, who purports to authorise a representative to transfer immovable property, whose value is in excess of the determined amount, exceeds his/her authority and, therefore, acts unlawfully also.

Moreover, section 42 (2) provides that: “An executor who desires to effect transfer of any immovable property in pursuance of a sale shall lodge with the registration officer, in addition to any such other deed or document, a certificate by the Master that no objection to such transfer exists.” (Emphasis added). It is clear, therefore, that a section 42 (2) certificate may only be issued to and executor and not a representative.

Reference may also be made to S 18(3) sales – a response, published in GhostDigest Conveyancing New and Views on 04 March 2010.

In conclusion, I submit that, if, subsequent to a representative’s proper appointment, the value of the estate, including any immovable property which forms part thereof, exceeds the determined amount, the representative’s appointment automatically becomes invalid and should be revoked and replaced with that of an executor.

RCR 41/2012
According to RCR 41/2012 (“the resolution”), a section 42 (2) certificate is not necessary for a transfer of immovable property pursuant to a sale “by the executor of the sole member of a close corporation because “the provisions of section 42 (2) of Act No. 66 of 1965 are not applicable.”

In the absence of an explanation for the latter non-application, I am unable to agree to the resolution because, amongst other reasons, I cannot find any legal basis for

  1. a distinction between an estate of a deceased person, as contemplated in the AOE Act, on the one hand, and the estate of a deceased member of a close corporation as such, on the other hand, and
  2. an exclusion of the estate of a deceased member of a close corporation from the provisions of section 42 (2).

executor”, in section 1 of the AOE Act, “means any person who is authorized to act under letters of executorship granted or signed and sealed by a Master, or under an endorsement made under section fifteen;”. Further, section 13 (1) of the AOE Act provides that: “No person shall liquidate or distribute the estate of any deceased person, except under letters of executorship granted or signed and sealed under this Act, or under an endorsement made under section fifteen, or in pursuance of a direction by a Master. ”

Thabo Nqhome
02 May 2014

Reader Comments: 2
Martin Phalakathsela 09/05/2014:

Thabo what happens in a situation whereby the value of the property is less than R125 000,00 a representative is appointed and that representative sells the property at R150 000,00 or more? Are you suggesting that his letters of Authority be revoked and replaced with a letter of executorship, in light of the fact that in the Inventory the value of the property as will appear from the Valuation Certificate will be reflecting an amount not in excess of R125 000,00?

MANDLA NDLOVU 10/03/2017:

It is common cause that in the deceased estate an inventory must be amended to reflect the correct immovable property description and purchase price. Kindly advise as to who must amend the inventory in the case where the executor is not a seller but a liquidator appointed by virtue of a court order to sell the property of the joint estate of the deceased and his divorced spouse? Please bear in mind that the liquidator was appointed due to the lack of co-operation of from the executor.

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