South African wills: 20 mistakes that can affect your family

September marks Wills Month in South Africa, yet despite the simplicity of drafting a will, many misunderstand its scope and implications. This confusion often leads to disputes, delays and financial shortfalls for executors. Here are twenty common misconceptions about South African wills and the legal truths behind each.

Firstly, simply stating that one is leaving half of their estate to a spouse in the will is frequently incorrect. In community of property marriages, the surviving spouse already owns 50% of the joint estate, meaning the will can only distribute the remaining 50%. Thus, a will claiming "50% of my estate" actually entitles the spouse to 75% of the total estate. To avoid this, the percentage must explicitly refer to either the joint estate or the deceased’s half.

Another widespread misconception is that an ex-spouse is automatically excluded from a will upon divorce. According to section 2B of the Wills Act, a pre-divorce will is deemed as if the former spouse passed away beforehand – only if the testator dies within three months of divorce. After this period, an unamended will might still benefit the ex-spouse, highlighting the need for post-divorce will revisions.

Furthermore, many believe a will determines the distribution of pension or retirement annuity benefits. However, death benefits from a retirement fund are governed by the Pension Funds Act, Section 37C, which directs fund trustees to identify dependants and decide the distribution, bypassing the will entirely.

Life insurance and retirement annuities also do not automatically go to a deceased estate or will. If beneficiaries are nominated on these policies, the proceeds generally pay out directly to them, irrespective of the will.

One often overlooked point is that even a modest estate can warrant a will. Assets such as homes, vehicles, bank accounts and personal belongings all contribute to an estate, making it crucial to have a will, irrespective of asset value.

A will cannot directly leave assets to minor children. Upon a child's majority, inheritance is held by the Guardian’s Fund, which may limit flexibility. Therefore, testamentary trusts or guardian’s fund arrangements are necessary to manage such inheritances.

Family understanding of one’s wishes does not legally bind executors. Only a validly executed will holds this authority. Moreover, even after a will has been signed, life events like marriage, divorce, or significant asset changes necessitate reviewing and potentially revising the will.

Interestingly, a handwritten note lacks the necessary formalities under section 2(1) of the Wills Act. It must be signed by the testator at the end of the document and on each page, in the presence of two competent witnesses, who must also sign in the testator's presence. Without this, the note is unlikely to be recognized as a valid will and may require costly court intervention.

Additionally, cohabitation does not automatically confer inheritance rights like marriage. Under the Intestate Succession Act, a life partner excluded from a will can be left with nothing. In terms of executorship, an executor cannot commence administering the estate until the Master of the High Court issues Letters of Executorship. Until then, bank accounts are typically frozen to prevent misuse.

In terms of inheritance planning, second marriages require careful drafting to avoid unintentionally excluding children from a first marriage. Mirror wills, where spouses draft similar wills, are not the same as properly coordinated wills, particularly regarding estate masses or protecting the wishes of a first-dying spouse after remarriage.

Lastly, executor’s fees are not fixed. The Administration of Estates Act sets a maximum tariff of 3.5% of the gross estate value plus 6% on income earned after death, plus VAT. This ceiling allows for negotiation but must be agreed upon at the drafting stage, not posthumously. Despite the allure of 'free' will services in September, many institutions require appointment as executor in return.

The estate still bears executor’s fees, commonly at or near the statutory maximum, reducing the family’s control over administration. Finally, a will executed overseas might be valid in South Africa if it meets recognised formalities. However, administering such wills alongside local assets can introduce delays, translation and authentication requirements, which a locally drafted will circumvents.