Sales from estates

There has been an ongoing debate as to whether the Master of the High Court needs to consent to sales of immovable property from a "section 18(3) - estate", and what proof the Deeds Office requires to ensure that the estate does not exceed the present limit of R124 000,00, notwithstanding RCR 3 of 2003.

A letter from a retired Cape Town Master confirmed that should a sale from the estate exceed the limit of R125 000, 00 then it must be referred back to him for the appointment of an executor. It has, however, been confirmed that this only applies to sales directly from the estate, and not to a follow-on sale. In other words where there is a so called "same day" transfer and the heirs in a "section 18(3) estate" transfer the property for a higher value, then no further deeds office examination queries need be made, questioning the section 18(3) procedure.

However, the question now begging an answer is how does the Deeds Registry know that the sale of the immovable property is within the R125 000, 00 limit? After all it can quite conceivably happen that a property is valued at just below R125 000, 00, yet the other assets such as cars, etc, might cause the estate to exceed the limit, having the result that the more formal procedure of appointing an executor must be followed.

According to the said Master, his office now issues appointment certificates which list all the assets, and from such document it can then be ascertained what the value of the estate is. Since it is not a requirement to lodge these appointment certificates for section 18(3) - transfers, this information is not available to the deeds examiner.

Two schools of thought exist in this regard. Firstly, in the case of a sale of immovable property from the estate administered in terms of section 18(3), the Deeds Office examiner should call for the appointment certificate by the Master's representative to ascertain whether the sale falls within the ambit of section 18(3). If it appears from such a certificate that the combined value of the immovable property and any other assets in that estate will have the result that the maximum amount allowed for section 18(3) is exceeded, the matter has to be referred back to the Master for the appointment of an executor. This has in fact been suggested by the Master.

Secondly, the Deeds Office should not concern itself with this issue as regulation 44A(c) covers the deeds office in that the conveyancer, who has signed the preparation clause, has accepted responsibility that "such person has in fact been appointed in that capacity (Master's Representative) and is acting therein in accordance with the powers (that is not to act if the estate exceeds the maximum value permitted by his appointment) granted to him" (my parenthesis).

This is a contentious issue and readers are urged to provide their views thereon - Editor

Republished with permission from SA Deeds Journal

Leave a comment:

Security Picture (click to change)
Word shown in picture:
menu close

Search Articles