Letter Of Administration
When a person dies without a Will, then one of the likely beneficiaries will have to apply for the Letter of Administration. Applying for the Letter of Administration is a more complicated process compared to applying for the Grant of Probate because now the courts have to determine:-
- who has the right to administer the estate, and
- who are the rightful beneficiaries
Since the deceased did not have a Will and therefore no one was appointed as executor, one of the beneficiary, will have to petition or apply for a Letter of Administration. Every other beneficiary must agree to the appointment and renounce their rights to petition!
It most cases, the person who has priority over other beneficiaries will be the surviving spouse, children, surviving parent, siblings and this goes on to grandparents, uncles and aunts etc. Sometimes the beneficiaries cannot agree who is to be the administrator thus leading to disputes and delays in the process of unfreezing the assets.
The administrator will have to provide 2 sureties or guarantors for the administration of the estate. These 2 person must have nets assets, equivalent to the value of the deceased’s estate and will stand guarantee in the event that the administrator absconds with the deceased’s assets.
The High Court may (at its discretion):-
- reduce the number of sureties
- reduce the amount of the bond, or
- dispense with the requirement of the bond all together
No surety is required if:-
- a trust corporation is appointed as the administrator
- the gross value of the estate does not exceed RM 50,000
- the administrator is the only beneficiary of the estate
Once all these requirements are fulfilled, the High Court will then issue the Letter of Administration and the deceased’s estate be distributed according to the law of intestacy.
Most people in Malaysia, will go to Amanah Raya Berhad to obtain the Letter of Administration. However do check the fees incurred first. If the estate is small, the total fees charged might be a significant portion of the estate. It also good to check with a lawyer too since each situation is different and in some cases, it may cost less and faster to use a lawyer.
Feel free to contact us should you need help in this area as we can provide some assistance in applying for the Letter of Administration.