The laws of succession fulfil an important economic function as it regulates the transfer of our wealth upon death. Similarly it also plays a very important social function associated particularly with maintaining and protecting our families. We know that professional administration of deceased estates not only addresses the inevitable consequences of death but it also ensures the continuation of quality of life.

Our dreams, hopes and aspirations should be preserved for the benefit of our families and loved ones. When a person comes to the end of his or her life, everything that remains of his or her assets after debts, other obligations and administration costs have been paid passes by inheritance to people qualified to succeed him or her.

The objective should therefore be to leave to our loved ones an estate that is as close to debt free as is possible.

To determine the liquidity of a deceased estate, various factors should be considered in proper estate planning such as the proprietary regime of the spouses.

1 - The executor in the estate of a spouse married in community of property, including the partner of a registered civil union, must deal with the assets of the joint estate and not only the half share of the deceased spouse.

Accordingly, when one of two spouses married in community of property dies the creditors must lodge their claims against the joint estate and are entitled to establish their claims and to receive payment thereof. If the joint estate is unable to meet all the liabilities it is either administered as insolvent under section 34 of the Administration of Estates Act, or it is surrendered or sequestrated under the Insolvency Act.

2 - The proprietary regime of the spouses may fall under the accrual system provided for in the Matrimonial Property Act. This Act provides that every marriage out of community of property entered into on or after 1 November 1984 in terms of an antenuptial contract by which the community of profit and loss are excluded, is subject to the accrual system, except in so far as that system is expressly excluded by the antenuptial contract.

The executor in the estate of a deceased person married by antenuptial contract should therefore check whether the accrual system applies as this may result in an additional claim either by the deceased estate or against the deceased estate. This applies equally to partners registered as a civil union.

3 - Further factors determining the liquidity of an estate that should be made provision for are the administration costs against incurred in the finalisation of the estate, Estate Duty, Capital Gains Tax and claims generally against the estate.