Why you should not wait till terminal illness to prepare a will.

Hi people, I received terrible news concerning one of our retirees. She had been processing her retirement benefit for over a year now, gathering the relevant documents and all. Alas the time for payment came, and just a few days after she received approval from Pencom, she passes away. The story was very touching because she had two little ones, but her two sisters were the ones that filed for her death benefit. In Nigeria, ones that happens, then the poor little ones won’t get to share out of the money. If she had drawn up a will, specifically instructing her lawyer to ensure that all her pension benefit and any other payment be legally transferred to her children, then all these quagmire would not have been encountered.

Without a will, next of kin’s would have to apply for a Loa (Letter of administration) issued by a court in Nigeria. Letters of administration are granted by a surrogate court or probate registry to appoint appropriate people to deal with a deceased person’s estate where property will pass under intestacy rules.(intestacy means when a person dies inestate, ie without a will or binding contract, and the value of the property he left behind is greater than any enforceable debt he incurred during his life time or at death) where there are no executors living (and willing and able to act ) having been validly appointed under the deceased’s will.

There is a letter of administration with will, and letter of administration without will. A letter of administration with will is gotten when a testator fails to nominate a person to be the executor of his will or where an executor is expressly named in a will but the named executor is not available or competent to apply for probate. Just to clarify some things, a testator is a person who has written and executed a last will and testament that is in effect at the time of his or her death, an executor is usually a lawyer, hired by a testator to carry out the terms of his will, while a probate is a law process which proves the validity or invalidity of a will. The testator’s will still holds just that if there is problem with the executor, then a letter of administration (with will) will be applied for.

In a situation where the retiree dies inestate, then the relatives or beneficiaries of the deceased must apply for a letter of administration (without will) to access the death benefit from the pension fund administrator. The letter of administration without will is required in order to confer the authority to the relatives of the deceased, to administer or deal with the estate of the deceased property or initiate or defend legal proceedings pertaining to the estate.

Requirements for granting a letter of administration without will in Nigeria:

• Provision under Oath the deceased Affidavits, Bonds or Guarantees with Sureties before such applications can be considered.
• Applicants must file a true declaration of all the personal property of the deceased person with a true value of these properties also stated.
• When the application is received, the applicant would be issued a bank certificate together with other statutory forms, where the bank account balance and the value of shares of the deceased person is stated by the Banks and the Registrars of companies where the deceased person operated or owned shares.

Applying for a letter of administration or a probate is not exempt from taxes, as applications incur a 10% tax of the value of the estate of the deceased. This serves as an inheritance tax. The tax would be paid to the state government where the probate application was lodged and approved.

The advantage of having a will in this situation is that firstly, in a will you can specify the beneficiaries of your pension benefits or any other benefit of yours, but like the Letter of Administration, they would be taxed at a rate of 10% of the value of the estate of the deceased on granting of a probate. Another benefit is that a letter of administration without will is more expensive as applicants are required to provide under Oath, Affidavits, Bonds or Guarantees with Sureties before such applications can be considered. The value of the administrative Bond(s) can be twice the value of the Estate. The latter attracts additional costs and expense especially as the higher the value of the Estate, the higher the expense and the Estate Fee.

So, you would be doing yourself and your loved ones a great dis- service by not preparing your will. Even though we do not pray for it, death is inevitable, and we have to prepare for it. We only pray to be at the father’s bosom and enjoying our eternal peace when it finally comes. So draw up your will now so that you can safeguard your assets for your children or loved ones, and ensure that specific properties are passed on to the person you desire.