Why Do You Need A Grant Of Probate Or Letter Of Administration In Malaysia
Why do you need a grant of probate or letter of administration in Malaysia and why you need a lawyer.
You are wrong if you are thinking that upon the death of your loved one, you can just walk in to a bank and withdraw the monies standing in his/her bank account.
You can’t even sell or transfer the deceased’s assets such as the immovable properties, unit trusts, stock holdings and motor vehicles etc without first obtaining the “key” to unlock or unfreeze the estate.
Please bear in mind that meddling with the deceased’s estate without legal authority from the court is an offence under the Public Trust Corporation Act 1995 in Malaysia.
THE “KEY” TO UNLOCK / UNFREEZE THE ESTATE/ASSETS
The “key” herein refers to either the grant of probate or the grant of letter of administration issued by the High Court in Malaysia.
Probate is applied for where a person dies leaving a valid will through which an executor is appointed and willingly as well as legally capable to administer the estate.
Letters of administration, on the other hand, are applied for in cases where the deceased dies intestate or partially intestate (the types of estate and the types of letters of administration were discussed in our previous article, namely “What is Grant of Probate and Letter of Administration in Malaysia”)
Upon court’s hearings and the application being granted, the extract of the grant of probate or letter of administration is the key to administer the deceased’s estate and to distribute it amongst all the beneficiaries.
The financial institutions for instance, will require the respective grant from the executor or administrator before closing the deceased’s account(s) or releasing monies from the said account(s).
AUTHORITY TO THE PERSONAL REPRESENTATIVE(S) TO DEAL WITH THE ESTATE/ASSETS
The executor obtains authority to deal with the testator’s affairs the moment the testator dies as the executor derives that authority and power from the testator’s will.
The obtaining of the grant of probate is required as it formalises and validates his actions in dealing with the deceased’s estate.
For the grant of letter of administration on the other hand, the administrator derives his authority and power to deal with the deceased’s estate only upon the court granted the letter of administration, therefore an administrator’s action is always subject to the court’s approval and permission.
For example, an executor may sue on behalf of the estate at any time after the testator’s death as he derives his legal title to sue from the will. Nonetheless, the grant of probate is required before obtaining court’s judgment as the grant of probate will prove and recognise the executor’s position and title.
Conversely, an administrator is not allowed to sue on behalf of the deceased’s estate until the letter of representation is granted and extracted from the court.
An intestate’s property does not vest until the letter of administration is granted by the court to the administrator.
DISTRIBUTION AND ENTITLEMENT TO THE ESTATE/ASSETS
Once the probate or letter of administration is granted, the executor or the administrator may proceed with the duties of administration, starting from collection of the deceased’s assets and payment of the deceased’s debts and liabilities.
After the payment of debts and liabilities, the executor or administrator shall distribute remaining of the assets in accordance with the terms of the will (if any) or according to the Distribution Act 1958 (for non-Muslims died intestate).
In addition to granting the probate or letter of administration, the court is empowered to require the executor or administrator to render proper accounts and/or inventories of the deceased’s estate at the end of the administration, before the executor or administrator can discharge their duties as the personal representative of the estate.
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