This blog offers a practical guide for executors on how to handle claims against an estate in cases of disputes or when the executor is uncertain about the validity of a claim. Section 32 of Act 66 of 1965 is particularly important as it provides the executor with options and the authority, with the permission of the Master, to request the claimant to appear before the Master. This allows the executor to question the claimant and assess the validity of the submitted claim.

Introduction




Outlining the procedure in submitting a claim

Once authorised to act, the executor assumes the responsibility of publishing a notice in accordance with section 29 of the Estates Act. This notice must be published in the Government Gazette and in a local newspaper circulating in the district where the deceased resided at the time of their passing. The purpose of this notice is to inform individuals with claims against the estate to submit their claims to the executor within a specified period. The notice must be published for at least 30 days but not exceed three months from the date of the last publication.

Section 29(2) states that all claims that would be provable in the event of insolvency can be lodged against the estate. To assess the estate's solvency, the executor typically examines the deceased's documents and consults with family members to identify any outstanding creditor claims.

Under section 34 of the Estates Act, it is the executor's responsibility to assess the estate's solvency. Also, this means that any claim with a specific monetary value, known as a liquidated claim, can be submitted against the estate. Such claims may include outstanding loans, unpaid services, or goods sold to the deceased. These claims typically arise from agreements in which the deceased was involved and involve fixed amounts. Other claim amounts, like maintenance claims from surviving spouses or dependent children, need to be determined and are usually resolved through negotiation between the executor and claimant.

Subsections of Section 34: the disputed claim 

According to section 32(1) of the Estates Act, if the executor disputes a claim, they have the option to request the claimant to provide an affidavit supporting their claim.
Section 32(1) also states that, upon obtaining the consent of the Master, the executor has the authority to summon the claimant or any other individual deemed by the Master to possess pertinent information about the claim. The purpose of this summons is to conduct an examination under oath, which may take place before the Master, a Magistrate, or another Master designated by the Master. It is important to note that such an examination can only be conducted with the explicit consent of the Master.

According to section 32(2), in the aforementioned examination referred to in subsection 32(1)(b), the person being examined can be questioned by the presiding Magistrate or Master, as well as by the executor, any heir, or the attorney or advocate representing them.

Section 32(3) states that if the claimant, without a reasonable excuse, fails to comply with the notice given under subsection 32(1), or after appearing in response to any subsequent notice, refuses to take the oath, undergo examination, or provide satisfactory answers to lawful questions, their claim may be rejected.

Under section 32(4), it is required that any Magistrate or Master conducting the examination ensure the creation of a record of the proceedings. Upon request, the executor or claimant, at their respective expense, shall be provided with a copy of the record.

Practical outline of the disputed claim procedure

1. Request the claimant to submit an affidavit within 14 days, detailing the claim, including its start date, grounds/reasons, and the amount owed. The affidavit should be accompanied by supporting documentation. Inform the claimant that, in accordance with section 32(1), you reserve the right to request the Master's consent for an inquiry to be conducted before the Master or a nominated Magistrate. Additionally, draw the claimant's attention to sections 32(2)-(4) outlined in the previous section of this blog.

2. Upon receiving the affidavit and supporting documentation, review the information to determine if it is sufficient for making a justifiable decision. If not, proceed with section 32(1) and submit a written request to the Master, via registered post or courier, seeking consent for the claimant to appear before the Master for questioning regarding the validity of the claim. In this letter to the Master, mention the claimant's failure to provide adequate information and attach a copy of the exchanged correspondence as evidence. Request the Master's written consent to summon the claimant and/or any other individuals with material information to appear before you, at a mutually agreed place and time, for examination under oath. Also, seek the Master's permission for the estate to bear the costs of the examination (excluding claimant-incurred costs). You may suggest conducting the examination in front of the Master rather than a Magistrate and propose suitable time slots, or contact the Assistant-Master to arrange them.

3. Once you receive the Master's written consent with the requested information, proceed to summon the claimant and/or other individuals to appear before you at the agreed-upon place and time. Notify any other individuals identified by the Master as having material information to also appear before the Master.

4. In your letter to the claimant, reiterate section 32(2), highlighting that the examination allows questioning by the presiding Master, yourself as the executor, any heirs, or the attorney/advocate representing the executor or heirs. Refer to section 32(3), stating that failure to comply with the notice, refusal to take the oath, submit to examination, or answer lawful questions fully and satisfactorily may result in the rejection of the claim.

5. Note that, as per section 32(4), any Magistrate or Master overseeing the examination will keep a record, which can be furnished to the executor or claimant upon request, at their respective expenses.

6. Send a copy of this letter, addressed to the claimant, to the Master for their reference.

7. Keep in mind that, as Meyerowitz (paragraph 16.7) points out, the examination is not a trial, and the Master or Magistrate's role is not to judge the facts but to supervise and maintain a record of the proceedings.

Conclusion

The role of the executor in handling claims against the estate entails a meticulous evaluation of each claim to determine its validity. In some instances, the executor may request the creditor to provide supporting evidence for their claim, ensuring a thorough assessment.

To gather further information, the executor possesses the authority to request a sworn affidavit from the claimant. This affidavit should comprehensively outline the origin of the claim, the underlying reasons, and the precise amount being sought.

Moreover, the executor is empowered to conduct an oath-based questioning of the claimant, either in the presence of the Master or a Magistrate. These procedures, when compared to full-fledged litigation, are streamlined and less formal, facilitating a smoother process.

In essence, the executor bears the responsibility of diligently evaluating each creditor's claim against the estate. They may request additional evidence, engage in questioning the claimant, and ultimately make the determination of whether the claim is accepted or rejected. Adherence to proper procedures and ensuring fairness throughout the process are of paramount importance for the executor.

Sources
Estate Administration Act 66 of 1965
Meyerowitz D The Law and Practice of Administration of Estates 5th ed (Juta Cape Town 2010)
Van Niekerk v Van Niekerk 2011 2 SA 145 (KZP)