Letters of Wishes in Estate Planning | Legal Articles

 

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Letters of Wishes in Estate Planning

Letters of wishes (sometimes referred to as a Memorandum of Wishes) are non-binding documents that provide guidance of the estate planning documents.

It also allows the Last Will and Testament or the Trust instructions to remain flexible and broad.

Letters of Wishes in Estate Planning

The role of Letters of Wishes in estate planning include:

  • Will - It provides guidance to the Executors and the trustees of Trusts established under a Will.
  • Minor children - It provides guidance to the guardians of minor children appointed under a Will.
  • Potential contentious estates - It provides reasons as to why a certain beneficiary is not named in the Will.
  • Discretionary family trusts - It provides guidance to the Guardians, Appointees and Trustees.
  • Charitable giving - It provides the beneficiaries named in the Will with an understanding that the Testator - the person who has made the Will - intended for them to pass a certain portion of the estate to preferred charities.

The Importance of an Estate Attorney

The drafting of Letters of Wishes should be done with an Estate Attorney so that they are not deemed as informal wills. If the Letters of Wishes are drafted incorrectly, they may cause complications with the main Will and expose the estate to litigation.

In an instructive case study, Taylor v Taylor 2012 (3) SA 219 (ECP), a myopic and badly planned estate had led to a dispute between the members of the family.

The testator died in 2006, leaving behind his three children (who were the applicants in the litigation), his surviving spouse (the step-mother of his children) and a substantial house in Port Elizabeth, among many other assets.

When reading his Letters of Wishes (which he dated and signed seven weeks before his death) it became clear that the testator intended for his widow to be allowed to remain in the house after his death, and for the additional property to be rented out in order to generate an income that covers the expenses of the house.

However, the Will itself said nothing about the widow being entitled to remain living in the house after the testator's death. Leaving his children with no legal obligation to allow their step-mother to remain in the house for the remainder of her life.

And because the testator was not guided by his estate attorney, he drafted his letter of wishes incorrectly.

When done correctly, the Letters of Wishes should:

  • be addressed to the correct person
  • contain a statement to the effect that the testator understands that it is unenforceable
  • state that it is not to be read as a formal testamentary document
  • be marked as private and confidential

On the other hand, the Letters of Wishes should not:

  • fetter a trustee's discretion
  • contain directive language
  • impose any legal repercussions if it is disregarded

If a professional had been involved, he or she would have known that the family dynamic is delicate, and that the testator had to balance the expectations of his children while providing a lifetime of financial support for his surviving spouse.

Van Deventer and Van Deventer Incorporated | Estate Attorneys in Johannesburg

As a result of not having an estate attorney, the testator's children had decided not to let their step-mother remain on the property. Van Deventer and Van Deventer Incorporated.

Contact Van Deventer and Van Deventer Incorporated today, for estate attorneys in Johannesburg that will help to avoid conflict and family feuds after you are gone.

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