Succession Planning in Singapore (B24 PSP) PDF

B24 PSP A. SUCCESSION PLANNING IN SINGAPORE \(a) Wills Substantive and foprmal requirements of a valid will s10 WA - **[Gifts]** to attesting witness or to wife or husband of attesting witness to be void **[An executor can be a witness to a will and can be a beneficiary to a will. The restricti...

B24 PSP A. SUCCESSION PLANNING IN SINGAPORE \(a) Wills Substantive and foprmal requirements of a valid will s10 WA - **[Gifts]** to attesting witness or to wife or husband of attesting witness to be void **[An executor can be a witness to a will and can be a beneficiary to a will. The restriction is only as to witness of a will and his/ her spouse from benefiting from under the will.]** **[Note: Referring to persons in wills]** **[Note: Properties that cannot be disposed of in a Will/Gifts that fail]** **[CPF monies]** form a separate estate under section 25 of the CPC CPF Act, so it will not be distributed via the will. It is distributed by nomination. A gift fails if the gifted property does not exist at the testator's death. This is the **[principle of ademption]**. If there is insufficient money to pay cash gifts then the legacies are reduced and this is known as **[abatement]** and each beneficiary takes pari passu. Ademption is where you lose the gift. There is nothing left of it. Abatement is when the gift is reduced. **[Note: Beneficiaries and Class Gifts]** **[Note: Profile of Beneficiaries]** **[Some Succession Issues]** **s30 Civil Law Act** - Presumption of survivorship in regard to claim to property = **[the more senior one is assumed to have died before the junior]** **[s26 Wills Act]** - Gifts to children or other issue who leave issue living at testator's death not to lapse **[s26 does not apply to class gifts s26 applies only to parent and child, not unrelated third party]** s 5 -- 10 of the Legitimacy Act = The right tot property depends on the relative seniority of the children s7 Adoption of Children Act s400 IRDA - Disqualificiation of a bankrupt cannot act as a trustee B. WILLS -- PREPARATION, EXECUTION AND INTERPRETATION 3\. Will formalities **[s9 Wills Act = Witness must be competent at the time of signing, BUT other requirements under s6 must be met.]** if there is anything that is not explicable or if there is anything that is out of order ordinary, the court is likely to require you to file an affidavit of due execution or provide affidavits from relevant persons to explain any oddities. My recommendation is that you should require full signature of the testator and the two witnesses at the end of the page in accordance with section 6(2). **[5. Executors -- who cannot (or should not) be appointed]** 6\. Properties \(b) Considerations for certain types of **[immovable property]** **[(iii) Property subject to mortgages (Section 26 Civil Law Act 1909 ("CLA")) Outstanding mortage to be paid out from the disposed property, unless the Will states that the property is to be received \"unemcumbered\".]** **[7. Construction of wills]** \(c) Construction of **[gifts]** under wills (Sections 21, 24, 25 and 26 WA) s26 - Mark is survived by his own child and therefore inherets from Kim Seng C. INTESTACY **[Without a Will (Intestate)]** 1\. Scope of application of the Intestate Successioin Act (**[ISA]**) s7 of the ISA - **[Rules of distribution]** instestatcy susccession **[Assume that Right of survivorship for property outside of Singapore jurisdiction]** **[2. Issues of illegitimate, adopted, and foster children]** **[s10 ISA]** - Partial Intestacy c/f from s24 Civil Law Act **[Summary distribution]** **[14 Advantageoues of havng a Will]** 2: Ability to choose the Executor and Trustee of one\'s Will and set the terms of appointment. S. 18(2) Probate and Administration Act 3: Minimum number of executors or personal representatives to administer an estate with a beneficiary who is a minor At least 2 administrators for the estate needed D. OTHER ISSUES RELATING TO ESTATES 1\. Inheritance (Family Provision) Act 1966 ("IFPA") \(a) Scope of application; IFPA does not apply to Muslims (Section 1 IFPA) \(b) Principles and procedure -- concept of dependent and reasonable provision of maintenance (Sections 2 and 3 IFPA) **[s3 IFPA - Requirements]** to make IFPA Application? s4 and s6 IFPA - **[Time]** limits = [ **6 months**] s3(2) IFPA -Power for court to order payment out of net estate of deceased for benefit of **[surviving spouse or child]** - **[What]** the Court can order under IFPA? 3(5), 3(6), 3(7), 3(8) IFPA \(d) Interplay between just and equitable division under the Women's Charter 1961 and reasonable provision of maintenance under the IFPA (AOS v Estate of AOT \[2012\] 3 SLR 721 (CA)) 2\. Maintenance of Parents Act 1995 ("MPA") E. PROBATE AND ADMINISTRATION 2\. Practical steps to take when someone passes away \(a) Check if deceased made a will (b) If so, locate the will (search belongings, check with previous solicitors, check registry of wills, advertise in Law Society Gazette and/or newspapers) (c) If original will is not available because it had been proved and deposited in a court outside Singapore, refer to Section 11 PAA and Rule 248 FJR to apply for probate of a duly- authenticated copy. If the original will cannot be found, consider Section 9 PAA (d) If the will is found, determine the validity of the will, and prepare to apply for grant of probate (e) If no will was made, prepare to apply for grant of letters of administration (f) Check whether the executors/potential administrators are willing and able to act (see Sections 13 and 18 PAA) 3\. Obtaining a grant of representation \(a) Main **[types of grant]** Which **[type]** of grant to Apply for? \(i) Grant of **[probate (Testacy) Even if there is a will but no executors who are prepared to act, then the correct Grant to apply for is the Letters of Administration with Will annexed (i.e. Adminstration in accordance with the Will)]** **[Application process]** with the Courts for non-muslim Procedure to apply for Grant of Probate a. To file ex parte OS, Statement (Form 51). CTC of Will (and translation), CTC of death certificate (and translation), renunciation of Lucy, Administration Oath, Affidavit of competency of translator. A checklist will be generated with a provisional reference number. b. Optional whether to carry out probate and caveat searches c. By 4:30 pm of next working day -- to produce original Will at Probate counter for verification d. If documents are accepted by court -- a probate number will be generated; if documents are rejected, to make rectifications. e. Within **[14 days,]** applicant to affirm and file supporting affidavit exhibiting statement, schedule of assets (if available), CTC of Will and death certificate and other documents). f. Hearing date will be provided. If court is satisfied, Order in terms will be made on that day. g. If Schedule of Assets were not previously filed, to file under supplementary affidavit h. Conduct probate and caveat searches i. File request for extraction of Grant Application for Grant of Probate Step 1: Origintaing Summons b\. Estate exceeds S\$5 million in value: Family Division of the High Court c. Estate is less than S\$5 million in value: Family Justice Courts English translation of the Death Certificate + Affidavit from the translator Rule 953 FJR \(ii) Grant of **[letters of administration (Intestacy) = Will but no named executor]** **[Letters]** of Administration \[STEPS\] Application **[process]** Application **[procedure Step 1 - Originating Summons]** Who can apply 1. [Who can apply] for a Grant of Letters of Administration? a. See Section 18 PAA - - Husband, Widow or next of kin b. Toh Seok Kheng v Huang Huiqun \[2011\] 1 SLR 737 at \[23\]: "\...the starting point is that the person who is most suitable among the beneficiaries to be the administrator is determined according to the priorities of entitlement to the deceased's estate under the laws of intestate succession." c. See Section 7 of the Intestate Succession Act 1967 **[If there is a will]** [2. If there is a Will (i.e., grant of letter of administration with will annexed) See Section 13(2) PAA instead] a. Universal or residuary Legatee (i.e. The person to whom personal property is gifted pursuant to a will) b. Legal representative of a deceased universal or residuary legatee c. Beneficiaries under the Will who would have been entitled to a grant if deceased died intestate d. Legatee with beneficial interest e. Creditor Express renunciation [3. Clearing off priority - express renunciations vs constructive renunciations (see Sections 3 to 5 PAA)] a. If the applicant does not have priority obtain renunciations from all parties above the applicant in priority (see Section 3(2)(b) PAA, R 233(5) FJR and Form 53) b. It is not necessary to obtain renunciations from parties within the same class of priority (see Tan Hui Cheng Lily, deceased \[1993\] SGHC106) c. If it is not possible to obtain express renunciations, commence citation proceedings (R 243 and 244 FJR and Form 60) Application for Letters of Administration Step 3A: **[Dispensation of Sureties]** Because cannot find surety \(c) Deceased died domiciled outside Singapore Would that be a need for grants to be made in other countries? And then to create the grant in other countries, would it be by way of fresh grant or would it possible to make use of the reselling process? 5\. Contentious Applications \(b) Issues arising in probate actions 6\. When can personal representatives commence acting for the deceased's estate? \(c) The Wong Moy exception F. THE LASTING POWER OF ATTORNEY AND MENTAL CAPACITY ISSUES 2\. Capacity The **[test]** for lack of capacity (**[s4(1) MCA]**) s4(1) MCA - A person lacks capacity in relation to a matter if at the material time he Section is unable to make a decision for himself in relation to the matter because of an impairment of, or a disturbance in the functioning of, the mind or brain. Section 4(2) - It does not matter whether the impairment or disturbance is temporary or permanent Section 4(3) - Not established merely by (a) age or appearance, or (b) condition or aspect of behavior which leads to unjustified assumptions [s5 MCA - Criteria for unable to make decision] But in the case of BKR whilst the psychiatrist diagnosed the patient has schizophrenia, the psychiatrist also came to the conclusion that the patient was able to understand that information provided to the decision he was able to retain the information. s**[3 MCA General Principles]** Section 3(2) Assume person has capacity Section 3(3) Take all practical steps to help person make a decision Section 3(4) Unwise decision does not equate to lack of capacity Section 3(5) &3(6) Decision made for or on behalf of a person lacking capacity must be in person's best interests Regard must be had to whether the purpose for which act / decision is needed can be as effectively achieved in a way that is less restrictive of the person's rights and freedom of action **[s6 MCA \"best interest\" (s6 MCA)]** s6(2) = Consider all the relevant circumstances s6(3) = The \"future capacity\" when P recovers s6(4) = Encourage P in the participation in the decision making s6(7) = Preserving the property for the remainder of P\'s life 3\. Acts and decisions covered by the MCA **[s14 MCA Gifts by the Donor from the Donee\'s estate]** even if LPA authorises the Donee to make gifts, value of such gifts must not be unreasonable having regard to all circumstances and in particular, the size of the donor's estate, and must have regard to the principle in **[section 6(6) (preservation of donor's property for application towards the costs of his maintenance during his life).]** Donee\'s Defence (**[s7 MCA]**) 4\. Lasting Power of Attorney ("**[LPA]**") **[\[1b\] The Donees Powers and restrictions]** +-----------------------+-----------------------+-----------------------+ |   | Personal Welfare | Property & Affairs | | | | | |   | | | +-----------------------+-----------------------+-----------------------+ | Powers | Code of Practice, | Code of Practice, | | | Section 8.3 | Section 8.4 | | | | | | | Where P will live | Dealing with | | | | property (subject to | | | Who P will live | restrictions under | | | with | LPA) | | | | | | | Day-to-day care | Opening, closing & | | | decisions (e.g. what | operating bank | | | P will eat, drink, | accounts | | | wear) | | | | | Making payments for | | | What social | general expenses | | | activities to take | (e.g. household, | | | part in | medical expenses; | | | | rent; loans) | | | Handling P's | | | | correspondence | Receiving payments | | | | due to P (e.g. | | | Who P may have | dividends, income, | | | contact with | other financial | | | | entitlements) | | | | | | | | Handling tax | | | | matters | | | | | | | | Purchasing vehicles | | | | or other equipment | +-----------------------+-----------------------+-----------------------+ | Restrictions | Sections 13(2)-(8), | Sections 13(9)-(9A) & | | | MCA | 14, MCA | | | | | | | Cannot make | \* If prohibited by | | | decisions on life­ | Form 1, cannot sell | | | sustaining treatment | property without | | | / treatment | court order | | | preventing a serious | | | | deterioration in | Cannot execute will | | | condition | for donor | | | | | | | Cannot do any act | Cannot execute or | | | to restrain donor | revoke CPF | | | (unless donee has | memorandum, CPF / | | | authority to do so, | insurance nomination | | | it is necessary to | | | | prevent harm to donor | Cannot make cash | | | and it is a | gifts (unless | | | proportionate | expressly authorised | | | response) | in LPA) (note: | | | | Section 14(3), MCA) | +-----------------------+-----------------------+-----------------------+ **[\[1c\] Certificate issuers]** Law firm Trainee cannot be an issuer **[\"Family Member test\" Regulation 7(2)]** Family member is defined as a spouse or the person a child of a person, a father or mother of a person, a father-in-law or mother-in-law of a person, a brother or sister of a person, and then the last category. Any other individual who\'s related by blood or marriage and who is living in the same household as the person, right. So the brother-in-law is related to the donor I marriage. I then the question is, is she considered a family member? She would be a family member if he stays in the same household as the donor. \[2\] Procedure Certificate Issuance & Registration **[Duties of the Issuer:]** 1. The donor understands the purpose of the instrument, and the scope of the authority comfort under it. 2. There is no fault or undue pressure that\'s used to induce the donor to create the lasting power of attorney. 3. There is nothing else which would prevent a lasting power of attorney from being created act. 5\. Deputies 1\. Introduction Principles, Best Interests & Other Considerations **[b. Section 24(1) -- who can be deputy =\> 21 years old but \< 60]** **[2. Procedure]** **[Step 1:]** Does Bruce(the P) have mental capacity? Doctor\'s Affidavit & Medical Report must be recent not more than **[6 months]** before the date of the application **[Step 2:]** Is Court permission to appoint needed? a. Section 38(2) MCA, rule 176(2), (3) FJR Section 38(2) says that except for the provisions in section 38 (1) everybody else would need a permission of court before they can apply to be appointed as deputy. Then Rule 176(2) and (3) of the FJR then creates another exception. If the applicant is related to plea by blood of marriage, then permission of the court is not required for the application. b. Para 47(2) FJC PD -- documents are permission of court is not required The FCPD provides that if you\'re relying on the exception that you\'re related to P by either blood or marriage, then documents evidencing this relationship must be provided together with the application to be appointed as deputy c. Para 48(2) FJC PD -- prayer for permission may be included in the main application. d. Considerations -- section 38(3) MCA (3) In deciding whether to grant permission the court is to, in particular, have regard to --- (a) the applicant's connection with the person to whom the application relates; (b) the reasons for the application; (c) the benefit to the person to whom the application relates of the proposed order or directions; and (d) whether the benefit can be achieved in any other way. 3\. Relevant Persons **[Who are \'relevant persons?\']** **[Step 1:]** 1. Persons who have an involvement in P's life and/or who are likely to have an interest in the application. 2. Often, P's immediate family members, by virtue of their relationship to P, are likely to have an interest in being notified that an application has been made to the Court concerning P. 3. Para 50(9), FJCPD: An organisation providing residential accommodation to P is considered a relevant person 64 **[Step 2:]** whether you can obtain their consent or you must serve papers, the applicant application, papers on them. Paragraph 50: paragraph 50 sets out what the relevant persons are and relevant persons are stated to be persons who have an involvement in peace, life and. Or who are likely to have an interest in the application. Relevant person: Relevant persons, for the purposes of the rules, will include the spouse, pea, spouse, peace, children, peace guardians, or parents and MP\'s, brothers or Sister D This the the relevant person can include all these persons that are stated in paragraph 52 50(3) - presumption is that the immediate family member are likely to have an interest concerning P. 50(6) - other relevant persons who are likely to have an interest in the application concerning key and who should be served would include any other relatives or friends who have a close relationship with P. OR Any person who has a legal duty to support P. Any person who will benefit from please estate and any person who is responsible for peace care. so once you decide who the relevant persons are, remember either you need to get their consent, serve the papers of them, or obtain dispensation of service on this relevant concept. **[Documents to be filed in Court]** a\. Para 54 of FJC PD -- OS (Form 217 Appendix A FJC PD), supporting affidavit (form 218), Doctor's affidavit exhibiting medical report (Form 224), consent of relevant persons (Form 221) b. Drafting of prayers -- section 20(4) MCA; para 54(5) of FJC PD - prayers should be limited in scope and duration to what is appropriate or what is required. Para 54(5) the powers must be appropriate for the decision to be made. e.g. care facility or domestic care helper. **[Prayers need to reflect what permission is needed from the Court.]** c. Single affidavit for all applicants -- para 54(8A) FJC PD d. Searches to be conducted -- para 54(8B) of FJC PD -- OPG re LPA, re Metal and Disorder Treatment Act, Wills registry Service of documents a\. On relevant persons (para 50(4) of FJC PD -- OS, supporting affidavits and notice to relevant persons (Form 222)) b. On P -- dispensation (rule 181(6) to (8) FJR/ notification rule 181(3) FJR) - P no longer has mental capacity to understand **[s20(2) read with s22 and s23 - Powers of the Court]** **[4. Restrictions on Deputies]** s25 - Restrictions on powers of deputies Deupty cannot make gifts on P\'s behalf