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The content and format of the Liquidation and Distribution Account is laid out in detail in section 35 of the Administration of Estates Act 66 of 1965, and even further specified in the Act’s Regulations. There have also been several Directives issued by the Master of the High Court in recent years to provide further guidance on how to draft the document.

The question is then: what is a Liquidation and Distribution Account and why is it so important? A comprehensive discussion about the administration of deceased estates can hardly be complete without referencing the Liquidation and Distribution Account, or the L&D as it is often abbreviated. Simply put, the L&D is a summarised statement of the assets of a deceased estate and the transactions around them. It lists what assets and liabilities there are, and is used to calculate if there is enough cash to cover the various liabilities. Most importantly, it also shows how the assets in an estate are distributed to heirs. 

The L&D is generally finalised when all the assets are collected and the Executor, or the professional agent assisting the Executor, has all the necessary figures needed for accurate calculations. It must ordinarily be submitted to the Master of the High Court within six months of the Letters of Executorship being issued for an estate, however, it is possible to request an extension in reasonable circumstances where there have been delays in that process.

Once the L&D has been signed by the Executor, there are still a few steps that need to be carried out. First, it is submitted to the Master’s Office for approval. The Master’s Office has a supervisory role in the deceased estate process to ensure everything is done according to the letter of the law, and heirs are not prejudiced in any way. Because of that, the Master’s Office will scrutinize the document and can often raise queries about any aspect of it, including calculations, expenses, and distribution to heirs. It is then usually necessary to answer these queries and submit supporting documents before moving on to the next phase. 

Once the Master’s queries have been satisfied and the supporting documents submitted, the Master will give the green light to proceed with advertising of the L&D. A copy of the L&D must lay open for inspection at the offices of the Magistrate’s Court in the district where the deceased was normally resident, for at least 21 days, as well as at the Master’s Office. It must be advertised in the Government Gazette and a local newspaper that the L&D is laying open for inspection for any person with an interest in the estate to go view it. This is done to give anyone a last opportunity to object to its contents or the distribution of the estate.

Finally, once the account has lain open for inspection for 21 days and with no objection, the Magistrate’s Court issues a certificate to that effect. Then the estate’s assets are distributed to the heirs in accordance with the L&D.

Contact Jeanne Stander at jeanne@curranattorneys.co.za for any questions regarding the deceased estate administration process.