Estate Division Trusts
Dividing Estates between the heirs can be complex. This complexity is generally due to, the nature and extent of the property forming part of the estate itself, the number of heirs involved and the dynamics of the relationship between them. Because of such complexities, there is a huge risk of leaving whole or parts of the estate undivided between the heirs and therefore in suspension. This risk arises even when all the parties involved are in good faith and get along between them, since some estates are just too cumbersome to administer. Needless to say, this risk is enhanced further when heirs disagree between them. Estate Division Trusts resolves such issues.
Estate Division Trusts will mitigate such a risk by simplifying the process by which an estate, even a very complex one, devolves onto one’s heirs. Trusts can serve the purpose of ensuring that the estate is passed on to the heirs as one had intended, in an effective and smooth manner. Establishing such a Trust would result in an independent professional taking control and possession of the estate with the main purpose of dividing the estate between the heirs, in accordance with one’s intentions. This does not only simplify the management of the estate itself, since this is being handled by one professional in the interests of all heirs, but it also minimises the risk of having different heirs with diverging interests not agreeing on how the estate is to be divided.
Some of the highlights of using such a Trust are the following:
- • The Trustee will be the legal owner of the estate following one’s demise with the aim of dividing the estate between the heirs – Thus, there will be no need for all heirs to be involved in identifying the whole estate and then dividing it;
- The Trustees will administer the property forming part of the estate in a professional and knowledgeable manner;
- The Trust may contain rules on how the property forming part of the estate is to be divided between the heirs – these rules may be as detailed as one wishes;
- The Trustee may be given various powers over the estate, e.g. the power to sell immovable property – this ensures that property may be liquidated before dividing it between the heirs thereby avoiding disagreement and unnecessary tensions;
- The Trust will be purely administrative and will follow the rules set out in the relevant Trust instrument with the final objective of distributing the estate to the heirs;
- Upon the distribution of the estate in accordance with the rules set out in the Trust, the Trust terminates as it would have reached its goal.
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