Sample Letter of Administration Malaysia: When you pass away and there’s a will, you’ll be needing a grant of probate (GP). However, if there’s, unfortunately, no will, then it’s a letter of administration (LA) that’s needed. If there’s a will, then a grant of probate (GP) is the document you need. If there’s no will (or that will is invalid), then you’re talking about a letter of administration (LA). These important legal instruments are both parts of a set of steps, which authorize and trigger the process of estate administration, also known as settling a will. Since each one is an important instrument, it’s also a process that’s filled with lots of legal jargon and complicated procedures. We’re going to be breaking down all the jargon behind estate administration, and the all-important letter of administration.
Sample Letter of Administration Malaysia: What’s the legal jargon all about?
It’s good to understand the legal jargon to start off with. The process of applying for a GP or LA covers a whole range of key legal terms, which are referenced heavily in the Probate and Administration Act Malaysia.
Here’s a quickfire list of essential terms that are valuable to know:
- Testator – the person who writes a will, i.e. the deceased individual whose estate is subject to administration.
- Executor – the individual named on the will to administer it upon the testator’s death. Ensuring that the wishes of the deceased followed EXACTLY. There can be more than one named executor.
- Administrator – the person(s) designated to administer the estate if no executor of the will is named.
- Grant of probate (GP) – a grant of permission issued by the High Court to the named executor(s) of a will. Empowering the executor to administrate the testator’s estate.
- Letter of administration (LA) – in cases where there’s no will, a grant of probate replaced by a letter of administration in Malaysia.
- Summary administration – a legal instrument in which the executor requests to remove from the responsibility of executor, for estates that are valued at less than RM600,000.
The grant of probate and letter of administration apply to non-Muslim citizens in Malaysia. The nation’s Islamic citizens require a Faraid Certificate from the Syariah High Court. In this case, the estate distribution is carried out according to the Faraid Law, or consensus.
What is the process for a letter of administration (LA)?
There are three ways in which a request can made for a letter of administration in Malaysia. The first route is via the High Court. An LA must file along with the following documents:
- Death certificate
- Details of the applicant
- List of assets and liabilities of the deceased individual
- List of potential beneficiaries
- Note of any interest of the applicant
This process can take anywhere between six months to over two years! To add to the complication for an LA following this process, in the event that an estate valued at over RM500,000. The applicant must provide TWO further sureties.
The term ‘surety’ (the plural for that is ‘sureties’) is essentially a third-party who acts as a guarantor, which means that he/she will be responsible for paying the debt in case the applicant decides to disappear!
These sureties must be resident in the relevant Malaysian authority and have assets roughly equal to the value of the estate. You basically need two friends and/or family members with an estate worth approximately the same as the value of the testator’s estate. Once the LA has been received, the administrator may transfer all assets from the estate to their own name. And then, distribute accordingly. You can see why those sureties are quite useful! The administrator required to apply to the High Court for confirmation on the distribution, as per the Distribution Act 1958.
The second path is available to estates valued below RM600,000, which eligible for administration through Amanah Raya Bhd, which is the Government-owned public trustee. This can take four to six months for estates with movable property. For example, cash and cars, or up to one year for estates with immovable assets such as property.
Sample Letter of Administration Malaysia: The grant of Letter of Administration
Sample Letter of Administration Malaysia: A grant of Letter of Administration is a grant issued by the High Court of Malaya allowing the person granted with the Letter of Administration to administer the estate or assets of the Deceased in a situation where the Deceased has died without leaving a valid will. The application for the grant of Letter of Administration will have to made to the High Court.
The followings are the procedure for applying for the grant of Letter of Administration:
Step 1 filing of the cause papers
The appointed lawyer will prepare the followings documents to file in the High Court. Ex Parte Originating Summons praying for the person named therein to grant with the Letter of Administration; Affidavit In Support of the Ex Parte Originating Summons; Notice of Appointment of Solicitors; List of assets of the Deceased; List of liabilities of the Deceased; Renounciation; and administration Oath.
Step 2 hearing of the Ex Parte Originating Summons
Sample Letter of Administration Malaysia: Once the above is filed the High Court will process the documents and will seal the Ex Parte Originating Summons with the seal of the High Court. The High Court at the same time will fix a hearing date for the Ex Parte Originating Summons. The Ex Parte Originating summons will then heard in the High Court before a Registrar and the intended administrator or administrators will have to be present in Court for the hearing. The Registrar upon being satisfied that the papers filed are in order will grant an order in terms as per the Ex Parte Originating Summons. For example, will grant the Letter of Administration to the person or persons named.
Step 3 dispensation of sureties
Section 35(1) Probate and Administration Act 1959 requires the applicant for the letters of administration to provide two sureties who have assets within the jurisdiction equivalent to the amount of the Deceased’s estate as security for the due administration of the estate. Due to the difficulties in finding the required sureties, the applicant for the Letter of Administration will usually advised to file an application for dispensation of sureties to dispense with the requirement of Section 35(1) Probate and Administration Act 1959. And, it usually will be granted by the Court.
Step 4 collecting assets and payment of debts
Having done the above the Letter of Administration can now be extracted. And once it is extracts from the High Court the administrator now can collect all the assets of the Deceased into his possession to settle all the debts or liabilities of the Deceased. Meaning the administrator can now go to the bank and withdraw the Deceased’s monies from the bank or etc.
Step 5 distribution
Sample Letter of Administration Malaysia: Having collected the assets of the Deceased and settle all his debts, the Administrator can now distribute the assets of the Deceased in accordance with Section 6 of the Distribution Act 1958 (Act 300) which provides for the followings:
Sample Letter of Administration Malaysia: Section 6 Distribution Act 1958
(1) After the commencement of this Act, if any person shall die intestate as to any property to which he beneficially entitled to an interest which does not cease on his death. Such property or the proceeds thereof after payment thereout of the expenses of due administration shall. Subject to the provisions of section 4, distributed in the manner or held on the trusts mentioned in this section.
(2) If any person so dying intestate be permitted by his personal law a plurality of wives and shall leave surviving him more wives than one. Such wives shall share among them equally the share which the wife of the intestate would have been entitled to, had such intestate left one wife only surviving him.
(3) When the intestate and the intestate’s husband or wife have died in circumstances rendering it uncertain which of them survived the other. This section shall, notwithstanding any rule of law to the contrary, have effect as regards the intestate as if the husband or wife had not survived the intestate.
However, prior to the distribution, the Administrator will have to apply to the High Court for a distributor order to confirm with the distribution and to ensure that the respective shares of the beneficiaries are in accordance with the provision of Section 6 Distribution Act.
Sample Letter of Administration Malaysia: Probate and Administration Act Malaysia
Any beneficiary or vested interest of the deceased may make this application. The fee is based on the value of the estate, permitted by law under the Public Trust Corporation Act 1995 and Probate and Administration Act 1959. Here’s how much you can roughly expect:
Estate value Fee
For first RM25,000 1%
RM25,000 – RM225,000 2%
RM225,000 – RM250,000 3%
RM250,000 – RM500,000 4%
The third path you can take is only available to estates that include immovable assets, such as property. Applications can made under the Small Estates (Distribution) Act, 1955. The value of the estate must not exceed RM2 million in order to be eligible for this option. The Small Estate option does not require lawyers. And thus, is less costly than some of the other alternatives. There’s no fee charged by the Land Office for filing this petition.
How to Complete the Form A of the Small Estate Application?
Sample Letter of Administration Malaysia: The relevant application should start the process by completing Form A of the Small Estate application. This form essentially provides a full list of assets and liabilities of the individual, as well as potential beneficiaries. The documents required include:
- Form A of Small Estate application
- Identity cards or birth certificates of beneficiaries
- Marriage certificate of decreased (if any)
- Death certificate
- Evidence of assets
- A certified true copy of the land title or official title search from the Land Office
- Quit rent and assessment receipts
Applications are to made at the Estate Distribution Unit of the Department of the Director-General of Lands and Mines (JKPTG), or the Land Office where the deceased’s immovable property located. Once an application made, a hearing held to determine the estate administration. This usually takes place within three months.
Applicants and beneficiaries must be present at this hearing. Although a form can completed to note ‘inability to attend’ if unavoidable. All attendees must bring their respective identification. The hearing is essentially a fast-track version of estate administration, verifying the details noted on Form A, and confirming the beneficiaries. Once the court is satisfies that all the details are accurate, they’ll issue the LA and order for the distribution of an estate.
Small Estate Processing Fee
Payment for this service is then based on the value of the estate, as follows:
Small Estate processing fee
Estate value Fee
RM1 – RM1,000 RM10 flat fee
RM1,001 – RM50,000 RM30 flat fee
RM50,000+ 0.2% of estate value
One helpful tip is to request multiple letters of administration where possible! Banks, agencies, companies, and officials will all require a copy of this letter in order to take action on the relevant estate administration request. You can request copies from the Land Office for a flat RM5 fee. (Source: Property Guru)
Sample Letter of Administration Malaysia
1. Example of the Grant of Letters of Administration
2. Example of the Petition for Letters of Administration