What is estate massing?

What is estate massing?

Estate massing is when two or more persons combine or consolidate their separate estates into a single massed estate in a joint or mutual will. This mutual will must indicate what must be done with the massed estate on the occurrence of a specified event. This event is usually the death of the first dying. Massing mostly occurs between married couples, but massing can also occur between other people regardless of whether they are married or even related.

Estate massing is usually used by couples married in community of property as a tool to ensure that the survivor of them will continue to be in control of the now massed estate so that they can still enjoy the same standard of living.

The requirements of estate massing:

1. The intention of the parties to consolidate their estates;

2. The first dying testator must have disposed of the survivor’s share of the joint estate as well as his/her own;

3. The surviving testator must adiate (accept) the massing.

Number 3 above does mean that the surviving testator does have a choice whether or not he/she wants to accept the massing. The estates will be dealt with separately if the surviving spouse repudiates (rejects) the massing.

Massing happens through legal institutions. Examples of these legal institutions are: a usufruct, a fideicommissum, trust (which are all limited rights) or an unlimited right.

Now there are two forms of massing, namely statutory massing and common law massing.

Statutory massing

Section 37 of the Administration of Estates Act 66 of 1965 governs statutory massing. The requirements for statutory massing is amongst others:

• There must be two or more persons as parties to the mutual will.

• The parties must execute a mutual or joint will.

• The parties must mass the whole or part of their separate assets into a consolidated unit. The mutual will must dispose of this unit.

• The mutual will grants a limited right in respect of any of the massed property to the surviving spouse. This is usually in the form of a usufruct, a fideicommissum or an income beneficiary of a trust.

• The disposition of the massed estate must take place after the death of the first dying.

• The survivor must adiate on the death of the first dying. To adiate means to accept.

Common law massing

Common law massing resembles statutory massing. The only difference is that the survivor does not get a limited interest in the massed property. Something else, or even nothing, could be awarded to the survivor.

As with anything there are consequences for each action. Whether the surviving testator adiates or repudiates there are consequences.

Consequences of adiation:

• The surviving testator loses the power to alter or revoke the joint/mutual will after adiation.

• The surviving testator renounces the power to dispose of his/her own estate in a manner different from that in which the first dying testator has already disposed of it in the joint/mutual will.

Consequences of repudiation:

• The surviving testator may not receive any benefit whatsoever under the will from the estate of the first dying testator.

• The surviving testator retains his/her own estate and may dispose of it in any way he/she wishes.

• The mutual will, as the will of the first dying testator, relates to the estate of the first dying testator only, subject to the provision that the surviving testator may not receive any benefit from the estate of the first dying testator.