When a person dies without a valid Will, they are said to have "died intestate." In such circumstances, the distribution of their assets and the handling of their estate falls under the jurisdiction of intestate succession laws based on the religion they belonged to.

This situation can create unexpected outcomes for the deceased person's assets, often leading to legal complexities. Understanding intestate succession is vital for anyone interested in estate planning or for those grappling with the estate of a deceased loved one.

Key Takeaways

• Understand the meaning of dying intestate
• Find out how probate works if you die without a Will.
• Get a thorough understanding of what can happen if you pass away without a Will and why you should avoid dying intestate.
• Know about how an heir is determined and how your assets are distributed when you die without a Will in place.
• Understand how Yellow can help you navigate the legal process if you die intestate.

What It Means To Die Intestate

To "die intestate" means to pass away without a legal Will. In such cases, families need to approach the revelant bodies such as the state Probate court or civil court or tehsildar, as applicable, to ascertain the legal heirs and seek assistance as the case may be to administer the deceased person's estate, known as an intestate estate. This process, governed by specific intestate succession laws, dictates how the deceased's assets are distributed among surviving relatives.

In India, when a person does not leave behind a Will, the distribution of such a person’s estate is determined by complex intestate succession laws. These laws vary based on the individual’s gender, marital status, and community or religion (personal laws).

For instance, Hindus follow the Hindu Succession Act of 1956, Christians and Parsis adhere to the Indian Succession Act of 1925, and Muslims are guided by Sharia law.

When assets are distributed on an intestate basis, the percentage is predetermined. Eg. In the case of Hindu males, their mother (if surviving) along with wife and children are entitled to an equal share of the assets.

So when an individual passes away, he or she is likely to leave behind 3-4 inheritors. Further, there is no control over specifying the recipients for each portion of the assets.

Process Involved If One Die Intestate

The Probate process essentially becomes applicable when one has executed a Will in Mumbai, Chennai or Kolkata or if the Will deals with immovable property in any of these places. For intestate estates, in many jurisdiction, a Letters of Administration needs to be obtained which involves several steps. Initially, the court must validate the absence of a will and appoint an administrator. Following this, the administrator must identify and value all estate assets, pay outstanding debts, and then distribute the remaining assets to the rightful heirs according to intestate succession laws.

In India, the Letters of Administration process for someone who dies intestate (without a Will) in India falls under the jurisdiction of the Indian Succession Act of 1925 and is applicable only for Hindus, Buddhists, Sikhs, and Jains. Here is an outline of how the process typically works in a Probate court.

1. Petition for Letters of Administration

If there is no will in any of the above-mentioned jurisdictions, the first step involves filing a petition for "Letters of Administration" in the competent court, generally being the High Court. This is a legal document granted by the Court that allows the administrator to manage and distribute the deceased's estate. In all other places, the first step is to apply for a Legal Heir Certificate or Family Tree Certificate (the nomenclature varies from place to place), which identifies the surviving legal heirs of the deceased person. This certificate is crucial for the transfer of the assets from the deceased to the heirs. The process for obtaining Legal Heir Certificate or Family Tree Certificate is discussed subsequently.

2. Publishing a Notice of the Petition

The court may require the publication of a notice of the petition to inform the public and potential claimants about the intestate succession process. This is to ensure that anyone with an interest in the estate has an opportunity to come forward.

3. Grant of Letters of Administration

Upon satisfactory review of the petition and no objections being raised, the court grants the Letters of Administration to the petitioner, who is usually a close relative of the deceased.

4. Inventory and Valuation of Assets

The appointed administrator must then inventory the deceased person's assets and get them valued. This includes all movable and immovable properties, financial assets, and any debts owed to the estate.

5. Payment of Debts and Liabilities

Before the assets can be distributed, the administrator must pay off any debts and liabilities of the estate, including taxes.

6. Distribution of Assets

After the debts are cleared, the remaining assets are distributed among the legal heirs according to the laws of intestate succession. The Act specifies a detailed order of preference regarding who inherits first.

7. Closure of the Intestate Process

Once the assets are distributed, the administrator is required to file a final settlement of accounts with the court. After the court's approval, the process of intestate succession is considered closed.

The process can vary based on the specific circumstances of the deceased and the local jurisdiction.

Succession Certificate and Legal Heir Certificate

At its core, a succession certificate provides legal recognition to the rightful heirs for the collection of debts and securities belonging to the deceased. The necessity of this certificate arises particularly in scenarios where the deceased person has left behind assets that require legal authorisation for transfer or collection, especially when a valid Will is not present. This certificate plays a critical role in simplifying the otherwise complex process of asset transfer. It effectively removes uncertainties surrounding the legal heirs' rights, providing a clear pathway for them to claim assets such as bank balances, stocks, and other securities. The Indian Succession Act meticulously outlines the process and requirements for obtaining a succession certificate, ensuring that the interests of all the legal heirs are safeguarded, and the deceased person's assets are distributed justly.

Understanding the distinction between a succession certificate and a legal heir certificate is essential in the context of handling a deceased person's estate in India. While often used interchangeably, these two documents serve different purposes in legal proceedings following a person's death.

A legal heir certificate, as its name suggests, identifies the legal heirs of the deceased person. It is a document primarily used to establish the relationship between the heirs and the deceased for various claims related to pension benefits, employee benefits, insurance, etc. In contrast, a succession certificate is specifically used for dealing with the deceased's debts and securities. Therefore, one can say that a legal heir certificate is more broadly applicable.

Obtaining a legal heir certificate is crucial, especially when it comes to settling various claims and benefits that were due to the deceased person. In practice, this certificate is often required by government bodies and financial institutions to process the transfer of any benefits or assets to the rightful heirs. For instance, in some states in India, if a deceased person was a government employee, his/her heirs would need this certificate to claim pension benefits.

Determining Heirs and Distribution of Assets

In intestate succession, the first consideration is usually the surviving spouse. If there are no children, the spouse may inherit the entire estate. However, if the deceased person has children, the estate is often split between the spouse and the children. The specific division varies by the religion you belong to.

For those without a surviving spouse or children, the estate may pass to other relatives such as parents or siblings. Intestate succession laws are designed to distribute assets to the closest living relatives of the deceased.

Why You Should Avoid Dying Intestate

Avoiding dying intestate (without a Will) is important for several reasons, as it can have significant implications for both the deceased person's estate and their surviving loved ones. When a person dies intestate, here's what can happen.

Loss of Control over Asset Distribution

Creating a Will allows individuals to specify how they want their assets and property to be distributed after their death. This level of control ensures that their wishes are honoured, and their belongings go to the people or causes they care about. Dying intestate means that this control is lost.

Multiple Owners

In the event of an intestate death, the distribution of assets may lead to multiple owners for a single property, potentially diminishing its overall value.

No (Or Limited) Provision for Loved Ones

A Will enables individuals to provide for their family and dependents in a way that reflects their intentions. This includes specifying financial support, guardianship for minor children, and any other arrangements that may be crucial for the well-being of loved ones.

Moreover, the compulsory division among designated heirs means that there is no way of ensuring that the more vulnerable members of the family, or a civil partner, are prioritised than the ones who are already well-established and may be less in need.

Family Disputes

Dying intestate can lead to family disputes over the distribution of assets. Clear instructions in a Will can help minimise the potential for disagreements and legal conflicts among surviving family members.

In the case of real estate without a Will, the family may jointly own the property. Selling jointly-owned property is tougher as it needs agreement from all owners. This can be challenging, leading to disputes and strained relationships.

Asset Discovery

Asset discovery takes considerably longer in the absence of a Will. The banks, financial institutions, and local authorities generally require a succession certificate or a legal heir certificate for asset transmission.

The primary purpose of these documents is to establish the legal heirs of a deceased person and grant them the authority to inherit debts, securities, immovable property, and other movable assets left behind by the deceased.

This process of obtaining these documents in time consuming, cumbersome and an expensive process. Usually, it can take several months to obtain these which means that the assets (including property) of the deceased cannot be accessed until then.

Assets Lost In Transition

When someone passes away without a Will clearly outlining the details of the assets, there is a high likelihood that these assets get lost in transition. A startling fact reported by The Hindu in August 2021 revealed that almost Rs 1.5 lakh crores worth of assets remain unclaimed with banks and insurance companies.

This is primarily because families are unaware of these assets, leading them to not step forward to claim them. This reflects the critical importance and urgent need for creating Wills across all income levels.

Stress for Survivors

Dealing with the loss of a loved one is already emotionally challenging. Having a clear and legally binding Will in place can significantly reduce the stress on surviving family members by providing guidance on how to handle the deceased person's estate.

Estate Administration

A Will streamlines the asset distribution as well as the Probate process (as applicable) and makes the administration of the estate more efficient. Without a Will, the distribution of property may be subject to the laws of intestacy, which can lead to a lengthier and more complex legal process in the applicable succession and Probate court.

Executors and Guardians

A Will allows individuals to designate an executor to handle the administration of their estate. Additionally, it provides the opportunity to name guardians for minor children, ensuring that trusted individuals are appointed to care for them.

Inheritance for Non-Family Members

Without a Will, the laws of intestacy typically prioritise close family members. Individuals who want to leave assets (including property) to friends, charities, or other non-family members should create a Will to ensure their wishes are fulfilled.

Family Relationships

Intestate succession can lead to unexpected outcomes that may strain relationships among family members. Creating a Will allows individuals to make thoughtful decisions that consider the needs and expectations of their loved ones, promoting harmony within the family.

The Importance Of A Will

Creating a Will is a responsible and considerate way to ensure that one's wishes are carried out and that their estate is handled according to their preferences. Having a valid Will in place is the best way to ensure that your estate is distributed according to your wishes. It simplifies the legal process, makes the Probate process more straightforward, and can help avoid conflicts among surviving family members.

Dying intestate often leads to unintended consequences, including prolonged legal disputes and potential hardship for surviving loved ones. A Will allows you to specify your Beneficiaries, appoint Guardians for minor children, and make specific bequests, ensuring that your wishes are carried out.

The Bottom Line: How Yellow Can Help

Dying intestate can complicate the distribution of your estate and may result in outcomes that do not align with your wishes. Understanding intestate succession laws and the role of Probate courts is crucial in these situations.

However, the best course of action is to prepare a valid Will, which serves as a clear, legal document outlining your intentions for your estate. Consulting with a legal expert in estate planning is highly recommended to ensure that your assets are protected and distributed as you desire.

At Yellow, we can help you create your Will quickly, simply and easily from the comfort of your own home. Know more on www.getyellow.in.