Inheritors of estates enjoying benefits of near decade-old amendment to law
ALMOST A decade after Jamaica made legal history with the passage of the Administrator General’s (Amendment) Act of 2015, the benefits of the changes are now being felt.
The amendments put the government in a position to earn tens of millions of dollars in revenue and significantly reduce the backlog of cases involving the administration of estates in the Administrator General’s Department.
A key, ground-breaking change is the Administrator General (AG) now having the authority of issuing to herself a powerful document called an “Instrument of Administration” instead of applying to the Supreme Court for a grant of administration. Although prior to the amendments the AG had the power to administer relatively small estates without going to court, this transformational change allows for the administration of wealthy estates.
The landmark development was the brainchild of King’s Counsel Ian Wilkinson.
Wilkinson was concerned about the challenges that were being faced by inheritors of estates and thought that revolutionary changes were needed to Jamaica’s estate laws which would reap huge rewards and benefits for individuals and the country at large.
Around 2014, Wilkinson was invited by then Minister of Justice Mark Golding, who is now the leader of the opposition, to sit on a special committee set up by Golding to update a number of Jamaica’s laws. The committee consisted of various stakeholders such as representatives from the government, Supreme Court, the Administrator General’s Department and private practitioners.
Wilkinson told The Gleaner last week that, while on the committee seeking to find solutions to the various issues, he honed an idea that he had for a while.
“For some time I had thought about ways to assist the department with its backlog,” he said. “I had the idea to create this particular device that would give the Administrator General the power to administer more valuable estates under her control without having to apply to the Supreme Court for a grant of administration”.
Members of the special committee liked the idea and the Government took the necessary steps for the relevant laws to be amended. Section 53D (2) of the Administrator General’s (Amendment) Act states that an Instrument of Administration, “… shall have full legal effect in all respects and for all purposes as a grant of representation made to the Administration General by the Court”.
Wilkinson explained that “essentially, this Instrument of Administration has the same power as a grant of representation such as a Grant of Probate or Letters of Administration. What the amendment has done is to create a new legal tool for our public trustee that makes things better for the department and the people of Jamaica in general.”
These amendments, he said, are particularly important in dealing with what are called “multigenerational” estates. Under Section 53C of the Administrator-General’s (Amendment) Act the Administrator-General can issue the Instrument of Administration to herself and administer the “… primary estate or any succeeding estate, as the case may be and the assets of the primary estate shall be distributed in such manner or held in such trust as may be required by law”.
THIS TIES UP BILLIONS
The backlog of cases in the department had worsened before the amendment because estate matters had piled up for various reasons, sometimes over decades.
“The long and short of it is that, for many years, in some instances 30 to 40 years, a lot of people die without any grant of probate or letters of administration being issued to deal with these estates. This ties up these estates and also potentially billions of dollars of assets for the beneficiaries and revenue for government coffers.
‘’The amendments to the laws have gone a far way in solving this problem. In addition to the Instrument of Administration, another important legal device was created – An ‘Instrument of Distribution’. This allows the Administrator General to administer these multigenerational estates without having to get many grants of representation that otherwise would have been required,” Wilkinson said.
Wilkinson also pointed out that one of the additional benefits of the AG being able to administer estates without having to apply to the Supreme Court for a grant of representation is that it has cleared up a lot of space for applications filed in the Supreme Court by members of the public.
He believes also that these historic legislative changes reflect positively on Jamaica and should be attractive to investors, locally and internationally.
The Gleaner understands that other countries in the region are eyeing these Jamaican innovations and are contemplating making similar changes to their laws.
Administrator General Staci-Ann Carty is happy with the amendment and the beneficial effect.
“The Instrument of Administration has worked well and assisted the Administrator General’s Department. We are happy that this historic law was passed that has given us the authority to administer estates without having to apply to the courts,” Carty said.
IMPROVED SIGNIFICANTLY
Minister of Justice Delroy Chuck has described the AG’s Department as one of the better functioning agencies of government and said it has improved significantly, over the last 10 years, in clearing backlogs.
Chuck said the amendment allows potential beneficiaries to get immediate satisfaction and benefits from estates.
“Overall the AG’s Department is one of the better functioning agencies of government. The department has won customer service representative awards continuously for the last three or four years and is completing more files than are actually coming in so the backlog is being reduced,” Chuck said.
However, the department still has a significant number of files which are still being maintained as many of the estates cannot be closed or completed because of lack of funds within those estates, he disclosed.
“So, notwithstanding the completion of the process of administration, many of the properties cannot be turned over to the beneficiaries because outstanding government fees still need to be paid. These fees are really to transfer the properties and these properties oftentimes run into millions of dollars and the fees are several hundred thousand dollars. So, for small estates the fees are sometimes waived but for large estates involving fees of thousands of dollars it takes a few years before the beneficiaries can pay and take charge of their properties.