Dealing with the deceased’s property: Wills, intestacy, and the courts
When court approval isn’t needed
Court approval not necessary for amounts below specific limits
Administration Act 1969, ss 64–65, 82A Administration (Prescribed Amounts) Regulations 2009, regs 4, 4A
If the estate is a small one, it may not be necessary to apply to the courts for approval to deal with the estate (probate for a will, or letters of administration if there’s no will).
A range of institutions and individuals can transfer the following to the executor/administrator, family members, or other beneficiaries, without any need for probate or letters of administration:
- Money owing to the deceased, up to the value of $40,000, held by
- a superannuation fund,
- a building society, industrial and provident society, friendly society, or credit union,
- a bank,
- an employer of the deceased (provided that the deceased was employed by this employer within the six months before the date of death),
- a local authority,
- a trustee corporation,
- Kāinga Ora–Homes and Communities,
- the Accident Compensation Corporation,
- the Chief Executive of the Ministry of Social Development, or
- the Crown (i.e. the government);
- A life insurance pay-out, up to the value of $40,000;
- Government stock, up to the value of $15,000;
- Local authorities stock, up to the value of $15,000; and
- Shares in a company, up to the value of $15,000.
The executor/administrator or beneficiary will usually need to provide a copy of the death certificate in these cases. The person or organisation paying or transferring the money or other property must also be satisfied that probate or letters of administration haven’t been granted.
It is important to note that the law allows the specified institutions and individuals to transfer assets up to the specified values, but it does compel them to do so. Ultimately, the decision to transfer assets without requiring probate or letters of administration is entirely at their discretion. If they refuse, probate or letters of administration will be needed to deal with these assets.
Even if court approval isn’t needed because it’s a small estate, the executor has to follow the directions in the will. If there’s no will, they are still obliged to follow the rules of who is entitled to what property (“the laws of intestacy”).
Note: There is a common misconception, including amongst lawyers and financial institutions, that the $40,000 limit applies to the total value of the estate. No such limit on the estate value exists in legislation. In fact, an estate of much higher total value (for example, $1 million) could theoretically be administered without probate or letters of administration, provided that it did not include land or any individual holdings exceeding the specified limits.
If a bank or other institution refuses to make a transfer on the basis of the total value of the estate, you can question their reasoning and suggest they look at what the legislation actually says. Ultimately, however, you cannot force them to make a transfer, even if you think they misunderstand the law.
