This archive report was first published on 19 June 2020.
June 19, 2020, marked a significant milestone in the succession battle of the late powerful cabinet minister Mbiyu Koinange. After a 39-year fight, the High Court in Nairobi distributed Sh14 billion worth of wealth among his dependents.
Unfortunately, this is not an isolated case. The family of the late cabinet minister for Defense Njenga Karume has been living in near penury despite leaving behind a multibillion estate. This highlights the importance of having a proper estate plan in place.
Family lawyer Judy Thongori emphasizes that a will is a crucial component of estate planning. "Writing a will does not limit your rights in dealing or handling the property as you wish," she said in a Stanbic Bank webinar on estate planning. "If a will is done and signed properly, it is more than likely to be upheld by a court of law."
However, a will is not the only consideration. The Law of Succession Act section 26 and 27 gives the court complete discretion in ordering the specific share of the estate that shall be given to dependents who were not adequately provided for by the will.
Another option is joint tenancy or ownership, where a property is registered in your name and another person's. Once registered, the property cannot be passed to the listed person through a will, but will automatically be passed to them upon your death.
Inter vivos, or the transfer of property given as gifts, is also an important consideration. "Say you leave behind a multimillion estate without a will, but have already gifted one of your sons a house worth Sh50 million," lawyer Thongori explains. "When the matter on how to distribute wealth comes to court, and the court decides that everyone is to get Sh100 million, the beneficiary who got the Sh50 million house will receive Sh50 million only."
Nomination, such as with life insurance, is another key aspect of estate planning. "If you nominate Jane Doe in the insurance document as the beneficiary, but then nominate Anne Joe in the will, the person to take the benefits will be Jane Doe who was listed in the insurance policy," Thongori notes.
Trusts are also an option, where a property is held in trust for beneficiaries. "You move the property from your name. You put it your name as holding in trust for your children. Upon your death, that property will not go to your estate for redistribution, but to the children for whom you hold in trust," Thongori said.
Ultimately, a proper estate plan can prevent lengthy succession battles and ensure that your dependents are taken care of. By understanding the different options available, you can create a plan that works for you and your loved ones.
