The pandemic has forced people to think about their end-of-life plans and about securing the future of their loved ones. In the last few months, the fear of mortality has stepped up the business of estate and succession planners, who have been flooded with requests to draft or alter wills and trusts. Rajesh Narain Gupta, managing partner at law firm SNG and Partners, says he has recorded over 20 videos of people making their wills on the video-conferencing app Zoom. “I have had people in the age group of 40 to 60 calling me up to draft the wills and get it executed properly,” says Gupta.

For a will to be valid in the eyes of the law, the document can be prepared by a lawyer or by the clients themselves, and the document must be signed by two witnesses. A testator must also be present in the room in order to avoid having the validity of the will questioned later. “Most of the time people neglect to follow these rules. They will send the will to some person’s home and get it signed. At a later stage, if there is a dispute, and the matter goes before the court the witness cannot claim that the will was signed in their presence, and it is treated as invalid,” says Gupta.

Everyone needs one 

While young persons often do not prioritise the drawing up of a will as they believe they have enough time to do it, if there’s one thing the novel coronavirus has demonstrated, it is how unpredictable life can be.

“Having a will ensures that all assets are distributed according to the person’s choice after her demise, rather than by statutory disposition. It also helps prevent acrimony,” says Nisha Khurana, a senior estate and succession planning lawyer at Warmond Trustees and Executors. “The process of bequest becomes smooth [with a will], and family members aren’t troubled on this account in their time of grief,” says Khurana. Making a will can also help secure the interests of children from a previous marriage, if any, as stepchildren are not recognised as successors under the Hindu Succession Act.

In case of High Net-worth Individuals (HNI), succession planners may recommend forming a trust to ensure the smooth transition of wealth. “Globally, trusts are recognised as an important tool for succession planning. A family trust — with immediate family and dependents as members to monitor the wealth of the individual as well as the company/ies owned — is a great tool to plan milestone-based transition of property, to safeguard against volatility in marriages, and to provide for minor beneficiaries as well as for those with special needs,” says Khurana. “A private trust is also a good way to plan for rainy days and to protect assets.”

Mistakes to avoid 

Khurana says, people often leave unclear instructions in their wills which could lead to family feuds. “It is important to state clearly what amount or share of property is being left for the successor and the reasons for any unequal distributions, if any. This goes a long way in avoiding disputes,” Khurana says.

In many cases, the spouse or other family members are unaware of the number of bank accounts held by the deceased family member, how much wealth is there in the accounts, details of investments made and assets procured. They may also be unfamiliar with the law with regards to inheritance, and the death of a family member intestate, may then turn up a number of surprises.

Under the Hindu Succession Act, for instance, if a Hindu male dies without making a will, his wealth is then divided between his mother, wife and children, equally. So, if a property is owned jointly by the husband and wife, in case of the husband’s death, his share of the property will go to the mother, wife and children. The same Act applies for Sikhs, Jains and Buddhists. For Parsis, Christians and Jews, bequest is governed by the Indian Succession Act, while Muslims follow the Shariat Act. In the presence of a will, bequest under the Hindu Succession Act is not applicable. Of course, there’s always a chance that the will may be challenged, but if you have ticked all the necessary boxes, this should not be a problem.

Succession planners recommend having comprehensive wills with details of bank accounts, demat accounts, details of the wealth manager, and so on. It should also contain its distribution pattern of the property and wealth among the heirs to avoid any confusion.

A comprehensive succession plan will uncomplicate the administrative and legal processes such as the need to get letters of administration, succession certificates and the procedure of probate, for the families. In case, the person is of advanced age, it is always better to get a doctor’s certificate attached clearly stating that the person is of sound physical and mental health while drawing the will. To list a minor as a successor, it is important to have a trusted guardian. Also, care should be taken while choosing the executor. Many succession planners recommend appointing third-party executors to avoid conflicts of interest.

Khurana recommends revisiting the will every five years as the property and assets held could change. Additionally, the family situation may also evolve through the years. According to advocate Sanket Kulkarni, many properties get embroiled in legal disputes when the succession is not spelled out clearly.

“A disputed property is everyone’s loss as it cannot be monetised. It only makes sense for those with properties/assets to make wills and name successors clearly,” says Kulkarni.

It is important to state clearly (in a will) what amount or share of property is being left for which successors and the reasons for any unequal distribution. This would prevent disputes
—Nisha Khurana, succession planning lawyer